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88 Energy issues half-year report
During period ending June 30, continues principal Alaska activities, including finding farm-out partner for Tiri-1 Kay Cashman Petroleum News
88 Energy Limited issued a half year report for the six months ending June 30.
During the period, the group continued its principal exploration and appraisal activities in Alaska, complemented by a 75% owned, non-operated working interest in onshore Texas Permian Basin production assets.
The group also farmed-in and subsequently received transfer approval for a 20% working interest in Petroleum Exploration Licence (PEL 93), Onshore Namibia.
The director's account in the half-year report was signed by Philip Byrne, non-executive chairman on Sept. 2.
One of the topics covered in the report was 88 Energy's "focused" strategy in Alaska.
In the state the company has its attention on infrastructure-led opportunities that benefit from proximity to services at Prudhoe Bay, the Trans-Alaskan Pipeline System (TAPS) and other key infrastructure.
In Alaska, 88 Energy is engrossed in advancing Project Phoenix and Project Leonis. Following Hickory-1 successfully flowing light oil to surface, the company is aiming to drill horizontal production wells and generate cash flow within the next 24 months from Project Phoenix as well as unlocking Project Leonis' potential through an appraisal well program.
Relief from BLM Following proposed new regulations governing the management of surface resources in the National Petroleum Reserve-Alaska, 88 Energy successfully requested from the U.S. Bureau of Land Management Alaska initial 12-month suspensions for Project Peregrine to December 2024 and the Umiat Unit to 30 June 30, 2025. The suspensions allow 88 Energy to benefit from a reduction in lease costs and to focus its efforts on unlocking value from its key strategic acreage positions - these are adjacent to infrastructure that should accelerate commercialization of the projects.
Acreage that was deemed non-core to 88 Energy was relinquished during 1H 2024, including all of Icewine East (~23k acres/16 blocks) due to geographical challenges near/over the SAG river, lack of prospectivity and an 8-year primary term that expired on May 31 without being unitized.
"Additionally, 36 blocks at Icewine West covering ~51k acres with its 8-year primary term also expiring in May reviewed the remaining Icewine West acreage and although it noted prospectivity across a group of leases including Charlie-1," 88 Energy said that "a combination of the company's focus being on assets that are adjacent to infrastructure, and the annual 'holding' rental costs of acreage means there are no immediate plans for further drilling at Icewine West.
88 Energy has requested relinquishment of the remaining Icewine West acreage from the Alaska Department of Natural Resources and approvals are expected in third quarter.
The acreage positions will relieve the company of ~A$2.15M/pa in lease costs. (net to 88E).
Project Leonis (100% WI) In June, the company reported a maiden internal prospective resource net mean estimate of 381 million barrels of recoverable oil in the newly named Tiri prospect (Upper Schrader Bluff, or USB, formation) for Project Leonis. (unrisked net3U (high) of 671 million barrels, 2U (best) of 338 million barrels and 1U (low) of 167 million barrels.
The initial prospective resource estimate followed a review period of an extensive data suite that included 3D and 2D seismic data, well logs from Hemi Springs Unit-3 and Hailstorm-1, as well as nearby wells adjacent to the Project Leonis acreage, along with extensive petrophysical analysis and mapping, 88 Energy said.
"Importantly, the USB formation is the same proven producing zone as nearby Polaris, Orion and West Sak oil fields to the north-west," 88 Energy said.
These proven USB producers served as "important calibration points for the Leonis petrophysical model," the comp[any said/
Per 88 Energy, the Leonis USB prospect has been fully delineated and mapped following a review of reprocessed 3D seismic data and a 3rd party dedicated fault mapping study to assist in prospect definition.
Forward program According to 88 Energy, it has engaged Hickory-1 project management company Fairweather to assist in planning and permitting for the newly named Tiri-1 exploration well.
The well will be designed to drill, log and test the Tiri prospect in the USB formation. The company intends to utilize the existing gravel pad at the Hemi Springs Unit-3 well to reduce costs.
Timing for the drilling of the Tiri-1 exploration well is dependent on securing a successful farm-out partner and the company has secured Stellar Energy Advisors Limited in London to manage the farm-out process. They have "been engaged with multiple parties in advancing the assessment of the farm-out opportunity. The process is ongoing," 88 Energy said.
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