This announcement contains inside information

88 Energy Limited

Hickory-1 Well Spudded

Highlights

·   Drilling of the Hickory-1 exploration well has commenced.

·   Initial surface hole to be drilled to ~3,500 feet, cased and BOP system tested.

·   Hickory-1 well is designed to appraise up to six conventional reservoir targets within the SMD, SFS, BFF and KUP reservoirs and 647 million barrels of oil^1,2.

88 Energy Limited (ASX:88E, AIM:88E, OTC:EEENF) (88 Energy or the Company) is pleased to report that Nordic Calista's Rig-2 commenced drilling of the Hickory-1 exploration well, located in Project Phoenix on the North Slope of Alaska, on the evening of the 9^th of March 2023 (Alaska time).

Hickory-1 is designed to appraise up to six conventional reservoir targets within the SMD, SFS, BFF and KUP reservoirs and 647 million barrels of oil^1,2, and is permitted to a total depth (TD) of up to 12,500 feet. The primary targets for Hickory-1 are the 3 SMD reservoirs (SMD-C, B and A), with SFS and BFF reservoirs considered secondary targets. The KUP reservoir is a tertiary target and will be drilled subject to remaining time in the season, borehole conditions and other technical considerations.

Hickory-1 is planned to be initially drilled to 3,500 feet, with surface casing installed and the Blow-Out Preventer (BOP) system tested. This is anticipated to collectively take up to two weeks. Drilling to TD is then expected to take a further two weeks, including logging while drilling (LWD), at which point wireline logging is scheduled. LWD and mudlogging will provide initial indications as to the prospectivity of the Hickory-1 targets. The wireline program has been specifically designed to collect essential data, necessary to optimise the future flow testing program. This includes multiple side wall coring runs and other specialised tools to enable detailed reservoir characterisation.

Flow testing of the Hickory-1 well is planned to be undertaken during the 2023/24 winter season, subject to well results. This provides ample time post-drilling to optimise the flow test program, design, permitting and implementation.

¹ Cautionary Statement: The estimated quantities of petroleum that may be potentially recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially movable hydrocarbons.

² Mean unrisked resource - Net Entitlement to 88 Energy. Refer announcement released to ASX on 23 August 2022

Figure 1: Hickory-1 well designed to test up to 6 stacked targets.

Figure 2: Nordic Calista Rig-2 and facilities at the Hickory-1 wellsite.

This announcement has been authorised by the Board.

Media and Investor Relations:

88 Energy Ltd

Ashley Gilbert, Managing Director                                              

Tel: +61 8 9485 0990

Email:investor-relations@88energy.com

Finlay Thomson, Investor Relations                                          Tel: +44 7976 248471

Fivemark Partners, Investor and Media Relations                      Tel: +61 410 276 744

Andrew Edge / Michael Vaughan                                                 Tel: +61 422 602 720

EurozHartleys Ltd

Dale Bryan                                                                                   Tel: + 61 8 9268 2829

Cenkos Securities                                                                     Tel: + 44 131 220 6939

Neil McDonald / Derrick Lee

Pursuant to the requirements of the ASX Listing Rules Chapter 5 and the AIM Rules for Companies, the technical information and resource reporting contained in this announcement was prepared by, or under the supervision of, Dr Stephen Staley, who is a Non-Executive Director of the Company. Dr Staley has more than 35 years' experience in the petroleum industry, is a Fellow of the Geological Society of London, and a qualified Geologist/Geophysicist who has sufficient experience that is relevant to the style and nature of the oil prospects under consideration and to the activities discussed in this document. Dr Staley has reviewed the information and supporting documentation referred to in this announcement and considers the resource and reserve estimates to be fairly represented and consents to its release in the form and context in which it appears. His academic qualifications and industry memberships appear on the Company's website and both comply with the criteria for "Competence" under clause 3.1 of the Valmin Code 2015. Terminology and standards adopted by the Society of Petroleum Engineers "Petroleum Resources Management System" have been applied in producing this document.

About Project Phoenix

Project Phoenix (88E 75.2% WI) is located on the central North Slope of Alaska and encompasses approximately 82,846 gross acres. It is situated on-trend to recent discoveries by Pantheon Resources Plc (LSE: PANR) in multiple, newly successful play types across top, slope and bottom-set sands of the Mid Schrader Bluff, Canning and Seabee formations. Independent mapping has demonstrated that these plays extend into the Phoenix acreage.

Project Phoenix holds an estimated unrisked conventional total of 647MMbbl of prospective oil resources (mean unrisked, net to 88E), independently assessed by Lee Keeling and Associates (LKA) in Q3 2022 (see 88E ASX release dated 23 August 2022). The acreage has been significantly de-risked by the recent Pantheon drilling and flow tests on their adjacent acreage to the North, coupled with data from Icewine-1 well logs (encountered 380 ft of net oil pay within SMD sands) and a modern 3D seismic data set (FB3D).

Figure 1: Project Phoenix lease area, including mapped play fairways, Franklin Bluffs 3D area and planned Hickory-1 well location.

1.    88 Energy net resources have been calculated using a 75.227% working interest and a 16.5% royalty.

2.    The unrisked means, which have been arithmetically summed, are not representative of expected total from the prospects and implies a success case in all reservoir intervals. 88 Energy cautions that the arithmetically summed 1U estimate may be a conservative estimate and the arithmetically summed 3U estimate may be optimistic when compared to a statistical aggregation of probability distributions.

3.    COS represents the geological chance of success as assessed by 88 Energy and reviewed and endorsed by LKA. 

4.    Prospects are subject to a phase risk (oil vs gas). Chance of oil has been assessed as 100% for all targets except for the Kuparuk Formation which has been assessed as 70%.  Phase risk has not been applied to the unrisked numbers.

5.    The Prospective Resources have not been adjusted for the chance of development. Quantifying the chance of development (COD) requires consideration of both economic and other contingencies, such as legal, regulatory, market access, political, social license, internal and external approvals and commitment to project finance and development timing. As many of these factors are outside the knowledge of LKA they must be used with caution.

6.    Please refer to ASX announcement dated 23 August 2022 for further details in relation to the prospective resources estimate and associated risking with Phoenix.

Cautionary Statement: The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially movable hydrocarbons.