How Will 88 Energy’s Alaska Drilling Plans and Strategic Moves Shape Its Future?

Strategic Funding and Farm-Out Progress at Project Phoenix

88 Energy Limited has made significant strides in advancing its Alaskan portfolio during the September 2025 quarter. Central to this progress is the farm-out agreement with Burgundy Xploration LLC, which commits Burgundy to fund up to US$39 million of Project Phoenix’s future work program costs. This arrangement, structured in two phases, reduces 88 Energy’s financial exposure while enabling critical exploration activities, including the planned drilling of the Franklin Bluffs-1H horizontal well targeted for mid-2026.

The Franklin Bluffs-1H well aims to test the SMD-B reservoir, a well-developed topset sandstone formation with promising reservoir quality confirmed by previous wells and flow tests. The adjacent Dubhe-1 well by Pantheon Resources has further validated the prospectivity of the SMD-B horizon, revealing a hydrocarbon column exceeding expectations and highlighting additional zones of interest. These developments underscore the potential for commercial production and support 88 Energy’s strategy to advance Project Phoenix toward a final development decision.

Advancing Exploration at Project Leonis

Meanwhile, 88 Energy’s wholly owned Project Leonis is progressing well, with planning and permitting for the Tiri-1 exploration well advancing steadily. The well is designed to test multiple reservoirs, including the Canning and USB prospects, with deeper targets under review. The company has received robust operational proposals, positioning it to secure a material carry through the ongoing farm-out process. Drilling is anticipated in the first quarter of 2027, with preparations set to resume in mid-2026.

Namibian License Extension and Regional Exploration Activity

In Namibia, 88 Energy secured a 12-month extension for its PEL 93 license, now valid until October 2026. This extension supports planned high-resolution gravity surveys scheduled for early 2026, focusing on the southern area of the license where multiple structural leads have been identified. The regional exploration environment is gaining momentum, notably with ReconAfrica’s ongoing drilling of the Kavango West-1X well nearby, which shares geological similarities with 88 Energy’s Lead 9 prospect. This regional activity enhances the potential for significant discoveries within the Owambo Basin.

Strategic Divestment and Corporate Updates

Reflecting a disciplined capital approach, 88 Energy completed the divestment of its 65% interest in Project Longhorn in Texas for US$3.25 million. This move avoids exposure to substantial development costs associated with the operator’s multi-well program, preserving cash for core exploration activities. At quarter-end, the company reported a healthy cash balance of A$8.3 million, supporting ongoing operations and exploration expenditures.

Corporate governance also saw a notable change with the retirement of Non-Executive Chairman Philip Byrne, succeeded by Joanne Williams, a petroleum engineer with extensive industry experience. Her leadership is expected to sharpen the company’s focus on its key growth pillars in Alaska and Namibia, leveraging a data-driven approach to exploration.