Analysts at UK-based stockbroker Cavendish have repeated a bullish call on 88 Energy Ltd (AIM:88E, ASX:88E, OTC:EEENF) as the small-cap exploration company today confirmed it has extended its venture onshore Namibia.
Cavendish today repeated a remarkable 24.6p price target, which compares to 88 Energy’s market price of just over a penny.
Exploration in Namibia is not central to the valuation and target set out by analyst James McCormack, though the early-stage African play does provide new potential catalysts.
In Namibia, 88 Energy and partner Monitor Exploration announced a 12-month extension to its Namibia venture, where it plans to undertake a programme of early-stage exploration.
The AIM-quoted firm holds a 20% stake in the project, alongside partner Monitor Exploration, and together they plan to conduct a high-resolution airborne survey, estimate a prospective resource, and identify potential exploration well sites.
Meanwhile, 88 Energy also noted that regional interest is building, with ReconAfrica set to drill the Kavango West 1X well in the adjacent Damara Fold Belt in July. This well is targeting a large fold structure with a thick Otavi carbonate reservoir and mature source rocks, and it's described by 88 Energy as similar to Lead 9.
Cavendish analyst McCormack highlighted the potential for this third-party well to create value in the surrounding areas.
“Success at the Kavango West-1X well would be a major catalyst for the basin and further derisk the Otavi play,” he said in the note.
Exploration planned for the next year
Exploration will be funded equally between 88 Energy and Monitor, up to $1 million.
A new licence deadline is set to 2 October 2026.
Its anticipated the airborne gravity survey will get underway in the second half of 2025, focusing on the southern portion of the licence area.
This follows identification of Lead 9 during the 2024 2D seismic program.
‘Lead 9’ is a 100 square kilometre anticlinal structure, the explorer noted.
Exploration partner Monitor, in a statement, commented: “Our early results are pointing to something potentially significant in the southern area of PEL 93 in the Owambo Basin.
“With multiple datasets aligning and the prospect of even larger structures emerging, the joint venture is building momentum towards a drilling event and what could be a basin opening discovery with broad implications for all of Namibia given the significance in unlocking a major new hydrocarbon play."