TIDMPANR
RNS Number : 7585Y
Pantheon Resources PLC
17 May 2021
17 May 2021
Pantheon Resources plc
("Pantheon" or the "Company")
Resource Upgrade - Basin Floor Fan
Pantheon Resources, the AIM-quoted oil and gas exploration
Company with a 100% working interest in projects spanning c.160,000
acres, covered by 1,000 square miles of 3D seismic, conveniently
located adjacent to transportation and pipeline infrastructure on
the Alaska North Slope, is pleased to provide the following
resource upgrade on its Basin Floor Fan Complex, which spans both
the Theta West project and Talitha Unit.
Highlights
-- Company P50 estimate of 12.1 billion barrels ("BBL") of oil
in place ("OIP") and of 1.41 billion barrels of Recoverable oil in
the Basin Floor Fan Complex, consisting of 11.0 billion barrels OIP
and 1.20 billion barrels recoverable in the Lower Basin Floor Fan
and 1.10 billion barrels OIP and 0.21 billion barrels recoverable
in the Upper Basin Floor Fan
-- Given discoveries in the Basin Floor Fan Complex, most
recently at Talitha #A and previously at Pipeline State #1, the
Company believes the above estimates could be categorized as
Contingent Resources
-- The Basin Floor Fan Complex is now referred to as the Theta
West Project and includes the Talitha Unit
-- Theta West contains two separate reservoirs, the Upper Basin
Floor Fan ("UBFF") and the Lower Basin Floor Fan ("LBFF")
-- VAS analysis confirmed the 600 ft of oil bearing interval in
the LBFF Complex with +35 API oil at Talitha #A
-- Pantheon expects a thicker reservoir section in the LBFF,
with better porosity and permeability at the updip Theta West
location
-- Theta West, due to similar reservoir characteristics, is
interpreted as a direct analogue to the producing Tarn oilfield
deposition where recoveries are estimated to exceed 40%. Whilst
Theta West appears larger in potential size, its depositional
setting is deeper and therefore recoveries are not expected to be
as high as 40%
Background to the Resource Estimate
The Company has now completed its analysis of the Basin Floor
Fan Complex encountered in the Talitha #A well and confirms its
interpretation that the Basin Floor Fan Complex encountered at
Talitha is mapped to extend 10 miles into the shallower (updip)
Theta West Project area. Given the Basin Floor Fan's crossover into
these two different project areas, and to avoid potential
confusion, all future references to the Basin Floor Fan resource
(both in the Talitha Unit and in the Theta West project area) will
hereafter be singularly classified by reference to the 'Theta West'
project (not Talitha). The Theta West project has been at the
forefront of Pantheon's leasing strategy over the past two years
where the Company strategically secured a major acreage position
which has captured the majority of the Basin Floor Fan play.
Resource Estimate - Basin Floor Fan
The Company estimates the Basin Floor Fan (Theta West), where
Pantheon has a 100% working interest, to contain 12.1 billion
barrels of oil in place and a P50 Recoverable Resource of 1.41 BBL
(based upon a modelled 11% recovery factor in the LBFF and a 20%
recovery factor in the UBFF) as a most likely case under primary
recovery. The UBFF depth of burial was much shallower than the
LBFF, and thus a higher recovery factor has been modelled. The
Theta West Basin Floor Fan also extends east of Talitha and was
penetrated in the Pipeline State #1 well, substantially downdip
from Talitha A, where it was also confirmed to be oil bearing. As a
result of these two discoveries in the Basin Floor Fan, the Company
believe the above estimate can be categorized as a Contingent
Resource.
The Talitha #A well targeted four independent horizons; (i) the
Shelf Margin Deltaic ("SMD"), (ii) the Slope Fan System, (iii) the
Basin Floor Fan ("BFF" - hereafter classified under the Theta West
project area), and (iv) the Kuparuk. A fifth prospective zone was
also encountered during drilling. All of these formations were
penetrated by the Talitha #A wellbore, and all were confirmed as
oil bearing and will be the focus of flow testing operations in
this coming winter's drilling season.
