What's up guys and welcome back to the
channel so today I want to talk about 88 Energy
This oil stock is listed across
multiple stock exchanges such as on the
OTCQB:EEENF and 88E
on both the aim and the uk and the asx
in australia.
This stock has gotten a lot of attention
over the past 24 hours and has quickly
become one of the most searched penny
stocks across social media.
In this video I will look at the reason
for the sudden interest but is 88 energy
really everything that investors think
that it is (OTC:EEENF)
In this video I will look at the very
latest news and later on I will look at
the charts to further show what I think
will happen next and why.
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and i'm not a financial advisor but if
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let's get into it.
First of all, Who are 88 energy?
88 energy is a junior oil and gas
company engaged in the exploration and
production of oil and gas at the at the
alaska north slope region.
The north slope region of alaska is home
to some of the largest oil and gas
fields in the world and is north
america's most prolific oil producing
region
the company's goal is to build a
successful exploration and production
company that delivers material benefits
to shareholders
they have a simple strategy identify
highly prospective world-class assets
add significant value to the assets in
order to realize value for shareholders
and they aim to achieve this by
targeting overlooked or emerging play
types to capitalize on opportunities
prior to larger industry players moving
in
88 energy operates three main projects
a 193 thousand acre operation at the
site of project icewine
a 195 000 acre project at the site of
project peregrine
and as we can see here from the north
slope oil and gas major discoveries map
both project icewine and peregrine are
located in the same region as copperwork
and prudhoe bay,
which was discovered in 1968 and has
produced 15 billion barrels of oil to
date.
88 energy began working on project
icewine in 2015 and significantly
increased acreage up to its current 193,000
acres (eeenf)
then there is the umiet oil field
where 88 energy holds 100 working
interest in the acreage located
immediately adjacent to project
peregrine
yukon leases located near point thompson
in january 2021 the company increased
its position and discussions continue
with nearby lease
owners to explore joint development
opportunities plans for future
exploration continue and will be subject
to fair amount and other discussions
and finally we have project longhorn
the oil and gas production assets
collectively known as project longhorn
are located in the permian basin in
texas the acquisition represents 88
energy's first move into producing oil
and gas assets and is in line with the
company's strategy to build a successful
exploration and production company
project longhorn contains
well-understood geology with low
technical risk and provides and provides
near-term upside
project longhorn attractive production
growth forecast
those planned capital development
activities have been certified proven
reserves given their low risk nature
with forecast growth peak production
rate
of 1300 boe per day in 2024
based on planned work program
giving a five-year operating cash flow
of 40 million dollars based on 80
dollars per barrel now i'll talk more
about the impact of the price per barrel
of oil later in this video and
predictions for both the 88 energy share
price as well as oil prices in general
so stick around for that
but 88 energy's focus remains on the
alaskan slope and the significant upside
from the icewine and peregrine projects
earlier this week 88 energy announced
they have completed drilling of the
merlin too well in alaska after reaching
its target depth of
7334 feet and has now ceased
now i'm sure a lot of you watching this
video are probably already aware of this
so I will just go over this very briefly
the arctic fox rig has exceeded
expectations in terms of drilling
performance with the well-reaching
td safely and efficiently
all three target reservoirs that is the
nanya shook
in 20 in 19 and in 18
were penetrated and elevated gas
readings while cutting samples revealed
oil shows
in all target intervals
as stated here
initial observations of lwd which is
logging while drilling
logs and drill cuttings
collected throughout the drilling
operations reveal target intervals are
thicker than those encountered in merlin
one as anticipated pre-drill with oil
shows noted under white light in the
three target
reservoirs
while fluorescence has also been
observed in numerous samples when placed
under an ultraviolet light
an indication of oil presence and we can
see that here in the diagram provided in
this press release finally significant
mud gas peaks were detected across all
sequences in the nanoshock
with marked increases in the heavier
carbon compounds c2 to c5
observed
in each
a wireline logging program
will now start to confirm if any
hydrocarbons are present in what
quantities and the flow potential a
further update on the evaluation of the
merlin 2 results will be provided
following completion of the wireline
logging program
ashley gilbert has said the results to
date for merlin too well are very
encouraging
and we look forward to results
from the pending wireling programme
which is set to be conducted over the
next seven to ten days following
completion of this program we hope to be
able to confirm the presence of mobile
hydrocarbons and the discovery at merlin
too
so all of this is very positive news for
88 energy and although this is the
latest official press release
from the company this is not all that
happened this week.
