88 Energy executes farm-out at Project Peregrine

88 Energy updated the market on its projects on the North Slope of Alaska on Friday, reporting that a farm-out had been executed at Project Peregrine.

The AIM-traded firm said it had executed definitive documents with Alaska Peregrine Development Company (APDC) for the farmout of its 100%-owned Project Peregrine, located in the NPR-A region of the North Slope of Alaska.

It said APDC would earn 50% in Project Peregrine by contributing $11.3m towards the cost of the Merlin-1 well, which had an estimated gross cost of $12.6m.

88 Energy would contribute $1.3m, representing its 50% share over and above a $10m carry.

All additional costs associated with the project above the $10m carry would be borne equally by APDC and 88 Energy.

“Being able to secure a farmout deal with a high calibre partner on close to two for one deal terms in the current oil and gas environment is a major coup for our shareholders,” said managing director Dave Wall.

“This is especially true given the short time period in which it has been achieved as we only acquired Project Peregrine in July of this year.

“APDC is a close cultural fit for our proposed future plans for Project Peregrine and it has been a pleasure to work with them to finalise the farmout deal within a tight timeframe.”

At 0937 GMT, shares in 88 Energy were up 2.56% at 0.4p.