Pantheon Resources, the AIM-listed oil and gas company with a 100% interest in all of its oil projects spanning c. 193,000 acres adjacent to and near pipeline and transportation infrastructure on the Alaska North Slope (‘ANS’), has announced that it has formally accepted and paid the award from the State of Alaska Department of Natural Resources (DNR) for the 39,540 acres it was awarded in last year’s state lease sale. The Company is awaiting the formal granting of the leases by the DNR, which is expected in the short term, subject to standard formalities.
25,460 acres of this award are the northern extension (the Chimney) and the pitched-up portion of our Theta West Basin floor fan. The 14,080-acre award covers Pantheon’s Alkaid and Talitha units along the Dalton Highway and the Trans Alaska Pipeline. The new surface covers an extension of existing discoveries that Pantheon was able to delineate from its existing proprietary 3D seismic. While a full evaluation of this new surface is underway, Pantheon expects an improvement to its resource base from this new surface addition in due course. In December 2022, SLB completed phase 1 of its Static and Dynamic reservoir model in which it allocated 10.9 billion barrels of oil to the Basin Floor Fan (‘BFF’) complex portion within Pantheon’s existing leases. Extension to this new surface was not part of the original SLB estimates.
The BFF resources in this additional acreage are structurally higher, or ‘mailbox above’, than the Theta West #1 discovery well. Being structurally taller at shallower reservoir depths produces an expected improvement in reservoir properties due to less compaction due to a shallower Dmax (Maximum Depth of Burial). The expected improvement in reservoir qualities should lead to higher recovery and better reservoir productivity. The Company intends to test the BFF reservoir in these new leases to a depth of approximately 6,200 feet, approximately 750 feet higher than where it was discovered at Theta West #1, in the next Theta West appraisal well. Shallower drill targets reduce drilling costs and, combined with higher expected productivity, should improve the economics of any development at this location. The Theta West #1 well demonstrated that the Company’s pre-drilling expectation for the northern extension of the buildup was likely too conservative and therefore the move to secure additional concessions in what should turn out to be the best quality in this giant discovery.
SLB will incorporate these additional resources into its models, and Netherland Sewell & Associates will incorporate these additional resources into its assessment of contingent resources on the Theta West and Alkaid projects, expected over the summer (Theta West), fall (Alkaid), representing the first independent assessment of recoverable resources identified by Pantheon’s assessment programs in the last two and a half years.
A webinar is scheduled for late June/early July to present an overall plan for Pantheon and the following:
1. Discussion of Pantheon’s corporate strategy to deliver greater value from its significant resources, including a discussion of corporate and operational initiatives.
2. Discussion on the scope of possible resource upgrades associated with this (new) additional acreage.
3. Discussion of the findings from the additional analysis of Alkaid #2 and the Company’s assessment of final recoveries based on Alkaid #2 production and the potential for future wells.
4. Discussion of initiatives to improve operational performance and cost control, including an introduction to recent key hires. Discussion will include a cost analysis of the Alkaid #2 well and steps to work toward a target cost of $13 million per development well.
5. Discussion on the improvements in the Frac design based on the results of Alkaid #2.
6. Discussion of expected production test data and re-entry completion on the SMD horizon at Alkaid #2.
The Company will provide an update at a later date regarding the webinar date.
Jay Cheatham, CEO of Pantheon Resources, said: ‘Pantheon will soon have c. 193,000 leasehold acres with a material resource base of billions of barrels. In the past, we have limited our public profile to reduce competition for acreage compensation while we acquire our current acreage position. Pantheon and its predecessor Great Bear have made significant investments over the past decade securing this vast acreage position, aided by the advantage of exclusive use of c. 1,000 square miles of high-quality 3D seismic. Having now secured the desired surface, Pantheon now intends to raise the profile of its project’s geology without fear of competition and help attract potential development partners.. This process began last week when AHS/Baker Hughes presented a case study using Theta West volatiles analysis at the Society of Petroleum Engineers (SPE) Western Regional meeting in Anchorage. We will also start participating in other relevant industry meetings to raise the profile of the assets.”
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Source: Pantheon Resources