88E on track to spud Merlin-1
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
88 Energy (ASX:88E: AIM:88E) has begun its mobilisation of snow road construction equipment to its Merlin-1 drill site on the North Slope of Alaska.
Merlin-1 is located at 88E’s Peregrine Project in the NPR-A region of the North Slope.
So far, 34 miles of a total ~90 miles of the snow road to Merlin-1 have been constructed and the spud of Merlin-1 remains on schedule for mid-late February 2021.
The spud will target an independently assessed gross prospective resource of 645 million barrels.
Project Peregrine has a 1.6 billion barrel gross mean unrisked recoverable prospective resource. Merlin-1 is the first to drill test this.
The project is located on trend to recent discoveries, including Willow, discovered by oil super major ConocoPhillips (NYSE: COP).
Willow has a resource estimate in the range of between 400-750 million barrels of oil and it is estimated that the project could be producing in excess of 100,000 BOPD.
Once the scheduled spud of Merlin-1 is complete, 88E will then look to drill the Harrier-1 well.
The company has already contracted a rig to the Harrier-1 well site and will drill immediately after Merlin-1 – schedule permitting.
Importantly, 88 Energy has negotiated a farm-out agreement in relation to Project Peregrine with high profile industry participant Alaska Peregrine Development Corporation LLC (APDC).
In order to take a stake of 50% in Project Peregrine, APDC will contribute US$11.3 million towards the cost of the Merlin-1 well which has an estimated gross cost of US$12.6 million.
Notably, all additional costs associated with the project above the US$10 million carry will be borne equally by APDC and 88 Energy.
January has been a big month for 88E
In further news, 88E has been awarded lease AA095899, which is highly prospective for oil and gas as several prospects on the Central North Slope side of the boundary are interpreted to extend into this area.
It is considered likely that a significant portion of these oil pools may be accessed without surface access within the Coastal Plain area.
Promising news was also released earlier in the month in relation to the purchase of the Umiat Oil Field, which is in close proximity to Project Peregrine.
As we have previously reported, Umiat is an historic oil discovery, made in 1945 in shallow Brookian (Nanushuk) sandstones, located immediately adjacent to southern boundary of Project Peregrine.
88 Energy, via its wholly-owned subsidiary Emerald House LLC, entered into a Sale and Purchase Agreement with Malamute Energy, Inc and Renaissance Umiat LLC (Sellers) to acquire the Umiat Oil Field.
The company is also preparing for a fossil fuel recovery this year.
Oil rallied to 10 month highs this month, buoyed by a looming re-opening of the global economy.
Analysts and commentators are predicting a ‘commodity supercycle’ ahead of us.
This also comes as Saudi Arabia made the decision to unilaterally cut production by 1 million barrels a day for February and March.
General Information Only
This material has been prepared by Jason Price. Jason Price is an authorised representative (AR 000296877) of 62 Consulting Pty Limited (ABN 88 664 809 303) (AFSL 548573) (62C), and a Director of S3 Consortium Pty Ltd (trading as StocksDigital).
This material is general advice only and is not an offer for the purchase or sale of any financial product or service. The material is not intended to provide you with personal financial or tax advice and does not take into account your personal objectives, financial situation or needs. Although we believe that the material is correct, no warranty of accuracy, reliability or completeness is given, except for liability under statute which cannot be excluded. Please note that past performance may not be indicative of future performance and that no guarantee of performance, the return of capital or a particular rate of return is given by 62C, Jason Price, StocksDigital, any of their related body corporates or any other person. To the maximum extent possible, 62C, Jason Price, StocksDigital, their related body corporates or any other person do not accept any liability for any statement in this material.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
