Perth, June 25, 2016 AEST (ABN Newswire) - ASX-listed oil and gas explorer 88 Energy Ltd (
ASX:88E) (LON:88E) has reported positive cost analysis for its exciting Project Icewine oil play on the prolific North Slope of Alaska.
The new studies supported by data from the company's first well drilled in the Project area show that the break-even cost for a potential development at Icewine would be well below the current oil price.
The company's Managing Director, David Wall, says the that new cost and flow rate assumptions produced in the recent studies makes for very compelling project economics at Icewine.
"Out P50 scenario for both cost and flowrate is less than US$40 a barrel, which is outstanding," he said.
88 Energy has already announced that Icewine may contain a gross mean prospective recoverable resource of between 1.4 and 3.6 billion barrels of oil equivalent following the drilling of the Icewine #1 well in late 2015.
Critically, analysis of core, logs and geochemistry from that well have indicated that the project is highly prospective based on thermal maturity, matrix permeability and resource concentration.
Mr Wall said information obtained from Icewine #1 showed that the rocks at the site have very positive permeability and porosity, with the permeability found to be even higher than expected.
"That was a pleasant surprise for us and consequently we have been able to forecast higher flow rates than initially expected."
Mr Wall said the company will obtain more key information on the Project's potential in August when it receives results from an interpretation of 750km of seismic data.
That will be followed by the spudding of the Icewine #2H well in quarter 1, 2017.
This well, which is planned to be flow tested, will provide important information with regard to potential flow rates for the project as well as future well designs.
Icewine #2H, which will be fracture stimulated, will be drilled vertically to a depth of around 11,000 feet, the depth of the HRZ target zone, and then be drilled laterally for approximately 3000 feet.
"This will be the real key test for the HRZ play in the Icewine area," Mr Wall said.
The Australian stock market will be paying particularly close attention to the upcoming seismic and drill results with 88 Energy's share price on a high on the back of the initial exploration successes.
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Contact
Colin Hay
Account Manager
Email: colin.hay@ppr.com.au
Phone: +61-8-9388-0944
www.ppr.com.au
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