Pantheon Resources PLC Operational Update, Alkaid #2 Well (5406A)

TIDMPANR

RNS Number : 5406A

Pantheon Resources PLC

26 September 2022

26(th) September 2022

Pantheon Resources plc

Operational Update, Alkaid #2 Well

Pantheon Resources plc ("Pantheon" or "the Company"), the AIM listed oil and gas company with a 100% working interest in all of its oil projects spanning c. 153,000 acres adjacent and near to transportation and pipeline infrastructure on the Alaska North Slope ("ANS") , provides the following operational update:

Operational Update

The Company is pleased to report that the completion and stimulation phase at Alkaid #2 has concluded, and a production packer has been set. Completion equipment is currently being demobilized and preparations are underway for flow testing. The Company will shortly commence commissioning its facilities which were recently increased in capacity in order to handle potential additional production. A workover rig is estimated to arrive to location over the next week to ten days to install production tubing prior to commencing flow testing operations. A significant amount of fluid was introduced into the well during stimulation procedures which will return first during the 'clean-up phase', prior to the subsequent commencement of oil production later in October, if successful.

Flow Testing at Alkaid #2

In preparation for flow testing, Pantheon has applied to the Alaska Oil and Gas Conservation Commission ("AOGCC") for a long-term pilot production test with a hearing set for 27(th) October to consider gas flaring at the Alkaid #2 well. This hearing is part of the normal process for a long-term pilot production test as the AOGCC must determine when the project is considered to transition from testing a new formation to entering regular production. AOGCC regulations state that gas flaring is permitted during testing but must be limited during regular production operations. The hearing is not anticipated to delay or curtail planned testing operations.

The purpose of the long-term pilot production test of the Alkaid interval is to gather data necessary to understand the characteristics of production from that reservoir. This includes determining the initial production rate, the production decline curve and the Gas to Oil Ratio. This information will then be used to model the potential commerciality of the project, optimize design of production facilities for long-term production, determine the amount of associated gas produced with the oil and identify the most efficient uses for that gas. The hearing will allow the AOGCC commissioners to gather information about the project to determine the length of the testing program and thus when the project should be considered to be in regular production.

Other

As previously reported, Pantheon has contracted the highly regarded consultancy, Schlumberger, to complete a detailed dynamic 3D subsurface visualization of its various Alaska North Slope projects. This work, underway for several months, is advancing well. The information obtained will be used by the Company for its own analysis and will also be included in the data room which Pantheon intends to reopen subsequent to the completion of flow tests, in order to consider possible farm out partners for future project advancement.

Jay Cheatham, CEO, said: " This is the second of two very important milestones for Pantheon this year and a significant step toward potential commercialization of our discoveries on the North Slope. Pantheon has now drilled a horizontal well exceeding 5,000 feet through our target formation from a gravel pad along the Dalton Highway and successfully executed 30 stimulation treatments over that horizontal length.

"Our intention with the long-term pilot production test is to maximize our data collection which, coupled with the upcoming Schlumberger report, will be invaluable to our understanding of the Alkaid interval as well as our wider portfolio of projects. We look forward to updating the market with the initial results of the flow test in due course."

Bob Rosenthal, Technical Director, said: " Pantheon is extremely pleased with the progress towards our first extended flow test operation on our portfolio, which includes some operational 'firsts' for Alaska. Drilling the horizontal and performing the multistage stimulations were the biggest operational risks we faced and we are delighted to have these successfully completed and behind us. We recognize the most effective production of our Alaskan fields is to employ the modern drilling and completion techniques common in the unconventional reservoirs in the Lower 48 states of USA to our conventional sandstone reservoirs on the North Slope. It's a great accomplishment for our team to complete the horizontal drilling and stimulations without incident, whilst also employing drilling and completion techniques which are new to Alaska. Those include using a 'monobore' casing design utilizing two strings; (i) a surface casing, which protects the permafrost, and (ii) a secondary casing which runs from surface to total depth, eliminating any intermediate casing and provides a more cost-effective method for future development wells. We also successfully achieved a large, horizontal, multi-stage completion (30 stage stimulation) which required (new to Alaska) pumping techniques, water management, and supply chain for sand."

-Ends-

Further information:

 
 Pantheon Resources plc                             [phone] 
 Jay Cheatham, CEO 
 Justin Hondris, Director, Finance and Corporate 
  Development 
 Canaccord Genuity plc (Nominated Adviser 
  and broker) 
 Henry Fitzgerald-O'Connor, Gordon Hamilton         [phone] 
 
   BlytheRay 
 Tim Blythe, Megan Ray, Madeleine Gordon-Foxwell    [phone] 
 

Notes to Editors

Pantheon Resources plc is an AIM listed Oil & Gas company focused on several large projects located on the North Slope of Alaska ("ANS"), onshore USA where it has a 100% working interest in 153,000 highly prospective acres with potential for multi billion barrels of oil recoverable. A major differentiator to other ANS projects is its close proximity to transport and pipeline infrastructure which offers a significant competitive advantage to Pantheon, allowing for materially lower capital costs and much quicker development times. 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.

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) incorporated into, or forms part of, this announcement. The information contained within this announcement is considered to be inside information prior to its release.

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September 26, 2022 02:01 ET (06:01 GMT)