88E to flow test well next to $711M neighbour

Our oil and gas exploration Investment, 88 Energy (ASX: 88E), just put out an update on its projects in Alaska, USA.

88E made a discovery on its Hickory-1 well on the block next door to $711M Pantheon Resources.

88E’s Hickory-1 well sits immediately to the south of Pantheon’s blocks and along trend from the two most recent wells Pantheon drilled (Dubhe-1 and Megrez-1):

(Source)

88E confirmed today that it is planning on a flow test for its Hickory-1 well in Q3-2026.

88E actually signed a farm-out deal for the flow test so will be fully carried for the appraisal well.

88E’s two phased farm-out deal with its JV partner will see 88E have a 25% free carried interest in the project structured as follows:

• Phase 1 (65% ownership) - Burgundy to pay for ~A$45M of 88E’s share in budgeted CY25/26 costs. This includes lease costs, drilling a horizontal well and flow testing on the project.
• Phase 2 (75% ownership) - Burgundy to pay for another ~A$15M in costs (drilling another well or alternative capital programme) after which they will own 75% of the project and 88E 25%.

88E confirmed today that its JV partner Burgundy was now progressing its IPO in the US with extensions granted on the farm-out obligations to 30 April 2026.

A reminder of what 88E has at Hickory-1:

With the Hickory-1 well 88E hit:

• 52 feet of net pay across the SMD-B reservoir (one of many reservoirs 88E intercepted)
• Porosity ranging from 5–11%
• Initial flow testing from a vertical well which brought oil samples up to surface with a low gas to oil ratio.

(Source)

That was all from a vertical well.

Now 88E and its JV partner will come back and a horizontal section with stimulation where we hope to see flow rates on the well improve…

Interestingly, 88E will be testing the same reservoir unit that neighbour Pantheon Resources confirmed a 565 ft hydrocarbon column in the SMD-B with its most recent Dubhe-1 well.

(Source)

Now we wait to see Burgundy (88E’s JV partner) complete its IPO, raise capital and start funding the work on 88E’s ground.

What else is 88E up to in Alaska?

88E is also looking to farm-out its 100% owned Project Leonis.

Leonis is separate from 88E’s Project Phoenix which was the focus of today’s announcement.

At Leonis 88E has defined a 381 million barrel prospective resource for the project (net to 88E).

Next at Leonis, 88E is working on what it is calling a “targeted farm-out”.

88E has previously mentioned that London group Stellar Energy Advisors were working on the farm-out deal and said that they already had “multiple parties” showing interest in the project.

88E had already designed its first exploration well ‘Tiri-1’ which would be right next to the old Hemi Springs Unit #3 well drilled by ARCO in 1985 which hit >200ft of net pay across one reservoir (USB).

At Leonis, 88E is working with a theory that the field could be similar to the already producing fields to the north (Polaris, West Sak, and Orion fields).

We also noticed 88E recently picked up additional ground in this part of Alaska, covering approximately 34,560 acres across two focus areas:

It looks like it's still fairly early days on these projects but we are looking forward to seeing 88E work these up especially considering 88E holds 100% of the leases and 88E has already started thinking about a “Farm-out” and “a multi-zone exploration well”.

On these projects 88E is targeting the “Ivishak Formation” which has produced over 13 billion barrels of oil in this part of the world AND there are regional wells (Hemi Springs State-1:) which flowed oil to surface at ~101–385 barrels of oil per day.

The latest on 88E’s Namibian asset

🔄 Maiden prospective resource estimate for Namibian Asset (H1 2025)

88E currently owns 20% of the Namibian acreage with a right to earn up to 45% - joint ventured with Monitor Exploration.

Monitor is a private explorer with links to one of our other Investments Invictus Energy.

88E and Monitor recently completed a 203km 2D seismic survey on the project and late last year after processing all the data identified 10 independent structural closures across the project.

Next for the project, was to put together all available data and deliver an independently certified Prospective Resource estimate.

We want to see 88E declare a maiden prospective resource across the ~10 independent structures mapped on its project.

Ultimately the prospective resource estimate is a pre-cursor to 88E defining drill targets on it’s Namibian acreage - which is the 4th objective we are tracking for 88E in our Investment Memo:

Objective #4: Firm up drill target at the Namibian asset

Milestones

✅ 2D seismic program starts
✅ 2D seismic program completed
✅ 2D seismic results & interpretation
🔄 Maiden prospective resource estimate
🔲 Primary drill target selected

Source: “What we want to see 88E deliver” - 88E Investment Memo 20 May 2024