88 Energy Limited provides the following update related to the testing of its Icewine#2 well, located on the North Slope of Alaska.

Highlights

• Icewine#2 Well Suspended

• HRZ Farm-out Process Commenced

Project Icewine – Icewine#2 Production Testing

After careful consideration, the Icewine Joint Venture made a decision to suspend the Icewine#2 well. The Joint Venture believes that results from the well to date support the potential economic viability of the HRZ shale play and are within the range of outcomes achieved at other early stage unconventional plays, despite not achieving a flow rate that is representative of the capability of the reservoir. Demobilisation of equipment was completed over the weekend in Alaska. The suspension operation has been designed to maximise flexibility for the future use of the wellbore, including the drilling of a horizontal side-track with a multi-stage stimulation.

The Joint Venture believes that the flowback data, combined with results to date from core and logs, demonstrates that the HRZ is comparable to other early-stage commercial unconventional plays and that, as per those plays, progressing to horizontal appraisal wells is now the best use of time and money.

The decision to discontinue flow testing at this point in time was undertaken for many reasons, including:

• An internal belief that a more significant work program is now required to meaningfully de-risk the HRZ play further and that the data obtained to date is sufficient to attract a farm-in partner to undertake this program. This is consistent with the natural progression of development in all other unconventional resource plays.

• The Icewine#2 well has already achieved most of the objectives it was designed for: namely acquisition of a more sophisticated logging suite to complement the core from Icewine#1 and to determine whether a large slickwater stimulation could be executed successfully in the HRZ. Additionally, the overpressure of the HRZ was quantitatively proven and the frac was able to traverse into both the upper and lower HRZ with no frac barriers. These results provide the requisite data to confidently design a horizontal well with a multi-stage stimulation that can access the entire height of the formation.

• Evidence during the fracture stimulation operation indicates that an effective frac has been achieved; however, without micro-seismic monitoring, it is not possible to definitively confirm whether an optimal fracture system has been created utilising a vertical well bore. It is considered likely that the fractures created have not maximised contact with the reservoir and that a multi-stage stimulation in a horizontal well is required to achieve the reservoir connectivity necessary to deliver higher flow rates.

The Joint Venture is in the process of engaging with an experienced service provider to provide state of the art analysis and quality control of the existing dataset, undertake additional work and put together an appropriate forward work program to present to potential farminees.

88E Managing Director, Dave Wall, commented: “Ideally the Icewine#2 well would have delivered a stronger hydrocarbon flow rate and it is disappointing that this was not achieved; however, the Joint Venture has many positive takeaways from the well and remains confident about the potential of the HRZ play. Future evaluation of the large potential already identified is planned to be accomplished via farm-out and this process has already commenced.

The 88E team is also extremely busy maturing our conventional projects at Icewine, Yukon Gold and the Western Blocks and will provide an update on these projects in the near future.”

For more information, please visit: http://88energy.com