LONDON, UK: 88 Energy Limited, an oil and gas exploration and production company, has announced the acquisition of a new non-operated working interest in leases and wells in the Permian Basin of Texas, U.S.
The new assets, known as Bighorn Phase 3, are adjacent to the company’s existing Project Longhorn assets, which were acquired in February 2022 and July 2023. The purchase price was US$0.35M, of which 88 Energy paid US$0.26M for a ~64% net working interest.
The remaining interest was acquired by the joint venture partner and operator, Lonestar I, LLC, and retained by existing non-operated partners.
The new acreage covers 1,262 net acres and contains nine low-producing wells and 10 development opportunities with potential in multiple zones. The net 2P reserves of the new assets are estimated at 0.68 MMBOE, based on independent certification. The acquisition represents an attractive low-cost entry of ~US$0.33 per BOE for 88 Energy.
The company plans to increase its production from the new and existing assets by conducting lower-cost workovers and drilling new wells in 2024. The company expects to reach a total gross production of 600 – 675 BOE per day (~75% oil) by the end of 2024.
The new acreage also provides optionality for water disposal, as it contains two injection wells that will be assessed for restoration. To support its development activities, the company recently secured a US$5 million line of credit facility.