Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
…on Webinar Day – after all, the 900mmbbls OIP / 76mmbbls recoverable is old data, based on the 3D and the drilling of Alkaid#1.
At Alkaid#2’s initial, vertical, pilot drilling, they drilled 300ft deeper (than at Alkaid#1) and at the TD of 8,584 ft they were still in oil and estimated that the oil potentially went yet another ~200ft down.
RNS 29 July 2022:
“-- Drilled 300 ft deeper than Alkaid #1, all of which was oil bearing reservoir. Pantheon estimates the potential for an additional +/- 200 ft of oil bearing section below total depth ("TD")”
Why stop drilling while still in oil? Well, you may recall:
“Under instruction from the Alaska Oil and Gas Conservation Commission (AOGCC), drilling was stopped at 8,584 ft, despite not having reached the bottom of the Alkaid Deep section, to allow a sufficient margin to avoid contact with the high pressure HRZ zone and possible fault.”
And of course, the 900mmbbls OIP / 76mmbbls recoverable, is only calling for ~8.5% recovery - we start using reinjection of gas and that recovery rate should improve.
IMHO
...we need to get capital back to the E&P industry and encourage them to deploy it.”
“We agree that many elements of ESG investing have been disastrous and applaud the state treasurers for their resolute actions.”
An interesting open letter sent to State Treasurers, by Goehring & Rozencwajg - Natural Resource Investors
https://blog.gorozen.com/blog/letter-to-treasurers
The Gas cap estimated as <2% of the gross volume of Alkaid deep reservoir, [so <2% of 900mm bbls]
according to Bob on Jan 23 Webinar at 20:08 time
https://www.youtube.com/watch?v=XWCLbBliIfw&t=1208s
As Alkaid#2 cleans up more of its fracking fluids and we all await the latest flow testing results.
A reminder - Michael Duncan, regarding the previous flow rates:
“… But once again, the big question is deliverability….. and based on all our observations – just that, and thus far, the answer is, yes. It models as a commercial development…. “
“I can’t say this enough - there’s so much reason for upside.….. change our completion techniques - refine our processing at the surface. There’s - there’s so many efficiency gains ahead….. I’m very excited about it.”
At 52min:51secs in:
https://www.youtube.com/watch?v=XWCLbBliIfw&t=3171s
the Jan 23 webinar.
Peaky, my understanding is that:
the small gas cap was an unexpected surprise – if they had know about it they would have drilled the horizontal deeper, so the fracks didn’t radiate to intercept it.
As they didn’t expect it, do they yet have an estimate as to how much gas is going to be expelled from it – I suspect they need to see the decline curve of the gas to estimate that.
The condensates and Natural Gas Liquids tending to be atomised in the Natural Gas stream and so they will tend to only be around in quantity as long as the gas cap is producing.
So, if the gas cap is long term, then to buy a separator would no doubt be a worthwhile investment [even at the ~$1mil I’ve heard bandied about] But if the gas cap were to deplete in 1 or 2 month’s time, then maybe not.
Of course if the gas cap does deplete quite soon, then as we heard from Michael Duncan, that could be good news for the flow of oil, as the path that had been taken by the gas in the well bore then becomes available for use by more oil.
https://www.share-talk.com/pantheon-resources-aimpanr-annual-general-meeting-share-talk-webinar/
Fractionally above the rightmost orange airfield light.
https://weathercams.faa.gov/map/-148.38131,70.1187,-148.29341,70.13328/airport/SCC/details/camera/11668/loop-full
And bullish calls: China’s recovery will lead to rebounding oil prices
- some predicting Brent to climb back above $100 a barrel this year.
Well now - that might help, somewhat.
https://uk.yahoo.com/finance/news/china-oil-buying-spree-boost-060100605.html
... perspective on Pantheon Resources’ recent developments:
https://drive.google.com/file/d/1kNRxgulLVbHKLM_mU-2YbS-8a2ib8t_y/view
Recalling from the 8Dec2021 RNS:
“Extensive State 16-2LN-CC production test successfully concluded;
Proven rate-constrained production high of 1,083 barrels of oil equivalent per day;
Simulation modelling indicates potential rates of 2,100 barrels of oil equivalent per day;
Highly successful appraisal suggests large hydrocarbon resource.”
“The test was rate-constrained to minimise flow assurance issues from salt deposition in the well bore. Future flow assurance issues are expected to be mitigated when the well's final completion equipment is installed.”
Our 6feb23 RNS clearly says, early March spud:
“Permitting for the Hickory-1 well is now largely complete with the approval of the AOGCC PTD, ahead of targeted spud in early March 2023.”
