88 Energy releases “encouraging” operations update from Alaska

88 Energy uncovers various prospective zones

88 Energy (LON:88E) announced that the results from the Merlin-1 well were “very encouraging” for the potential at Project Peregrine, in the NPR-A region of the North Slope of Alaska.

Various prospective zones were uncovered, matching the shows and logs found while drilling, as part of the first go of the wireline programme.

The explorer said one of these zones is considered to be a new prospective horizon within the Nanushuk Formation that may be wholly within the Project Peregrine acreage and was not one of the pre-drill targets.

The other zone is interpreted to be shared with one of the zones in the Harrier prospect, to the north of Merlin.

The AIM-listed company said its initial observations indicated the presence of an oil signature in the fluid, which was followed by slugging of hydrocarbon and water. 88 Energy’s statement said this is often a precursor to hydrocarbon flow from the reservoir.

However, the company had to pull out of the hole for repairs before obtaining samples due to equipment failure.

After repairs were completed, the run back in hole encountered several sticky sections, but the sampling tool did not re-establish good communication.

A decision was made to move to the next shallowest prospective zone, which had exhibited good oil shows and petrophysical characteristics, but wellbore condition issues prevented a test as the tool became stuck.

The tool was freed but the risk of returning to that zone was deemed too high.

Not being able to sample these two most prospective zones does not preclude a discovery, 88 Energy noted, but analysis of sidewall cores and potentially further drilling may be required for confirmation.

Several samples were taken in zones interpreted to be less prospective on the way out of the hole, all of which contained low saturations of hydrocarbons, which will now be sent to a laboratory for testing.

The presence of hydrocarbons in these zones is considered encouraging for regional prospectivity but does not constitute a discovery due to the low saturation levels.

Managing director of 88 Energy David Wall commented on the company’s findings:

“We appreciate that these early results may be difficult to interpret. That is because we do not yet have all the data required to allow interpretation,” said managing director David Wall in a release.”

“This means some uncertainty remains; however, it is already clear that Merlin-1 has delivered by far the best outcome of any of the five wells drilled by 88 Energy in Alaska over the last six years.”

“The company is extremely proud to have been able to achieve this result from a wildcat exploration well drilled on sparse 2D seismic, 60kms from the nearest control well, in the middle of the Arctic winter.”