Otto Energy Limited advises that, via its wholly owned subsidiary Borealis Alaska LLC, it has executed definitive agreements with Great Bear Petroleum, along with the Consortium Partners, 88 Energy (Captivate Energy Alaska, Inc) and Red Emperor, to acquire the majority of Great Bear’s working interest in exchange for drilling a commitment well on the Western Blocks prior to 30 May 2019.

The Western Blocks contain a 3D seismic defined oil prospect in the successful Nanushuk play fairway with a gross best estimate prospective resource volume of 400 MMbbls and a geological chance of success in the range of 25-30%. Otto’s 18.75% net revenue interest (before Great Bear 10% back in) in the prospect would be 75 MMbbls.

Pursuant to the agreement, the Consortium Partners have funded their share of a US$3,000,000 performance bond to the State of Alaska and a US$500,000 cash payment to Great Bear as part of the consideration for the acquisition of the working interests in the Western Blocks.

Internal interpretation by incoming operator 88 Energy of the 3D seismic over the Western Blocks has confirmed the original interpretation by Otto’s technical team, which identified the 400 million barrel prospect. A location to optimally test the prospect has been selected and permitting is underway, ahead of scheduled drilling in the first quarter of 2019.