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88 Energy adds new reservoirs for Alaskan oil search


88 Energy drilling at its 100 per cent-owned Peregrine oil project in Alaska. Credit: File

Perth-based 88 Energy has bolstered its 100 per cent-owned Peregrine oil project in Alaska, adding two new reservoir intervals to its Harrier prospect, with 180.1 million barrels of oil as a best-case estimate.


Basin modelling has also revealed that Harrier sits in an area of improved reservoir quality and will be tested by the company with the drillbit as a priority.


The Peregrine project is onshore on Alaska’s North Slope and encompasses about 126,000 contiguous acres, some 170km west of the Trans Alaska pipeline system. 88 Energy has identified three oil prospects in the area – Merlin, Harrier and Harrier Deep – and has revealed updated prospective oil resources for the former pair, based off well results at Merlin-2 and further 2D seismic interpretation.


After drilling the Merlin-1 discovery well in 2021 and encountering 41 feet of net log pay across the three reservoir intervals, the company drilled the appraisal well Merlin-2 last year to target thicker reservoir sands to the east.


Although Merlin-2 did hit thicker sands with good hydrocarbon shows, they demonstrated poor reservoir quality and were deemed “tight”, meaning they lacked the porosity and permeability to flow hydrocarbons at an economic rate in their virgin state. The well was plugged and abandoned.


Porosity is the percentage of the rock taken up by pore space. Permeability refers to the ease at which fluids can flow through the pores and essentially represents how well the pores are connected. A fluid can more easily flow through a rock with high permeability.


The company’s current Merlin prospective resource low-case estimate sits at 44.2 million barrels of oil (MMstb), with a best estimate at 160.4 MMstb and the high-case estimate at 567.2 MMstb, with a mean of 259.5 MMstb across two reservoir intervals.


To understand the controls on reservoir quality across its acreage, a basin modelling initiative incorporating the Merlin-2 results was instigated and revealed that the maximum depth of reservoir burial was coincident with reservoir quality. The deeper the reservoir, the tighter it is likely to be.


The model suggests that the reservoir intervals hit at Merlin-2 were about 700m deeper than at Merlin-1 and suggests a porosity drop from 12 per cent at Merlin-1 to just 8.5 per cent at Merlin-2. Similarly, the modelled permeability at Merlin-2 is only 0.09 millidarcies (mD) compared to Merlin-1 where it its modelled at 7mD.


With a handle on the control of reservoir quality, 88 Energy will now focus on areas to the west of its acreage, where the reservoir is shallower and porosity and permeability values are expected to be higher.


The company says its focus going forward will be on its untested Harrier prospect and it is planning to drill its maiden well about 15km north-west of Merlin. Harrier is made up of four reservoir intervals and has newly-assigned prospective volumes for two of them, while the other two remain unchanged from 2019.


Harrier’s prospective volumes are a low-case estimate of 135.8 MMstb, a best guess of 577.4 MMstb and a high-side appraisal of 2494.6 MMstb, with a mean of 1100.9 MMstb.


The newly added resource across the two reservoir intervals has a low-side estimate of 48 MMstb, a best guess of 180.1 MMstb and a high-case of 695.7 MMstb, with a mean of 308 MMstb.


The prospective oil volumes for the Harrier Deep prospect, comprising two reservoir targets, has remained unchanged since 2019. The low-side estimate is 93.7 MMstb, the best guess is 493.5 MMstb and the high-side is 2452.4 MMstb, with a mean of 1062.6 MMstb.


88 Energy now quotes its total average prospective oil resource across the three Peregrine prospects as 2423 MMstb.


With the United States’ Biden administration recently approving the 180,000 barrels of oil per day (bopd) ConocoPhillips Willow development, about 75km north of Harrier, and with Conono drilling more appraisal wells in Harpoon, about 50km to the north, 88 Energy’s model of improving reservoir quality in that direction is strongly supported.


Other operators in the area, again to the north, include Oil Search with its significant 2020 discoveries of Mitquq-sidetrack-1 that tested at 1730 bopd and Stirrup-1 that tested at 3520 bopd.


Is your ASX-listed company doing something interesting? Contact: office@bullsnbears.com.au

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