88 Energy Ltd (AIM:88E, ASX:88E, OTC:EEENF) told investors it has extended its lease term for a key part of its acreage on Alaska’s North Slope.
The company, in a statement, said that the Alaskan Department of Natural Resources had approved the formation of the ‘Toolik River Unit’ representing a number of leases within the company’s Project Phoenix acreage.
As a result, the Toolik River Unit will now be extended beyond their primary term, with the new date moving out until February 2028.
“Unitisation of the leases in the Toolik River Unit provides an efficient, integrated approach to exploration, delineation, and development of the numerous identified and potential reservoirs,” the company said.
88 Energy noted that the process will enable the partners in this area to assess the potential commercialisation of the acreage and a pathway to development and production.
It also noted that non-drilling exploration work will include a review and analysis of 3D data to help define 'sweet spots' in each of the plays seen at Toolik River, with a view to finding optimal locations for future exploration and appraisal wells.
The upcoming Hickory-1 well is located within the unitised Toolik River area. Drilling is slated to start in March and subject to results the well could undergo flow testing during the 2023/24 season.
Depending upon the outcome of Hickory, a further horizontal well is planned to enable an extended flow test program.
Separately, a section of the eastern part of the Project Phoenix acreage was not included in the unitisation because of limited availability to support its inclusion, and, the company said it may acquire additional data in this area in the future.
"We are pleased that the DNR has approved the Toolik River Unit covering the western and central leases of the Project Phoenix acreage and our plan of exploration,” said 88 Energy managing director Ashley Gilbert in the statement. “This is a further demonstration of the strong support that 88 Energy, and the broader industry, enjoys from the State of Alaska."