88 Energy (AIM:88E ) has released new fully assessed data from the Charlie-1 appraisal well on the Alaska North Slope which the group plugged and abandoned back in April 2020.
The analysis also follows joint venture partner, Premier Oil’s, withdrawal from the project.
The AIM and ASX-listed energy firm reported that final petrophysical interpretation released today will potentially upgrade the net hydrocarbon pay in the Charlie-1 well ‘substantially’.
88E said at the time of the plugging that further testing was required before it could think about commercial exploitation, given the likelihood of high gas content in the reserves.
Today, however, the company has reported new data showing the Seabee and Torok prospects with less gas than previously anticipated, reinstating them as compelling targets.
The third party petrophysical interpretation from the Charlie-1 well is detailed below.
The values consider data from logs obtained during drilling using a logging suite and multiple lab analyses of sidewall cores taken from the key horizons in the Charlie-1 well.
‘Encouragingly’, the company detailed to investors, ‘the final interpretation provides a significant increase in net pay, compared to the initial interpretation, of 398' (vs 280'), with the largest contribution coming from the Lima discoveries in the Seabee Formation.’
88E said the improvements are despite using higher cut-offs for both reservoir and net pay.
Final petrophysical interpretation and lab results from the Charlie-1 well have now confirmed both the Upper and Lower Lima in the Seabee Formation as large oil discoveries.
The results are ‘particularly significant’ as these targets are the most extensive of the Icewine conventional horizons and are relatively shallow compared to the Torok Formation.
88E said the extent of the accumulations will be estimated over the coming weeks as these final petrophysical numbers are integrated into the updated seismic inversion product.
Similarly, the Stellar targets in the Torok Formation have also been confirmed as hydrocarbon discoveries with good liquid hydrocarbon content.
There remains some uncertainty about the gas to oil ratio as the liquid hydrocarbon saturations measured from the Charlie-1 cores in the lab imply much lower gas to oil ratio than that observed during the downhole tests that recovered gas condensate.
It is possible that these liquids may be unlocked by stimulation of the reservoir, however.
Shares in 88 Energy reacted positively to the news with the shares opening up 30% following the announcement.
Commenting on the significance of Seabee, Managing Director of 88E Dave Wall, stated:
"The results from the Seabee, despite Charlie-1 not being optimally located, are outstanding. Whilst these may appear as a serendipitous by-product of the well, internal analysis prior to drilling had already significantly high graded this formation; however, it was too late to change the objectives/location of the well meaning that work remained largely on the drawing board.”
“This final interpretation is a strong vindication of that internal effort. We are now looking forward to the conclusion of the evaluation of the Seabee oil discoveries as we integrate the petrophysics into the seismic inversion and subsequent mapping, which will ultimately yield updated volumetrics for our resources that will feed into the Icewine farm-out process.”
Elsewhere, in the shale portion of Project Icewine, technical work has confirmed the ideal thermal maturity for the HRZ shale. Wall said said this was encouraging and that the resultswill form the basis of further work to continue to unlock its large potential.
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