03/17/2022
Excitement and anticipation continue to build for 88 Energy Ltd (AIM:88E, ASX:88E, OTC:EEENF)’s new well in Alaska, as the company shared a video of the exploration manager arriving to site by plane.
The video shows the drill rig in operation at the Merlin-2 site where the exploration company is testing large targets, estimated at some 652mln barrels, which were identified in the prior Merlin discovery well.
https://youtu.be/f9DBFkp9keA
The 8,000 ft drill programme began on 7 March and, subject to results, it is planned that it will include logging while drilling, mudlogging and wireline logging before a production test.
Stockbroker Cenkos in a recent note repeated a ‘buy’ recommendation following the spudding of the Merlin-2 well. Analyst James McCormack highlighted his valuation of 13.6p per share compared to a prevailing price of 2.26p.
“Situated east and downdip of the Merlin-1 well, the Merlin-2 well is expected to encounter thicker reservoir sections and higher permeability/porosity sands, allowing for a more productive reservoir,” the analyst said.
He added: “A successful result at the Merlin-2 well would also substantially de-risk both the Merlin-1A and Harrier Nanushuk targets, which combined contain an additional 485mmbbls of mean unrisked net prospective resources.”
McCormack meanwhile noted that although Canada, Greenland and Norway have yet to develop their Arctic resources, interest in the US remains strong among both majors and independents.
The North Slope is one of the most attractive places to explore for hydrocarbons globally and the announcement by President Joe Biden to ban imports of Russian oil and gas puts increased focus on domestic US assets, he added.
