88 Energy (88E), the Alaska-focused oil and gas explorer, has announced the formal award of the entirety of the Project Leonis acreage by the Alaskan Department of Natural Resources.
The award brings 25,430 contiguous acres immediately south of Prudhoe Bay into play, with the company now planning a detailed analysis to determine the exploration opportunity and define a possible exploration programme.
Project Leonis is fully covered by an existing suite of 3D data, which will be reviewed again this year in advance of a potential drilling programme which could begin in the first quarter of 2024. The acreage also contains the historical Hemi Springs Unit #3 exploration well, which was drilled by ARCO in 1985.
Although that drilling was unsuccessful, modern log analysis has indicated over 200 feet of low resistivity bypassed log pay within the USB reservoir, with good porosity and oil shows evident over this interval. Management’s confidence in the project is further strengthened by the successful development of the same reservoir across nearby oil fields at Orion, Polaris, West Sak and Milne Point.
Like the explorer’s other Alaskan project, Leonis is located close to existing infrastructure including the Dalton Highway and the Trans Alaska Pipeline System, allowing easy and cost-effective export routes should exploration prove successful.
88 Energy Managing Director, Ashley Gilbert, commented: "Formal award of this new acreage provides confirmation of a further highly attractive Alaskan exploration proposition for our business. Project Leonis benefits from proximity to infrastructure and services at Prudhoe Bay and Deadhorse, as well as an historical well that indicated oil shows and calculated pay in the Upper Schrader Bluff (USB) zone of interest.”
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This news follows further positive updates this week from its Project Phoenix on Alaska's North Slope, with drilling confirming the presence of multiple hydrocarbon bearing pay zones across all pre-drill targets at its Hickory-1 well.
Such results add to the growing body of evidence supporting the potential of 88 Energy's Alaskan exploration programme, which has been de-risked by recent drilling and flow test conducted on adjacent acreage by Pantheon Resources.
In August, 88 Energy raised A$14.9m (£8.32m) to finance long lead items required for drilling at Phoenix, as well as to strengthen the company's balance sheet and provide capital to finance new ventures. Alongside the fundraising, cash flows from its conventional Texas production are available to reinvest in high impact exploration.