Source: Pand P Studio, Shutterstock
- 88 Energy Limited has been in pursuit of commencement of the spud at Merlin-1 well slated for March 2021.
- The Company has completed mobilisation of the drill Rig 111.
- 88E anticipates receiving results within the next four weeks and has planned several other activities to be undertaken at the Merlin-1 well.
88 Energy Limited (ASX:88E) is an oil and gas explorer who has been pursuing the spud at Merlin-1 well. For this purpose, 88E had previously updated about the mobilisation of the drill Rig 111 to the drill location at Merlin-1.
Project Peregrine and Recent Nanushuk Discoveries (Source: ASX Announcement 23 February 2021)
Lately, the Company had initiated drilling at the Merlin-1 well on 10 March 2021, where drilling shall initially reach a depth of 1,500’. Subsequently, 88E plans to install surface casing and test the Blow Out Preventer system, which is anticipated to go on for over a week.
Further, 88E plans to deepen the well via the target horizons in the Nanushuk Formation to the highest total depth of 6,000’. The Company is optimistic that it shall receive initial indications about the well's prospective nature through logging while drilling and mudlogging, which is anticipated to take 3-5 days.
Merlin-1 – on trend to large Willow oil field (Source: ASX Announcement 23 February 2021)
After this, 88E plans to run a sophisticated wireline logging suite, comprising cores and downhole sampling and the wire logging is anticipated to last from 5 days to a week.
88E plans to complete the well with casing and conducting a flow test once it received favourable results from the wireline logging.
IMPORTANT UPDATE: What is latest with 88 Energy (ASX:88E)?
Moreover, the Company share of the cost of Merlin-1 has grown to US$4 million from US$1.4 million, as part of a standard cost review. There are several reasons cited by 88E for such an increase in the cost of Merlin-1 well, including:
- Postponements in relation to the Executive Order concerning the issue of the Permit to Drill.
- Costs related to the closure and re-start while clarification was obtained about the Executive Order.
- Delays due to cold weather.
- Successive knock on to mobilisation costs because of accelerating activities to align with the operational schedule.
Presently, 88E remains suitably funded with an existing cash standing of US$13 million, which indicates more funds in contrast to its share of the drilling of Merlin-1 and 88E’s other proposed activities.
The Company anticipates receiving the results from this drilling at Merlin-1 well within the next four weeks.
88E stock is trading at $0.0010 (AEDT 02:20 pm) on 12 March 2021, up by 31.25%..
*All financial are in AUD, unless specified.