KeyFacts Energy: 88 Energy US Alaska country profile

Highlights

• Merlin-1 post well evaluation successfully demonstrates presence of oil in the N20 and N18 targets; plus a new target (N19) was penetrated;
• 41 feet of net log pay interpreted across the three reservoir intervals;
• Geochemical analysis determined oil with an estimated API gravity between mid-30 to low-40 API (light oil);
• Merlin-1 results incorporated into an updated Project Peregrine independent unrisked net entitlement mean total Prospective Resource estimate of 1.6 billion barrels with Merlin-2 geological chance of success assessed as 56%; and
• Merlin-2 appraisal drilling locations identified to the east of Merlin-1 where enhanced reservoir thickness and quality expected, with appraisal drilling planned for Q1 2022.

88 Energy today announced that the post-well evaluation of the Merlin-1 well (which was drilled in March 2021 to a depth of 5,267 feet) has successfully demonstrated the presence of oil in multiple stacked sequences in the Cretaceous Nanushuk Formation (N20 and N18 targets). An additional new target, the N19 sand, that was not previously mapped, also returned a strong hydrocarbon signature following geochemical analysis.

Wireline analysis and core data correlate to 41 feet of net log pay across the 3 reservoir intervals. In addition, results of the post well formation evaluation, including core and Reservoir Description Tool (RDTTM) data have determined the presence of moveable hydrocarbons. Geochemical analysis of the cores has determined the presence of a light oil with an estimated API gravity between mid-30 to low40 API.

Given the up-dip location of the Merlin-1 well with respect to the N20, N19 and N18 reservoirs, hydrocarbon shows and sand quality at this location was consistent with pre-drill expectations. 88 Energy has identified appraisal drilling locations to the east of the Merlin-1 well, closer to the shelf break, where enhanced reservoir thickness and quality are expected.

Post well analysis has also determined that the N14 horizon, one of the targets of the Merlin-1 well, was not intersected, as it is believed to lie below the total depth of the well. The N14 prospect remains a target of interest and the Merlin-1 well may be re-entered in order to test this prospective target as part of the Company’s future drilling activities at Project Peregrine.

88 Energy Managing Director, Ashley Gilbert, commented:
“We are thrilled with the results from the Merlin-1 exploration well. This is the best well we’ve drilled on the North Slope of Alaska to date, with light oil detected in the Nanushuk across three separate horizons. Whilst we have a lot more work to do, the Merlin-1 well has confirmed an active petroleum system in the Peregrine acreage. Results of this significance, together with the magnitude of the opportunity, merit a pace of evaluation that facilitates further drilling and seismic in upcoming winter seasons.”

“The company is advancing planning for an appraisal well following the Merlin-1 well, which is scheduled for the Alaskan winter drilling window in Q1 2022.”

Merlin-1

Merlin-1 is located in the NPR-A region of the North Slope of Alaska. 88 Energy has a 100% working interest in the well and is Operator. The well was spud on 10th March 2021 and was drilled to a Total Depth of 5,267’. Multiple prospective pay zones in sandstone reservoir between depths of 3,400’ and 5,100’ have been identified. Fluids recovered via downhole sampling from three Lower Grandstand units has confirmed, through laboratory analysis, to be primarily water, though carbon isotope analysis of these fluids deemed the respective source rocks to be in the oil window. Note: the most prospective zones in the Merlin-1 well, namely N20, N19 and N18, were not able to be sampled due to operational issues.