88 Energy Limited (ASX:88E) plunges on operational update

88 Energy Limited provided an update related to the testing of its Icewine#2 well that is located on the North Slope of Alaska. It was reported that on 26 June 2018, the flowback rate was averaging 30 barrels of water per day on a variable choke setting (currently 36/64”). Further, Wellhead pressure has been managed lower to 32psi to reduce back pressure in the system. These results from the flowback were within the range of expectations. Since the Company provided a last update, it was seen that the reduction in nitrogen injection rate to minimise the impact of a perceived downhole choke did not result in an increase in the rate of flowback of stimulation fluid or gas.

In fact, it was found that the total clean up fluid that returned (net of diesel for freeze protection and any other fluids introduced as part of the current operation) since commencement of flowback on 12th June 2018 was 1,264 barrels which reflected 100 per cent of stimulation fluid. Moreover, it was worth noting that total fluid returned during the entire Icewine#2 flowback operation, including last year, was recorded at 6,797 barrels which meant that 24.4 per cent of the frac fluid was injected as compared to target percentage return of at least 30 per cent. The Board is sure that the reservoir quality and geo-mechanical properties of the HRZ will keep providing the requisite ingredients to attract a farm-in partner. Further, the company has excellent operating capability and has high quality database comprising both modern reconnaissance 2D and focused 3D seismic. The stock (ASX:88E) price slipped by 4.34 per cent and traded at $0.022 (as on 29 June 2018; 14:14 PM AEST).


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