Pantheon Resources rises on latest North Slope work

Alaska North Slope-focussed oil and gas company Pantheon Resources said in an update on Tuesday that Theta West 1 had reached total depth at 8,450 feet, having drilled through both the Upper and Lower Basin Floor Fan target horizons, encountering around 1,160 gross feet of oil-bearing reservoir across both.

The AIM-traded firm said the data so far indicated the reservoir quality was “superior” to Talitha A, with high-quality light oil encountered across the entire section.

It said it was now preparing to set casing, before flow testing within both horizons over the coming weeks.

The Upper Basin Floor Fan was encountered between 6,800 and 7,000 feet, and the Lower between 7,450 feet and 8,410 feet.

Pantheon said the top of the Upper was located about 150 feet higher than pre-drill estimates.

It said wellbore conditions in the shallower sections above the primary objective, combined with “extremely cold” weather, had prevented it from conducting wireline operations in the open hole.

However, the firm said it undertook logging-while-drilling operations, which included resistivity, gamma ray, neutron density, formation density along with gas chromatography readings, which provided “excellent quality” data indicating the presence of hydrocarbons in the targeted horizons.

Samples analysed to date by AHS Baker Hughes also confirmed the presence of light oil within the Upper Basin Floor Fan and the top portion of the Lower, consistent with the logging-while-drilling data.

Pantheon said AHS Baker Hughes was yet to complete analysis of the lower portion of the Lower Basin Floor Fan.

Operations at the well site were impacted by the cold temperatures, with a wind chill of 55 degrees Celsius below zero, which caused some disruption through a number of equipment failures and a reduced ability for personnel to work outside.

Due to the wellbore conditions and weather, the company said it was unable to core, or to collect open hole wireline logs, although the data gathered to date was of sufficient quality to allow the company to analyse the well bore.

Pantheon said it had decided to preserve the well bore and run casing before undertaking cased hole logging and subsequent flow testing.

The board warned that it was too early to draw final conclusions as to the ultimate potential of the well, which could only be assessed after flow testing was complete.

“This is an encouraging result,” said technical director Bob Rosenthal.

“Our initial assessment of 1,160 feet of light hydrocarbons 1,500 feet structurally updip from Talitha, with better porosities, is in line with our pre-drill geologic model.

“It is very much a case of so far, so good.”

At Talitha A, meanwhile, Pantheon said testing of the Slope Fan System was now underway, with results to be reported when complete.

As with the Basin Floor Fan at Talitha A, the Slope was also a secondary target in a “suboptimal location” in the well, and thus the objectives for testing were to prove the movability of hydrocarbons, and confirm high-quality light oil.

No resource estimates had been provided to date for the Slope Fan System.

“We are cautiously optimistic that testing will prove the commercial viability of the Basin Floor Fan at this location, with all indications so far supporting our pre-drill assumptions,” said chief executive officer Jay Cheatham.

“We look forward to updating shareholders in due course.”

At 1027 GMT, shares in Pantheon Resources were up 10.68% at 137.68p.