88 Energy finds Alaska partner for 2027 Augusta-1 well

WAO takes 40% South Prudhoe stake

88 Energy Limited (ASX:88E, AIM: 88E, OTC: EEENF) has found the partner it was seeking for its highest-priority Alaska drilling target. Westlawn Americas Offshore LLC will take a 40% working interest in the South Prudhoe Project and contribute up to US$10.9 million, equivalent to A$15.5 million, towards the Augusta-1 exploration well and associated project costs.

88 Energy will retain a 60% majority interest and operatorship. The transaction follows the South Prudhoe farm-out bids reported earlier this month, when the company said multiple parties were negotiating over participation in the project.

Funding covers roughly half of Augusta-1

WAO’s contribution includes US$9.16 million, or A$13.1 million, towards the well’s current US$17.5 million drilling and evaluation budget. That represents about 52% of well expenditure. WAO will fund the first US$3.6 million of drilling and evaluation costs, then contribute 40% of remaining expenditure in line with its participating interest.

The partner will also provide about US$1.5 million towards non-well costs such as general and administrative expenses, geological and geophysical work and lease rentals, plus US$0.2 million for long-lead items related to a possible two-zone flow test. Including those items, the approved contribution totals approximately US$10.87 million, or A$15.53 million, at the exchange rate used in the announcement.

The deal does not remove 88 Energy’s funding requirement. The company says it remains responsible for about US$8.3 million of Augusta-1 well costs, US$2.3 million of non-well costs and US$0.3 million of flow-test long-lead items. It is assessing strategic initiatives alongside existing cash resources to meet that commitment.

Augusta-1 retains a large but untested target

“88 Energy’s North Slope position showing the planned location of the Augusta-1 exploration well.”

Augusta-1 is scheduled to spud in the first quarter of calendar 2027, within the 2026/27 North Slope winter season. The well is designed to test stacked conventional oil targets in the Ivishak, Kuparuk and Brookian reservoirs, with approximately 133.7 million barrels of gross unrisked 2U prospective resources attributed across the intervals.

That figure is a pre-drill prospective resource estimate, not a reserves figure, discovery or production forecast. The company says the well location, permitting work, access planning and key contracts, including the Nordic-Calista Rig-3 and an Arctic camp, have already advanced. The company had previously reported that more than 80% of Augusta-1 services and long-lead items were selected or secured in its Augusta-1 preparation progress.

Flow test and North Slope expansion remain conditional

A potential two-zone flow test targeting the Ivishak and Kuparuk formations is being planned, but it will proceed only if Augusta-1 results justify further evaluation and the joint venture approves the programme. The current gross estimate is about US$4.5 million, subject to well results, final design, regulatory approvals and possible changes to cost.

The agreement also establishes a framework for an Area of Mutual Interest covering potential future North Slope opportunities. Under that arrangement, 88 Energy says it would retain a 60% interest and operatorship in jointly pursued acreage or projects. Government approval for the assignment of the South Prudhoe interests is still to be sought after completion, leaving drilling execution, funding and the first well results as the next material tests.