LONDON (Alliance News) - Red Emperor Resources NL and 88 Energy Ltd on Monday said they have signed agreements to buy stakes in four leases on the western flank of Alaska's "prolific" North Slope.
The two companies first announced the joint acquisitions in mid-June.
Red Emperor and 88 are, alongside partner Otto Energy Ltd, to buy the majority of Great Bear Petroleum Ventures II LLC's interests in the four leases.
The companies will pay USD500,000 to Great Bear upon execution of the definitive agreements, USD500,000 upon receipt of final permits necessary to drill an initial test well, and will also allow Great Bear a free carry for a 10% working interest.
Red Emperor's working interest will be 31.5% while 88 Energy, who will be the drilling manager, will have a 36.0% interest.
Further, they will pay a performance bond to the State of Alaska for USD3 million.
The western blocks, as the four leases are known, contain a 3D seismic defined oil prospects on the Nanushuk fairway of 400 million barrels of oil, with a geological chance of success of between 25% and 30%.
A testing location has already been identified, and the partners have meet with the Alaska Department of Natural Resource to speed up the necessary approvals, and they hope to begin drilling during the first quarter of 2019.
Red Emperor shares were down 2.4% early Monday at 2.02 pence, having been as high as 2.26p in earlier trading, while 88 shares were 1.6% higher at 1.12p.
