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88 Energy Secures Funding, Redesigns Onshore Alaska Shale Oil Well

Australia's 88 Energy Ltd. said the design for a well that will target an untested liquids-rich shale play in the onshore North Slope of Alaska has been revised from a lateral to vertical completion, and will be subject to multi-stage stimulation and subsequent flow test.

In a statement Monday, West Perth-based 88 Energy said the design for the Icewine No. 2 well had been changed during the third quarter, and will be spud on schedule during 1Q2017. The well, part of a joint venture (JV) between the junior explorer and Houston-based Burgundy Xploration LLC, will target the Brookian Formation, which is adjacent to the Prudhoe Bay reservoir.

88 Energy owns a 77.5% working interest (WI) and serves as operator for the Icewine project, which includes 271,000 gross onshore acres. The JV formed in November 2014 and completed its first well in the project area, Icewine No. 1, in late 2015.

The announcement over the redesign of the Icewine No. 2 well comes less than a week after 88 Energy said it had reached an agreement with two undisclosed U.S.-based institutional investors to raise gross proceeds of AU$11 million (US$8.36 million). Pursuant to the agreement, the company will issue 275 million ordinary shares of no par value at a price of AU$0.04 (US$0.03) per new ordinary share. 88 Energy also issued 137.5 million in unlisted options to investors.

The company said it will use the net proceeds from the offering to strengthen its balance sheet, and expects to have AU$28.2 million (US$21.44 million) in cash once complete.

During 3Q2016, 88 Energy said it made significant progress interpreting preliminary 2D seismic data of the Icewine acreage. The company said it estimates the acreage could hold 758 million bbl gross (587 million bbl net) mean recoverable oil across five prospective fields: Alpha, Bravo, Golf, India and Juliet. 88 Energy said the Alpha prospect -- which holds a gross mean of 118 million bbl -- is the closest to existing infrastructure, including the Trans-Alaska Pipeline and the Dalton Highway.

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