88 Energy Acquires the Umiat Oil Field on Alaska's North Slope
Perth-based 88 Energy Ltd. has entered into an agreement with privately-held Malamute Energy Inc. to acquire its 100% working interest (76% net revenue interest) in the Umiat oil field located on Alaska’s North Slope, in exchange for a 4% Overriding Royalty Interest (ORRI) and the assumption of abandonment liabilities for two historic wells (at an estimated cost of approximately US$1 million).
The Umiat field spans over two leases covering an area of 17,633 acres in Alaska’s North Slope, located adjacent to the southern boundary of the 88 Energy owned and operated Project Peregrine. The leases form part of a unit that was formed in September 2019 with an initial 10-year term.
The field was discovered in 1945, and contains the Umiat-23H well, which was tested with a maximum flow rate of 800 barrels per day (b/d) and a sustained flow of 200 b/d, and also contains 223 sq. km. of 3D seismic data acquired in 2008. Work plans include undertaking a full field review to determine the oil price at which the field may be commercial as a stand-alone development. The work commitments for the leases include the drilling of an exploration or appraisal well by August 31st, 2022.
“Our operational activity at Project Peregrine has provided 88E with a unique position from which to acquire the Umiat Oil Field at an opportunistic price point. The asset has potential to add significant value for shareholders, possibly as a standalone development but certainly in the event that there is a material discovery in the imminent Project Peregrine drilling program,” said Dave Wall, Managing Director of 88 Energy.
Dual-listed on the ASX and the AIM market of the London Stock Exchange, 88 Energy is currently focused on oil exploration and development projects in Alaska. Minnesota-based Malamute Energy is primarily engaged in exploration and production activities in the United States.
The transaction is subject to customary closing conditions, including regulatory approvals.