The Talitha #A well which had intermittent flow of oil, gas, and
water to surface from the Kuparuk horizon during testing of that
zone, penetrated the Basin Floor Fan in a structurally down dip
location, approximately 1500 ft down dip and 10 miles from the
crest of the structure to the northwest. Theta West contains two
separate reservoirs, which collectively comprise today's resource
assessment:
(i) the Upper Basin Floor Fan, and
(ii) the Lower Basin Floor Fan
The LBFF is approximately 600 ft thick at Talith #A with
approximately 50% net to gross sand ratio over approximately
100,000 acres. The Company's modelling suggests, based on 3D
seismic, that the formation doubles in thickness at its (updip)
crest, some 1500 ft shallower than at Talitha #A. The UBFF is oil
bearing in the Talitha #A location. The Company's analysis
indicates the reservoir should be between 100 to 200 feet thick at
the crestal location. The UBFF covers approximately 28,000 acres.
Accordingly, Pantheon's modelling predicts thicker reservoir
sections with superior porosity and permeability at the updip
portion of Theta West. Drilling this updip (shallower) crestal
location should also lead to reduced drilling costs. Data obtained
during drilling of Talitha #A is of an exceptionally high quality
and has allowed Pantheon's geologic, geophysical, and engineering
teams to have confidence in its analysis. This analysis has been
supported by the independent Volatiles Analysis Service ("VAS")
completed by the experts at Advanced Hydrocarbon Stratigraphy
("AHS") / Baker Hughes. The VAS confirmed the presence of
continuous stacked oil-bearing reservoir zones over a 3700 ft
interval with +35 API oil at Talitha #A. A copy of their report is
available on the Pantheon website under the 'Shareholder Documents'
section.
Analysis continues on the SMD, SFS and Kuparuk zones encountered
at Talitha #A. The Company will announce key conclusions from those
horizons when work is completed.
Pantheon's Alaskan projects benefits from their close proximity
to both the Trans Alaska Pipeline System ("TAPS") and the Dalton
Highway, the single land supply and oil export route on the North
Slope, both of which run through Pantheon leasehold (100% owned by
the State of Alaska). This proximity offers tremendous advantages
to Pantheon over other North Slope projects, allowing for easier
access, materially minimizing both development costs and
environmental considerations, as well as offering the opportunity
for more rapid development time horizons.
Bob Rosenthal, Technical Director of Pantheon Resources,
commented, "The Theta West project has become a giant play for us
and we believe represents one of the biggest plays in Alaska. Basin
Floor Fans are typically huge traps, explored offshore in deep
water basins. Our Theta West Basin Floor Fan is a similar trap,
with the benefit of being located onshore USA, adjacent to the
underutilized TAPS pipeline infrastructure."
"The technical and engineering work to assimilate the
high-quality data obtained from Talitha #A and rework our geologic
models has been impressive. Despite the very large resource
estimates provided today, we have been conservative in determining
this resource number. We modelled a +/- 11% recovery factor for the
LBFF and a +/- 20% recovery factor for the UBFF. By comparison, the
ultimate recoveries for the analogous and nearby Tarn field are
estimated at >40%. The key to higher recoveries in the LBFF lies
in the application of engineering techniques to exploit a 600 ft to
1200 ft thick reservoir in the most efficient manner. We believe
the size and location of Theta West, combined with a comparatively
low-cost drilling operation, should attract strong farm-in
interest."
