TIDM88E
RNS Number : 9595G
88 Energy Limited
08 March 2018
8(th) March 2018
88 Energy Limited
Option Proceeds and Expiry Update
88 Energy Limited (ASX: 88E) ("88 Energy" or the "Company") is
pleased to announce that approximately 98% of its listed $0.02
options ("Options") were exercised by option holders in advance of
the 2 March 2018 expiration date.
A total of 405m Options were exercised by option holders,
resulting in proceeds amounting to $8.1m being received by the
Company.
Pursuant to the Option Underwriting Agreement announced on 12
February 2018, the underwriter Hartleys Limited or its
sub-underwriters, will now take up 8.7m shares in the Company
comprising the Shortfall.
The high proportion of Options exercised is an outstanding
result for 88 Energy and along with the existing strong cash
position ensures the Company is well funded for the next important
programs of work, which include: further work at the Icewine#2
appraisal well; settling the acquisition of new acres on the North
Slope; 3D seismic acquisition and for other ongoing exploration and
leasing costs of Project Icewine.
Media and Investor Relations:
88 Energy Ltd
Dave Wall, Managing Director Tel: +61 8 9485 0990
Email: admin@88energy.com
Finlay Thomson, Investor Relations Tel: +44 7976 248471
Hartleys Ltd
Dale Bryan Tel: + 61 8 9268 2829
Cenkos Securities Tel: + 44 131 220 6939
Neil McDonald/Derrick Lee
Pursuant to the requirements of the ASX Listing Rules Chapter 5
and the AIM Rules for Companies, the technical information and
resource reporting contained in this announcement was prepared by,
or under the supervision of, Mr Brent Villemarette, who is a
Non-Executive Director of the Company. Mr Villemarette has more
than 30 years' experience in the petroleum industry, is a member of
the Society of Petroleum Engineers, and a qualified Reservoir
Engineer who has sufficient experience that is relevant to the
style and nature of the oil prospects under consideration and to
the activities discussed in this document. Mr Villemarette has
reviewed the information and supporting documentation referred to
in this announcement and considers the prospective resource
estimates to be fairly represented and consents to its release in
the form and context in which it appears. His academic
qualifications and industry memberships appear on the Company's
website and both comply with the criteria for "Competence" under
clause 3.1 of the Valmin Code 2015. Terminology and standards
adopted by the Society of Petroleum Engineers "Petroleum Resources
Management System" have been applied in producing this
document.
Project Icewine Overview
In November 2014, the Company entered into a binding agreement
with Burgundy Xploration (BEX) to acquire a significant working
interest (87.5%, reducing to 77.5% on spud of the first well on the
project) in a large acreage position on a multiple objective,
liquids rich exploration opportunity onshore Alaska, North America,
referred to as Project Icewine. The current gross acreage position
is 475,000 contiguous acres (301,000 acres net to the Company).
The Project is located on an all year operational access road
with both conventional and unconventional oil potential. The
primary term for the State leases is 10 years with no mandatory
relinquishment and a low 16.5% royalty.
The HRZ liquids-rich resource play has been successfully
evaluated based on core obtained in the recently completed
(December 2015) Icewine #1 exploration well, marking the completion
of Phase I of Project Icewine. Phase II has now commenced, with
drilling at the follow-up appraisal well, Icewine#2, commencing
early 2Q2017. Production testing is ongoing.
Significant conventional prospectivity has also been identified
on recently acquired 2D seismic across the project acreage.
Cautionary Statement: The estimated quantities of petroleum that
may be potentially recovered by the application of a future
development project relate to undiscovered accumulations. These
estimates have both an associated risk of discovery and a risk of
development. Further exploration, appraisal and evaluation are
required to determine the existence of a significant quantity of
potentially movable hydrocarbons.
Exploration incentives provided by the State of Alaska with up
to 35% of net operating loss refundable in cash were concluded for
all expenditure post 31 December 2017.
The primary objective is an untested, unconventional
liquids-rich shale play in a prolific source rock, the HRZ shale
(Brookian Sequence), that co-sourced the largest oil field in North
America; the giant Prudhoe Bay Oil Field Complex. Internal
modelling and analysis indicates that Project Icewine is located in
a high liquids vapour phase sweetspot analogous to those
encountered in other Tier 1 shale plays e.g. the Eagle Ford,
Texas.
Recently acquired 2D seismic has identified large conventional
leads at Project Icewine within the same Brookian petroleum system
and shallow to the HRZ shale, including potential high porosity
channel and turbiditic sands associated with slope apron and
deepwater fan plays. The Brookian conventional play is proven on
the North Slope; the USGS (2013) estimated the remaining oil
potential to be 2.1 billion barrels within the Brookian sequence.
Two recent discoveries in the Brookian have already exceeded these
estimates, with Armstrong/Repsol discovering 1.4 billion barrels in
2015 and Caelus announcing a 2.5 billion barrel discovery in 2016.
Additional conventional potential exists in the Brookian delta
topset play, deeper Kuparuk sands and the Ivishak Formation.
A Prospective Resources Report by DeGolyer and MacNaughton, was
commissioned by 88 Energy to evaluate the unconventional resource
potential of Project Icewine in February 2016 and was released to
the market on 6(th) April 2016.
About 88 Energy: 88 Energy has a 63% working interest and
operatorship in 342,000 acres onshore the prolific North Slope of
Alaska ("Project Icewine"). Gross contiguous acreage position for
the Joint Venture is 475,000 acres (88E 301,000 net acres). The
North Slope is the host to the 15 billion barrel Prudhoe Bay
oilfield complex, the largest conventional oil pool in North
America. The Company, with its Joint Venture partner Burgundy
Xploration, has identified highly prospective play types that are
likely to exist on the Project Icewine acreage - two conventional
and one unconventional. The large unconventional resource potential
of Project Icewine was independently verified by leading
international petroleum resource consultant DeGolyer and
MacNaughton. In addition to the interpreted high prospectivity, the
project is strategically located on a year-round operational access
road and only 35 miles south of Pump Station 1 where Prudhoe Bay
feeds into the Trans Alaska Pipeline System. The Company acquired
2D seismic in early 2016 to take advantage of the globally unique
fiscal system in Alaska, which allowed for up to 75% of 1H2016
exploration expenditure to be rebated in cash. Results from the
seismic mapping and prospectivity review are encouraging, and form
the basis of a conventional prospectivity portfolio for Project
Icewine. In late 2015, the Company completed its maiden well at the
project, Icewine#1, to evaluate an unconventional source rock
reservoir play which yielded excellent results from analysis of
core obtained from the HRZ shale. The follow-up well with a
multi-stage stimulation and test of the HRZ shale, Icewine#2, spud
in early 2Q2017. Flow testing at Icewine#2 is scheduled to
re-commence in April/May 2018.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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