88 Energy boosts resources by more than 50% at its Project Phoenix in Alaska

A new study has significantly increased the estimated contingent resources for 88 Energy’s (ASX: 88E) Project Phoenix in Alaska.

In what is a potential game-changer for the project, the resource estimates for the SMD-B and SFS reservoirs have increased by more than 50%.

Independently verified by auditor ERCE Australia, the reservoirs are now estimated to contain 115 million barrels of gross recoverable hydrocarbon liquids and 68 billion cubic feet of gross recoverable gas.

Multi-reservoir discovery

Project Phoenix is located directly adjacent to the Trans-Alaskan Pipeline System and the Dalton Highway, with close proximity to the critical oil and gas services hub at Deadhorse on Alaska’s North Slope.

The various estimates from ERCE and Netherland, Sewell & Associates have confirmed the project as a robust multi-reservoir discovery with a total combined gross best estimate 2C contingent resource of approximately 378MMbbl of oil equivalent.

The studies have also identified significant upside potential, with unrisked prospective resources estimated at 155MMbbl in the undrilled Kuparuk and SMD-A and C reservoirs that were intersected in the Hickory-1 well.

Development opportunity

88 Energy says the new estimates have confirmed Phoenix as a strategic development opportunity featuring the critical characteristics required for future commercialisation and monetisation.

This includes combined best estimate contingent resources of approximately 251MMbbl of oil and natural-gas liquids across the four stacked reservoirs, accessible from a single surface location.

The company is now set to further confirm the project’s commercial potential with an extended period horizontal well-flow test of the SMD reservoir.

Future funding

88 Energy is currently in discussions with Burgundy Xploration regarding a potential transaction to help fund future development.

Burgundy – a private Texas company supported by sophisticated oil and gas investors – has invested more than $37 million into Phoenix over the life of the project.

It is believed that Burgundy is progressing plans for a stock exchange listing, following which it is anticipated it will enter into an agreement to provide a carry to 88 Energy for the anticipated 2025/26 Phoenix work program in exchange for an additional interest in the project.

The provision of such a carry to 88 Energy would be subject to Burgundy raising the capital required alongside its listing process.