Company Update

RNS Number : 3863X

Pantheon Resources PLC

19 November 2014

 



Press release

19 November 2014

Pantheon Resources plc

Company Update

Pantheon Resources plc  ("Pantheon" or "the Company"), the AIM-quoted oil and gas company with a 50% working interest in several projects within Tyler and Polk Counties, East Texas, is pleased to provide the following operational update.

Proposed Drilling Activity

The Joint Venture ("JV") has now commenced the process of identifying and tendering for a suitable rig for the drilling of the first well (the "LP Offset well") on its Tyler County prospect, East Texas. The prospect has a gross estimated P₅₀ prospective resource (recoverable) of 53 Mmboe (millions of barrels of oil equivalent) (Pantheon 50%) and it is estimated that this well will spud in 1Q 2015. Upon completion of this well, it is the intention to commence preparations for the drilling of the second well in the programme, on the new Prospect A, located adjacent to the prolific Double A Wells field in Polk County. The new Prospect A has a gross estimated P₅₀ prospective resource (recoverable) of 58 Mmboe (Pantheon 50%).

The LP Offset well contains two separate and independent targets. The primary target is the Eagleford/Woodbine sandstone formation, which is geologically analogous to the prolific Double A Wells field located nearby. The JV's confidence in this target is reinforced because the proposed well location directly offsets the LP2 well, which has been producing from this same Eagleford/Woodbine formation for over eight years. 

The secondary target in the LP Offset well is the shallower Austin Chalk formation, which is also proven to exist on the JV acreage. The Austin Chalk was confirmed to be present in both the offsetting LP2 well, and also the VRU#1 well drilled by the JV in 2009. The well will be drilled vertically to penetrate the primary target and is not expected to require artificial stimulation (fracking). If the primary Eagleford/Woodbine Sandstone target is successful, it is expected that the well will be produced from this formation. If however this primary target is unsuccessful, then the lower zone will be plugged and a horizontal section will be drilled to intercept the shallower Austin Chalk formation.

The selection of the optimum rig for drilling the LP Offset well is an extremely important one, involving a comprehensive analysis of various factors including availability, mechanical characteristics, service history and quality/experience of the crew.

The JV believes that one outcome of the recent declines in oil prices will be an increased availability of rigs and a reduction in costs. The JV is in active communication with a number of drilling companies to secure the optimum rig as soon as it becomes available.

Jay Cheatham, CEO of Pantheon, stated, "Last month I stated that this is one of the most exciting plays that I have been involved with in my long career. This view remains unchanged. Recent weakness in the oil price only serves to highlight the attractiveness of this project given the outstanding reservoir quality believed to exist in the Eagleford/Woodbine sandstone, which is an order of magnitude superior to that of the typical shale plays in North America. When combined with our proximity to infrastructure and the favourable economic terms that exist in the state of Texas, our wells are projected to be profitable at oil prices below US$50 per barrel."

Bobby Gray, Managing Partner of Vision Gas Resources LLC (Operator), stated, "We have invested a number of years getting this project to this advanced stage and developing a unique understanding of the Eagleford/Woodbine sandstones via a rigorous analysis of well cores and well data.  We are very excited about drilling our first well of the new campaign, expected for 1Q 2015. We are active in the rig market on behalf of the JV, with the sole purpose of identifying the optimum rig for our requirements."

Further information:

Pantheon Resources plc                                                                                                               [phone]

Jay Cheatham, CEO

Justin Hondris, Director, Finance and Corporate Development

Oriel Securities Limited (Nominated Adviser and broker)                                            [phone]

Michael Shaw

Ashton Clanfield

For further information on Pantheon Resources plc, see the website at: www.pantheonresources.com

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

In accordance with the AIM Rules - Note for Mining and Oil & Gas Companies - June 2009, the information contained in this announcement has been reviewed and signed off by Jay Cheatham, a qualified Chemical & Petroleum Engineer, who has over 40 years' relevant experience within the sector. The technical disclosure in this announcement complies with the SPE/WPC standard.

 

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