In an update for the quarter to 31 December 2021, 88 Energy (88E has highlighted its recent progress, including the upcoming spud of Merlin-2 well which remains on track for next month.
The Alaskan-focused explorer’s Merlin-2 appraisal well is targeting a gross mean prospective resource of 652 million barrels which holds a 56% aggregated geological chance of success.
The drilling location of the appraisal well is situated east and downdip of Merlin-1, where enhanced reservoir thickness and higher permeability/porosity of sands are expected.
On Monday, 88E told investors that the commissioning of the Arctic Fox rig had commenced ahead of mobilisation to the Merlin-2 drilling location where permitting and planning for a proposed well is now ‘largely complete,’ with the well on track to spud in February 2022.
In an operations update released yesterday morning, the Alaskan-based explorer highlighted that construction of the single lane snow road to the Merlin-2 location, which is located in the Project Peregrine in the NPR-A region of the North Slope of Alaska, had also commenced.
The Group noted ‘good conditions’ in the field and construction of the snow road on schedule.
88 Energy said the Merlin-2 Permit to Drill is now in the final stages of review by the Bureau of Land Management (BLM) and remains on schedule to be issued ahead of rig mobilisation.
88 Energy also noted on Monday that it is aware of media reports of correspondence to the BLM from the Centre for Biological Diversity (CBD) with respect to the Permit to Drill for the Merlin-2 well. The CBD is a not-for-profit environmental activist group in the U.S, it explained.
With the current status of the review of the Permit to Drill by the BLM, as well as numerous other related approvals and permits from various government agencies, 88 Energy is nearing completion of permitting and the well remains on track to spud in February 2022, it detailed.
The Merlin-2 appraisal well is planned for a Total Depth of 8,000 feet, and is targeting 652 million barrels of oil 1,2 in the highly prospective N18, N19 and N20 targets that were encountered in the successful Merlin-1 well (drilled in March 2021 to a depth of 5,267 feet).
Shares in 88 Energy were trading 12.03% higher this morning at 1.9p following the news.
Merlin-1, which was spudded in March 2021 and completed in April, has demonstrated the presence of oil in these multiple stacked sequences within the Brookian Nanushuk Formation.
At the Umiat Oil Field, in which 88 Energy holds 100% working interest, optimisation studies continue, including full field development planning and evaluation of oil field synergies.
At the Group’s Project Icewine, in which it holds 75% working interest, an assessment has indicated the extension of Pantheon Resources’ Talitha-A targets onto Icewine acreage.
In addition, in regard to the Yukon Leases, 88 Energy says the joint regional development negotiations and due diligence processes are well advanced with nearby resource owners.
The Company added that in 4Q, Mr Oliver Mortensen was appointed as Chief Financial Officer and that as at 31 December 2021, the Group had cash of A$32.3M and no debt.
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