88 Energy confirms second light oil discovery at Project Phoenix, Alaska
() , an Alaska-focused hydrocarbon explorer, issued an update on its flow testing programme at the Hickory-1 discovery well, part of 88 Energy's flagship Project Phoenix on Alaska's North Slope. has conducted two flow tests at Hickory-1, one each for the Upper SFS and SMD-B reservoirs (see map below).
Following the recent announcement of light oil discovery at the Upper SFS reservoir, today 88 Energy confirmed light oil flow from the SMD-B reservoir as well. The SMD-B test produced a peak gauge flow rate of 50 bopd of light oil with c. 39-degree API oil gravity under nitrogen lift, based on multiple samples. The SMB-B reservoir showed little to no measurable associated gas flow, confirming pre-test analysis.
Both tests achieved flow rates from low-volume stimulations over short 20ft vertical intervals, in line with expectations based on results from Pantheon Resources' adjacent acreage. However, unlike Pantheon's results, achieved oil to surface from the USFS reservoir under natural flow.
Next, will seek independent Contingent Resource declarations for both the Upper SFS and Lower SFS reservoirs, based on the observed flow of hydrocarbons to surface. These are expected in H2 2024 and will add to the previously declared 2C contingent resource of 250 mmboe for the deeper BFF reservoir (see map below). Simultaneously, will begin integrating the flow test results into existing models in line with Project Phoenix's development schedule, with commercialisation efforts progressing in parallel.
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Another milestone for 88 Energy and Project Phoenix as the Hickory-1 discovery well has now delivered two successful oil flows and three independent discoveries. These are the USFS results, announced earlier in April, with a peak flow rate of 70 bopd of light oil under natural flow; and today's SMD-B result with a peak flow rate of 50 bopd of light oil under nitrogen lift. These add to the BFF reservoir's previously announced 250 mmboe contingent resource. In total, is targeting 647 mmboe of prospective oil resources at the acreage.
The earlier USFS result represented the first flow of oil to surface at 's Alaska projects, and the first intersection of the USFS reservoir by any company. Adding a second successful result of light oil flow from the shallower SMD-B reservoir further cements the quality and deliverability of the project. Positive results from multiple reservoirs means significant upside in future development via multiple commercialisation options. These include a farm-out to a strategic partner or early capital-light production, given the acreage's infrastructure advantages, being next to the Dalton Highway and Trans-Alaskan Pipeline System.
With both flow tests now complete, will seek independent resource assessments for the two reservoirs. At the same time, the group will begin integrating the flow test results into its development models. Hickory-1 is a vertical well, designed for testing only. For production, long horizontal wells are planned, expected to deliver 6-12 times greater flow rates than what was observed at the flow tests. The project benefits from the ability to produce concurrently from multiple reservoirs in a single development scenario.
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