Jay Cheatham, CEO of Pantheon Resources, commented, "We set out
to prove that the Talitha and Theta West projects had the potential
to contain over one billion barrels of oil recoverable from four
distinct zones. Our drilling and testing operations have generated
extremely high quality data which has led us to interpret that just
one of our five prospective zones has the potential to achieve that
target of greater than one billion barrels of recoverable oil, even
despite using conservative recovery factors. I have often said
good, big oil fields get bigger over time. As a reminder, the
original estimate for oil in place at Prudhoe Bay was 10 billion
barrels of oil, with three billion barrels recoverable. Current
estimates predict that Prudhoe Bay will actually recover more than
15 billion barrels, or more than the original OIP estimate."
"Theta West has the potential to grow both in size and through
higher recoveries. It is also worth remembering that Talitha
discovered oil in the Kuparuk, Shelf Margin Deltaic and Slope Fan
System. We will soon turn our attention to updating our resource
estimates for those formations. We believe the Talitha #A well,
which was proven as oil bearing across all our main targets, was an
outstanding exploratory success for our Company. It has allowed us
to upgrade our entire portfolio and has given us numerous high
impact projects to pursue which have all been significantly
de-risked."
-Ends-
Cautionary Statement: The estimated quantities of petroleum that
may be potentially recovered by the application of a future
development project relate to undiscovered accumulations. These
estimates have both an associated risk of discovery and a risk of
development. Further exploration, appraisal and evaluation are
required to determine the existence of a significant quantity of
potentially movable hydrocarbons.
Further information:
Pantheon Resources plc +44 20 7484 5361
Jay Cheatham, CEO
Justin Hondris, Director, Finance and Corporate
Development
Canaccord Genuity plc (Nominated Adviser and
broker) +44 20 7523 8000
Henry Fitzgerald-O'Connor, James Asensio, Angelos
Vlatakis
Blytheweigh +44 20 7138 3204
Tim Blythe, Megan Ray, Alice McLaren, Madeleine
Gordon-Foxwell
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 Bob Rosenthal, a
qualified Petroleum Geologist who has over 40 years' relevant
experience within the sector.
The Resource estimates has been reported in accordance with SPE
standards.
The information contained within this RNS is considered to be
inside information prior to its release. 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.
Glossary
API The American Petroleum Institute gravity, or API
gravity , is a measure of how heavy or light a petroleum
liquid is compared to water: if its API gravity is
greater than 10, it is lighter and floats on water;
if less than 10, it is heavier and sinks
Contingent Resource Contingent Resources are those quantities of petroleum
estimated, as of a given date, to be potentially
recoverable from known accumulations, by the application
of development project(s) not currently considered
to be commercial owing to one or more contingencies.
Contingent Resources have an associated chance of
development. Contingent Resources may include, for
example, projects for which there are currently no
viable markets, or where commercial recovery is dependent
on technology under development, or where evaluation
of the accumulation is insufficient to clearly assess
commerciality. Contingent Resources are further categorized
in accordance with the range of uncertainty associated
with the estimates and should be sub- classified
based on project maturity and/or economic status
Ft Feet
BOPD Barrels of oil per day
P50 There should be at least a 50% probability (P50)
that the quantities actually recovered will equal
or exceed the best estimate
Notes to Editors
Pantheon Resources plc is an AIM listed Oil & Gas
exploration and production focused on several large projects
located on the North Slope of Alaska ("ANS"), onshore USA. A major
differentiator to other ANS projects is its proximity to transport
and pipeline infrastructure. The Group's stated objective is to
create material value for its stakeholders through oil exploration,
appraisal and development activities in high impact, highly
prospective conventional assets in the USA; a highly established
region for energy production with infrastructure, skilled personnel
and low sovereign risk. All operations are onshore USA, with
drilling costs materially below that of offshore wells.
On the North Slope of Alaska, Pantheon holds working interests
of 100% in projects spanning c.160,000 acres and covered by c.1,000
square miles of proprietary 3D seismic. The Company has received
Independent Expert Reports certifying a Contingent Resource of 76.5
MMBO (million barrels of oil) recoverable on its Greater Alkaid
project and, prior to drilling it's Talitha #A well, a 302 MMBO
Prospective Resource at its Talitha project.
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