Cavendish has maintained its buy recommendation and 19.8p target price on 88 Energy Ltd (AIM:88E, ASX:88E, OTCQB:EEENF, FRA:POQ) after the Alaska-focused oil explorer received farm-out bids for its South Prudhoe acreage and entered commercial negotiations.
The broker values the flagship Augusta-1 exploration well at 22.6p per share net to 88 Energy on an unrisked basis, against a current share price of 1.1p, and describes the well as potentially transformational.
Augusta-1 is designed to test up to 134 million barrels of gross prospective oil resources, with drilling pencilled in for early 2027 subject to completing the farm-out.
88 Energy expects to select a preferred partner by mid-fourth quarter.
