88 Energy (LON:88E, ASX:88E) has received contradictory results from its drilling of the Icewine Number One exploration well, onshore Alaska.
The dual-listed company said core was successfully acquired in the HRZ interval from 11,075 feet to 11,165' with a 96% recovery factor. While coring the HRZ interval, a pronounced increase in heavy gas fractions was exhibited in both the gas chromatograph and mass spectrometer; additionally, oil shows with cut and fluorescence were observed in cuttings returned to surface.
Once the core was laid down and cut into three feet intervals for shipping, however, an additional analysis of rock chips taken directly from the core was undertaken, and no cut or fluorescence was observed in these samples.
The company speculated that the contra-indicative heavy gases and shows while drilling compared to the results from the post-drilling analysis may be the result of contamination, such as oil or grease build-up, in the mud system.
The core, isotubes of gas collected from the formation while drilling and mud samples have been sent to the lab for analysis. The reason for the contradictory results will be determined in due course, along with results from the planned evaluation programme on the core, the company said.
The uncertainty hit the share price, with the stock off by around one-fifth in early trading in London, but the company cautioned that it is too early to make any definitive statements regarding the thermal maturity of the HRZ shale formation at Icewine number one; however, it is likely that a gas/condensate phase has been encountered, which bodes well for the thermal maturity model at Project Icewine, in a general sense.
"Preliminary results remain supportive of the HRZ play at Project Icewine; however, evaluation has only just commenced and uncertainty remains high,” said Dave Wall, managing director of 88 Energy.
“The 96% recovery factor of the first core in the HRZ interval provides us with an excellent opportunity to evaluate the potentially huge HRZ prize over the coming weeks,” Wall noted.
“Early interpretation of the conventional potential at Project Icewine has been high-graded with evidence of significant amounts of oil and excellent reservoir in the region. Acquisition of 3D seismic will be crucial to unlocking this potential and, with the success of the recent placement and share purchase plan, the company is well placed to execute its seismic strategy in the near term," Wall said.