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88 Energy clarifies points from third party shale report

Today, 88 Energy clarified that the D&M report estimates resource potential over the entire 272,000 acres at Project Icewine.

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The D&M report estimated some 1.4bn barrels of oil equivalent resources.

88 Energy (LON:88E) has issued a statement to clarify a number of points following yesterday’s announcement regarding the third party assessment by DeGolyer & MacNaughton (D&M).

There was a typographical error in the D&M report attached to the announcement, the company said.

Today, 88 Energy clarified that the D&M report estimates resource potential over the entire 272,000 acres at Project Icewine.

It also said the D&M report had considered all relevant information up to March 31 2016, and clarified that detailed flow rate modelling was not done by D&M as part of the report’s preparation.

The D&M report estimated some 1.4bn barrels of oil equivalent resources in the HRZ shale, seen in the recently drilled Icewine well, on Alaska’s North Slope.

D&M also upgraded its view on the ‘probability of geologic chance of success’ to 60%, from 40%.

Icewine’s ‘productive acres’ are estimated by G&M to span 42% of the project’s total area.

Internally, meanwhile, the company’s joint venture estimates some 3.6bn barrels across 70% of the Project Icewine area.

The company highlighted that the assumptions used by D&M are largely consistent with the internal view of the project, and the main difference relates to the views of how much of acreage would prove productive in the ‘success case’.

It added that the internal view is based on experience and past expertise within the joint venture relating to the development of the Eagle Ford shale, as well as confirmation of the pre-drill thermal maturity model by the Icewine#1 exploration well.

“D&M's assumption is largely driven by statistical analysis over a larger selection of global shale plays at a similar stage of life cycle,” the company explained.

Quick facts: 88 Energy Ltd

Price: 0.29 GBX

AIM:88E
Market: AIM
Market Cap: £20.62 m
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