Pantheon Resources plc Share News (PANR)

LONDON (Alliance News) - Oil & gas exploration company Pantheon Resources PLC said on Friday it has made substantial progress on its project areas in the Tyler and Polk counties, onshore East Texas.

The VOBM#5 well in Polk County has reached total depth at 14,190 feet, encountering over 60 feet of net pay in the targeted Eagle Ford sandstone formation on progonsis, encountering hydrocarbons while drilling. Production casing has been set and a frac crew has been contracted, who are expected to arrive in the week starting March 19 to frac the well.

If successful, arrangements will start to lay a short pipeline to be connected into the gas processing system.

The planned frac procedure on the VOBM#1 well has been completed, which had the objective of remediating obstructions and skin damage in the wellbore caused by the well having been shut-in for over 18 months, and the effects of migrating formation said.

The well is now currently in the post-frac cleanup phase and is producing at an average rate of 4,000 million cubic feet per day of natural gas and 132 barrels of oil per day.

On the VOBM#4 well in Tyler County, drilling operations have concluded, having perforated the Upper Wilcox formation, and now have been suspended due to not producing hydrocarbons in sufficient commercial quantities. There remains a possible re-entry with a horizontal lateral as has been done elsewhere within the Wilcox formation.

In addition, Pantheon Resources said that two separate US-based groups have started discussions with the operator on the possibility of taking part in a Wilcox play on the acreage. Also, negotiations are ongoing with the operators of two gas processing plants for the supply and processing of gas from the VOS#1 well.

"Crucially, nothing we have seen diminishes our belief in the potential of the acreage. The issues that we have encountered in the Eagle Ford have been wellbore specific operational issues, compounded by the long shut-in periods in our high temperature, high pressure environment. The 301mmboe P50 prospective resource estimate of the acreage potential remains current and is based upon the Eagle Ford sandstone and Austin Chalk plays only. Pantheon has working interest positions between 50% to 75% in all prospects," said Chief Executive Officer Jay Cheatham.

Shares in Pantheon Resources were down 1.0% at 50.00 pence on Friday.