- Oil explorer 88 Energy (88E) is nearly ready to begin drilling at its jointly held project in Alaska
- Prominent oil and gas producer Premier Oil bought a 60 per cent interest in the project in August for almost $34 million
- Recently, an Alaskan regulatory body gave the companies approval to start drilling the Charlie-1 well
- Next month, the final permit will be submitted and approvals is expected for January
- As it stands, 88 Energy says it on track for spudding to commence in February
- 88 Energy’s share price is remaining flat today, currently trading for 1.9 cents each
Oil explorer 88 Energy is almost ready to begin drilling at its Alaskan-based project following the completion of a farm-out agreement.
In August, 88 Energy sold a 60 per cent interest in the Icewine project to the prominent U.K. oil and gas producer Premier Oil – Premier is listed on the London Stock Exchange, trading shares for £89.04 each.
Premier will pay almost $34 million (US$23 million) under the purchase terms. The funding will be used to establish an appraisal at the Charlie-1 oil well.
88 Energy will keep a 30 per cent interest in the project, while the remaining 10 per cent is held by U.S. oil company Burgundy Xploration.
In Alaska, the Department of Natural Resources gave the go-ahead to the companies operational plan for the Charlie-1 well. Today’s market update outlined the significance of the permit the company had obtained.
Next month, 88 Energy will submit its last major permit which it expects will receive approval by January. This is in line with spudding to commence in February.
The Charlie-1 well is being developed to expand on oil giant BP’s Malguk-1 well which it drilled back in 1991. “Elevated resistivity and mud gas readings” were identified across a number of areas, however, were never tested due to operational complications.
88 Energy and its joint venture partners, Premier oil and Burgundy Xploration, plan to use updated and current techniques to develop the well.
Following today’s well update, 88 Energy’s share price is remaining flat and trading for 1.9 cents each.