In August 2015, Otto acquired the right to earn an interest, through staged capital injections, in a substantial acreage position on the highly prospective, oil prone, onshore Alaskan North Slope held by Great Bear Petroleum Operating ("Great Bear").
Through its agreements with Great Bear, Otto acquired an 8% and 10.8% working interest (equivalent to 58,334 net acres) in two areas of Alaskan North Slope exploration acreage held by Great Bear.
Great Bear is a private exploration company focused exclusively on exploring and developing conventional and unconventional resources on the North Slope of Alaska.
Great Bear is the dominant exploration acreage holder in this highly prospective basin; holding 579,374 gross acres in a major play fairway south of the Prudhoe Bay and Kuparuk fields. Great Bear has undertaken significant exploration work on the acreage since 2011 with a cumulative spend in excess of US$200 million, supported by generous tax rebates from the State of Alaska.
The work conducted includes:
Acquisition and processing of approximately 1,800 km2 of 3D seismic data.
Drilling of two unconventional stratigraphic test wells which cored three primary unconventional targets. Results from these wells indicate that the majority of the Great Bear acreage is expected to be liquids rich. These wells also encountered light oil in various conventional formations.
Drilling of a conventional exploration well (Alkaid-1) which specifically targeted a 3D defined Brookian reservoir. The Alkaid well results are under evaluation.
The extensive, modern 3D seismic coverage, existing well control and proximity to the all-weather Dalton Highway and Trans-Alaskan Pipeline System (TAPS) means that the Great Bear joint venture is well positioned for exploration.
On 30 September, Otto elected to make a further staged payment to Great Bear securing tenure to the acreage and concluding the farmin obligations.
During the June 2016 quarter Great Bear completed the acquisition of 1,170 km2 of new 3D seismic over the remainder of the acreage. Prospect and lead inventory is being developed ahead of drilling anticipated to commence in early 2017.