88 Energy Limited (AIM:88E ) announced that it has executed the drilling contract to drill the Merlin-1 and Harrier-1 wells for Project Peregrine located on the North Slope of Alaska.

88E highlighted its ‘good progress’ for the imminent drilling campaign with permitting and planning which leaves 88 Energy on track for its scheduled spud date of February 2021.

88 Energy acquired Project Peregrine, a project which consists of 195,000 net acres, as part of its merger with XCD Energy earlier this year, an oil exploration and production company which holds a 100% Working Interest in the highly prospective Alaskan North Slope.  

The dual-listed group told investors that it had successfully executed a farmout deal with Alaska Peregrine Development Company ("APDC") for its Project Peregrine last week.

Prior to this, 88E had been awaiting final documents since November after progressing its Project Peregrine farmout process to the final phase by selecting the preferred bidder. 

As part of the farmout deal, APDC will now earn 50% in Project Peregrine by contributing US$11.3m towards the cost of the Merlin-1 well (estimated gross cost US$12.6m). 

It said it has also executed a rig contract with All American Oilfield, to use Rig 111 to drill the Merlin-1 and Harrier-1 wells at Peregrine in the NPR-A region of the North Slope of Alaska.

Both wells will be drilled to a total depth of around 6000ft to intersect the prospective Nanushuk topset horizons on trend to existing discoveries to the north of the project area.

Meanwhile, Pantheon Resources (AIM: PANR ) announced that its Talitha-A well, close to the northern border of the 88E central acreage position, is scheduled to spud in January ’21.

Several of the prospective horizons in Talitha-A are interpreted to extend into 88E acreage as indicated below (see Fig.1).

Fig.1 Icewine Lease Position and Prospectivity (Source: 88 Energy)
 

[Source: 88 Energy]

Commenting on the drilling execution, Managing Director of 88 Energy, Dave Wall, said, “Drilling at Project Peregrine is moving ahead as planned and we are only 3 months away from spud on what will be a potentially company making prospect for our shareholders."

Shares in 88 Energy have been trending positively over the past month following positive Newsflow on Project Peregrine to open up 7% in early trade following this announcement.

Reasons to Follow 88 Energy

Project Portfolio Across Alaska’s North Slope  

The Alaskan explorer completed its acquisition of XCD Energy, which holds a 100% Working Interest in the highly prospective Alaskan North Slope, back in August 2020. The merged entity has formed a diversified portfolio of exploration projects on Alaska’s North Slope. 

The combined company will have increased scale, market presence along with higher funding capability and trading liquidity across the ASX and London AIM exchanges.   

The three key projects include Project Icewine, Yukon leases and Project Peregrine with the assets at various stages of development, the company previously outlined this summer.  

In recent weeks, 88E was also formally re-assigned the "Area A" leases at Project Icewine meaning its working interest in around 40% of the project has increased from 30% to 75%.   

Positive Newsflow Expected on IceWine 

It recently said an independent resource estimate at Icewine which will integrate the results of the recently successful Charlie-1 well is ‘due within weeks.’ Both an increase in acreage and the resource estimate are expected to facilitate ongoing farm-out discussions at Icewine. 88E highlighted that a new farm-out process will follow the release of the report.

Positive Newsflow Expected on Yukon  

88E has also informed investors that talks are continuing in regard to the Yukon acreage to optimise the monetisation strategy of the acreage, with permitting continuing for future potential. The Company said it is also planning to bring this project area into a farm-out.  

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