Project Icewine and 88 Energy Limited: exploring on the North Slope--one step at a time.

AuthorAnderson, Tom
PositionOIL & GAS

88 Energy is not a company that makes grandiose promises about filling TAPS or changing the way that things are done on the North Slope. Rather, the company has chosen to take a disciplined and phased approach to its activities in Alaska. This is an approach that aims to minimize waste-- after all, failing fast is the best way to fail. If that is ultimately the predestined outcome then 88 Energy suggests that there is no way to justify wasting money, time, and effort on science experiments that do not have a clear and direct linkage to value creation.

Joint Venture

The joint venture's history is an interesting one: its early days have been summarized by 88 Energy Managing Director Dave Wall as the "right time, right place--wrong oil price." Without the oil price dropping precipitously at the end of 2014, 88 Energy would not have had a seat at the dealing table with partner Burgundy Xploration-- a company with a strong history of early-stage success in unconventional oil plays.

However, opportunity at the bottom of the cycle meant a deal was struck in late 2014 and the joint venture subsequently went on to raise money, garner debt funding from a major bank, permit, and drill its maiden exploration well--all within twelve months.

As the enticement for new oil and gas exploration in Alaska has been stymied by bureaucratic gridlock, the growing list of investment casualties continues to unnerve prospective resource development in the state.

Despite the looming harbinger of low prices, withdrawn corporate credits, and an executive push for escalated taxes, a stalwart few companies are pressing forward with perseverance, innovation, and renewed belief that the Last Frontier remains a treasure trove of petroleum potential.

"For Project Icewine, Alaska has been that rare and perfect storm of factors that create a real opportunity to build value for our shareholders. Underexplored yet with so much to offer, not just in terms of remaining potential reserves, but also a fiscal system that has provided strong incentive to explore and a proud history of major oil and gas development combined with a can-do mentality," Wall says.

Icewine Prospect

Australian-based 88 Energy is leading a 271,000 gross acre North Slope effort for shale in the Icewine prospect south of Prudhoe Bay off the Dalton Highway. Texan company Burgundy Xploration is the concept originator for the primary play being targeted and the minority partner, with 88 Energy holding a 77.5...

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