Let's not forget that this press release
was tuesday so the wireline program is
well underway and really this should be
completed within the next few days
now 88 energy stock had been dropping
all week from over three cents on
tuesday it dropped on wednesday and
thursday and again on friday dropping to
just 0.025
before something happened on friday and
the volume went way up and the share
price began to rally for example the
average trading volume at 88 over the
past 30 days is 77 million shares but on
friday this flew up to over 93 million
and as of now EEENF
is by far the most
searched penny stock according to
lion.com.
So what caused this?
On friday 88 energy released a very
simple video on their youtube channel
with the title merlin 2 wire line setup
commences
and the video is very simply just this
truck arriving on site when I first seen
this I did not see any importance to
this,
and to be honest I didn't see
why they would even bother making this
video.
But then reading between the lines we
can see that the truck in question in
this video is from schulenberger
and this is what has piqued interest
right now this is a major company in
this field
$SLB
a new york stock exchange listed with a
market cap of over 61 billion dollars
with over 86 000 employees and annual
revenue of over 23 billion
in fact according to wikipedia
schulenberger is the world's largest
offshore drilling company it is the
biggest offshore drilling contractor in
terms of revenue in the entire world and
social media has jumped on this for
example this is a tweet I seen yesterday
evening these guys are huge
they are keen hunters smelling fresh
blood if a farm out is possible a joint
venture
with slb
should be the very best way to make it
possible
slb's home is houston I wonder if this
is a result of the recent texas meetings
and let's not forget about project
longhorn the oil and gas production
assets located in the permian basin in
texas
longhorn represents 88 energies first
move into producing oil and gas assets
in line with the strategy to build a
successful exploration and production
company also in the past couple of weeks
since my last 88 energy video 88 have
released their annual report so let's
take a quick look at the financial side
of the company
but first of all the company is audited
by the very reputable bdo who have given
88 energy a clean audit report with no
disclaimers or concerns so that's a very
good start
looking at the income statement 88
energy had other income of 4.4 million
and a loss from operations for the year
of just 2.4 million this is
significantly less than 2020's loss of
22 million
however there is a gain here from
exchange differences on translation of
foreign operations meaning that 88
energy have actually finished 2021 with
a small 2.4 million profit but this is
really not worth talking about
a company's balance sheet is the real
measure of the company's health and 88
energy's balance sheet is very strong
they have total assets of 145 million
dollars and total liabilities of less
than 6 million now a large part of the
assets here is made up of exploration
and evaluation expenditure of 101
million but even if we were to compare
88 liabilities with just their cash only
their cash position is greater than 5
times their total liabilities at 32
million versus
5.9 million
so right now 88 energy is in a very
healthy position and this does not
include the 32 million dollars raised in
a placement back in february which i
spoke about in my previous video if you
want to check this video out there is a
link in the description below I feel
that all investors in this stock should
be very aware of the share structure and
the level of dilution that exists here
and the impact that this could have
on the amount of movement that is
possible for the 88 energy share price
looking at the charts we can see that 88
energy has made big gains from the low
point towards the end of december
going from as low as 0.0175
right up to four cents in february but
has now pulled back
0.0278
and looking closer at this over the past
three months we can clearly see that
every time eeee in f stock
has dropped into this range
it has found support and went on a rally
in both february and at the start of
march the stock made big gains as
indicated here by the yellow and blue
arrows given that the current price is
only 0.0278
and that a major support exists at
0.0260
i feel that there is a huge opportunity
here right now in the short term
especially with the volume we see on
friday evening and the level of interest
in the stock over the weekend
it is also worth noting that the price
per barrel of oil is increasing again
having dipped two weeks ago
the general trend is showing no signs of
stopping and it is predicted that oil
could reach between 200 and 250 dollars
a barrel before long
this article was written on thursday and
i have included a link to this in the
description for anyone who wants to have
a read of this
anyways my short-term estimate is for a
potential upside of at least 35
with a downside risk of less than six
percent but that is just my analysis
and is definitely not financial advice i
am not a financial advisor and this is
just my opinion backed up by what I can
clearly see in the market but how high
do you think that 88 energy share price
can realistically go drop me a comment
and let me know what you think remember
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in the next update