88 Energy Ltd (AIM:88E, ASX:88E, OTC:EEENF) has completed drilling of the Merlin-2 well in Alaska after reaching its target depth of 7,334 feet.
All three target reservoirs - Nanushuk 20 (N20), N19 and N18 - were penetrated with elevated gas readings while cutting samples revealed oil shows in all target intervals, said a statement.
"Initial observations of LWD [logging while drilling] logs and drill cuttings collected throughout the drilling operations revealed target intervals are thicker than those encountered in Merlin-1 as anticipated pre-drill, with oil shows noted under white light in the three target Nanushuk reservoirs," added the company.
"Finally, significant mud gas peaks were detected across all target sequences in the Nanushuk, with marked increases in the heavier carbon compounds (C2-C5) observed in each."
Wireline logging will now start to confirm if any hydrocarbons are present, in what quantities and the flow potential.
Ashley Gilbert, 88’s managing director, said: "The results to date from the Merlin-2 well are encouraging.
"We look forward to results from the pending wireline program, which is set to be conducted over the next 7 to 10 days.
“Following completion of this program, we hope to be able to confirm the presence of mobile hydrocarbons, and a discovery, at Merlin-2."
88 added the Arctic Fox rig exceeded expectations in terms of drilling performance, with the well reaching its target depth safely and efficiently.