88 Energy provides an update on Project Icewine

88 Energy (ASX, AIM: 88E) has provided the market with an update on Project Icewine, located onshore North Slope of Alaska.

Key Highlights:

• Wireline logs acquired successfully throughout the production interval;
  • Data quality excellent.
  • Processing and interpretation underway.
• Icewine#2 4.5” production liner completion to be re-run;
  • Finalisation of completion expected prior to end of week.
• Production testing remains on schedule for late June / early July.

Icewine#2 Operations Update

Wireline logging throughout the production interval at Icewine#2 was completed over the weekend, with great success.

The quality of the data acquired is excellent and complements the core and logs retrieved at Icewine#1. The enhanced data suite will ensure that optimal design of the planned stimulation is achieved at Icewine#2.

During cementing of the 4.5” production liner, hole conditions in the Pebble Shale Unit (beneath the HRZ production interval) prevented successful completion. The liner was retrieved to surface and will undergo minor repair whilst the hole is reconditioned to minimise the chance of recurrence. Post repair the liner will be run back in the hole and re-cemented. This operation is expected to be finalised during the week. Production testing remains on schedule.

Managing Director of 88 Energy Limited, Dave Wall commented:

“The data quality from the wireline logs recently completed is excellent and, at this early stage in the processing and interpretation, is confirmatory to the data obtained from Icewine#1 – as expected. Additional insights are expected from the log interpretation and completion of the micro stimulations over the coming days as we finalise the design to the stimulation program.

The minor setback related to completing the production liner installation has not altered the schedule for production testing, as prior to this we were running several days ahead of plan.”

Further updates will be made as and when appropriate throughout the drilling / testing program.

Project Icewine Overview

In November 2014, 88 Energy 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.

In June 2016, the gross acreage position was expanded to 271,119 contiguous acres (210,250 acres net to 88 Energy). In December 2016 the 88 Energy successfully bid on additional acres. On award the Project Icewine gross acreage position will be further expanded to ~690,000 contiguous acres (~400,000 acres net to the 88 Energy assuming all rights are taken up).

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 scheduled to occur in mid-2017.

Significant conventional prospectivity has also been identified on recently acquired 2D seismic across the project acreage.

Project Icewine Acreage