88 Energy (88E) has signed a binding farm-out agreement with Westlawn Americas Offshore (WAO), securing up to US$10.9 million (A$15.5 million) towards drilling and evaluation at its South Prudhoe project in Alaska.
Under the agreement, WAO will acquire a 40% working interest in South Prudhoe, while 88 Energy retains a majority 60% interest and operatorship.
WAO will contribute US$9.2 million (A$13.1 million) towards drilling and evaluating the Augusta-1 exploration well, covering ~52% of the current planned well budget. It will also provide a further US$1.7 million (A$2.4 million) towards geological and geophysical work, administration, lease costs and long-lead items for a potential future flow test.
Augusta-1 is scheduled to spud in Q1 2027, targeting 133.7 million barrels of gross unrisked 2U Prospective Resources across the stacked Ivishak, Kuparuk and Brookian reservoir intervals.
If drilling results justify further evaluation, WAO will fund 40% of a potential two-zone flow test targeting the Ivishak and Kuparuk reservoirs, currently estimated to cost US$4.5 million (A$6.4 million) gross.
The agreement follows extensive technical and commercial due diligence by WAO, which brings significant North Slope experience. The companies are also considering establishing an Area of Mutual Interest to jointly evaluate further exploration opportunities across the region.
88 Energy's Managing Director Ashley Gilbert said: “Securing a partner of WAO's calibre is a tremendous outcome for 88 Energy shareholders and is, without a doubt, a defining milestone in the advancement of the South Prudhoe Project. We have secured a partner that adds genuine value, having extensive Alaskan experience, deep upstream expertise and a long-term investment approach that is highly complementary to our own ambitions on the North Slope.
“WAO’s decision to farm-in follows a comprehensive technical and commercial evaluation of the Project and provides strong third-party validation of both the quality of the South Prudhoe opportunity and the substantial technical work undertaken by our team over the past 18 months. We believe this endorsement reinforces our confidence in the potential of Augusta-1 and the broader prospectivity we have identified across the acreage.
“More importantly, it establishes a partnership capable of creating value beyond a single well.”
View from Vox
The farm-out represents a significant milestone for 88 Energy, reducing its funding exposure to Augusta-1 while preserving majority ownership and operational control. WAO's participation provides external validation of South Prudhoe's exploration potential and strengthens the project's pathway towards drilling in early 2027, while opening opportunities for broader collaboration across Alaska's North Slope.