So, if all goes to plan, there should be enough time –
Pantheon have just used the rig – not to drill, but to pull the production tubing out of the vertical of their Alkaid#2 well to give the full diameter access afforded by the well’s outer casing ( the production tubing is a narrow pipe fitting inside the outer steel casing of the well - it enables the well pressure to better lift the oil to the surface because of its lesser cross-sectional area compared to that of the outer casing.) – now with that out of the way they are sending down a long tube - from a coiled tubing unit - to reach right to the tip of their 1 mile long horizontal well section and use this to clean out the excess fracking sand they have down there.
They are scheduled to doing the sand cleanout this weekend.
Then the Coiled Tubing Unit will move off the well and the Rig will move back onto the well - to reinstall the production tubing that it pulled out earlier.
If still unsure of the layout of this well pipework, Scroll halfway down this article to view a simple diagram of the relationship between the outer well casing and the inner, narrower production tubing.
https://cargohandbook.com/Oil_Well_Casing
Now, you don't see those words that often.
"Our drilling success combined with the field's strong natural aquifer support that allow for recovery factors beyond 30% has underpinned a world class oil operation that is expected to deliver immense free cash flow for the next 20 years."
>30% recovery - these appear to be rather impressive horizontal wells - that feeling supported, for instance, by the
3rdNov22 RNS: PetroTal Announces Robust Initial Production For Well 13H Average production over 8,000 bopd during first week.
And I guess this line, from today's RNS, kind of sums up "We see significant upside with respect to PUD, Probable, and Possible reserve values that are not reflected in our current market valuation."
IMHO
matt - agreed, but if hypothetically there was a buyer for the company, they might view such a large 3P as a safety net for the 1P+2P valuation - which if over £2/share doesn't look shabby - they'd of course have to discount that value maybe say 33% to give them their profit on the project - still looks to me very healthy from where the sp is now.
IMHO DYOR
So at todays US$1.23 = £1
Looks like they're saying:
NPV10 after tax value per share:
1P = 73p
2P = 142p
3P = 232p
so to me, that totals 447p NPV10 after tax, value per share.
Anyone else's calculator get that, or have I just got a localised warp in reality?
" -- Increases to Net Present Value (discounted at 10% ("NPV-10")) after tax, per share values to US$0.90/share (CAD$1.23/share), US$1.75/share (CAD$2.29/share), and US$2.86/share (CAD$3.47/share) for 1P, 2P, and 3P categories, respectively; "
Thought this worth passing on:
https://www.reddit.com/r/PantheonResourcesPANR/comments/10pzvf3/discord_post_by_fugalvoice/
For those new to PANR this detailed writeup is certainly well worth a read.
And, indeed, though it’s now a few months old - for those who may currently be questioning the integrity of management, there’s even a section where the author covers ‘Management Credibility’.
Also, there is coverage, briefly, of the history of Pantheon in Texas and of the Great Bear Merger.
There’s even a tasty analogy of the Macro-Permeability question and lots, lots more.
And it finishes, aptly, with a ‘Chances of Success and Valuation’ section, basing some numbers on the success / failure at Alkaid#2.
A informative and a very readable piece by Telemachus - viewable on Reddit:
https://www.reddit.com/r/PantheonResourcesPANR/comments/v26f6s/an_independent_view_of_pantheons_alaskan_assets/?utm_source=share&utm_medium=ios_app&utm_name=iossmf
Something to focus on from Bob Rosenthal, on the Jan 2023 Webinar
“What Michael’s demonstrated is that, even given the product streams that we have today – the gas - natural gas, condensate and oil – the stream that we have today – that we can model that as commercial.
We can handle the gas, that we’re producing.
We can handle the water, that we’re producing.
And we know – and we know, or we believe, that by moving our well positions in - in the Alkaid field, that we can actually change the product stream and things can even get better.
I think those are really, really important messages that everybody – you know – takes away from this.
And - really focus on that.”
https://www.youtube.com/watch?v=XWCLbBliIfw#t=38m20s
at about time: 38mins 20secs in.
Bob Rosenthal has over 40 years' experience in the oil and gas industry globally as an Exploration Geologist and Geophysicist. He has held various senior exploraiton positions and spent a large part of his career at Exxon and at BP, where he gained key releveant regional experience in the geology of North Slope of Alaska …
- source Pantheon resources website.
https://twitter.com/PantheonResour1/status/1618612662102794242
~ 29m 40s, on the January Webinar, where he speaks of possible future Alkaid well trajectories, locating them in the reservoir so as not to contact the gas cap. And simply by doing this, raising the exciting possibility, that without the large movement that is currently gas from the gas cap - that gas flow from the reservoir into the well bore might well be replaced by the flow of a significant amount of oil.
Michael Duncan talking about the Alkaid#2 gas flow:
“… about 2 and a 1/2 to 3 million cubic feet a day of natural gas….
… in reservoir conditions, that gas, takes up approximately 1,500 barrels….
…its very exciting to think of the possibilities, as we move out of contact with that gas, and instead, the fluid moving through the system is oil.”
https://www.youtube.com/watch?v=XWCLbBliIfw#t=29m35s