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Hi all genuine 88E LTHs. I have a 100% genuine, factual, information-seeking question. I fully appreciate that cash outflows for Q2 will be markedly less than for Q1. However, and as noted in the answer contained in section 8.8.1:

"8.2 relates to costs with the Merlin 2 well which are fully covered by existing cash reserves. The Merlin 2 well expenditure will reduce in the second quarter with drilling operations, plugging of the well and demobilisation of equipment and people concluding in April 2022."

there looks like there will be some residual payments to be made for the back end of operations at Merlin-2. Is anyone aware of guidance from the company as to the approx cash outflow in Q2 which will finalise all invoices and accounts payable associated with Merlin-2?

I appreciate 88E has notified shareholders it had A$32.6 in cash (no debt) at period end, equivalent to c.US$24m. I'm enquiring how much of that cash is earmarked to finalise the payments due for the Merlin-2 operation.

Can anyone assist please? Thanks in anticipation.

07:51
Hi slartybartfast - fair question. The strong regulatory structure enforced on exploration activities in the North Slope of Alaska means that flow tests of vertical test wells are limited in duration. My reading suggests an average duration of 3 days, give or take, for flow tests after perf and stimulation has occurred.

In that sense, PANR's flow tests of the BFF Lower and the SFS at Talitha #A looked, to my eyes, to be utterly standard, "run of the mill" type flow tests. Duration and data collection looked to be standard practice.

The adverse weather events meant that the flow test of the SMD at Talitha couldn't be completed this season. The BFF Lower flow test at Theta West was also affected by the bad weather and the duration of the flow test cut short v's the plan. However, in the case of the BFF Lower test at Theta West, *sufficient data was collected* for management to formally assert the BFF Lower reservoir is commercial. Last night's presentation walked shareholders through the mathematical modelling and precedents which management and external independent parties have used to support the assertion of commerciality. So, in this case, although the *duration* of the Flow test of the BFF Lower at Theta West was certainly shorter than planned, the data collected met and surpassed the threshold required to declare commerciality.

I understand the basis for your question. There are occasions investing in small caps when, by necessity, you have to outsource the expertise required and place your faith in management. For me, PANR/GB management have earned my trust. Whether they are proven 100% correct or 100% wrong, there is no doubt whatsoever in my mind that the guidance we heard last night represents the genuine professional opinion of the individuals leading the company.

That leaves me very comfortable with my investment. In fact I added to my holding late yesterday afternoon. Certainly some may prefer to wait until the conclusion of the Long Term Production Test at Alkaid-2. In so doing, such investors will, IMO, have to pay a far, far higher price for PANR's equity. It is my contention that management has relayed sufficient hard data and guidance to allow investors to make a risk-adjusted decision, using industry accepted metrics. The final choice does lie with each individual shareholder, and rightly so. Trust that helps.

Hi Troughsnout,

1) I read your Brevarthan stuff plus content on lse. Hmmmm, I can fairly comfortably follow your narrative on the stocks you cover but, speaking plainly, PANR is nothing like any of them, is it? You're at ease when modelling cashflows but display, at least to my eye, no professional expertise in reservoir engineering or petrophysics, in fact anything pre-revenue. Correct?

2) You have conducted only the most superficial of exercises as it pertains to researching the PANR investment case. The reason I can be pretty confident in that observation is that I recognise some of your vapid blather because it was the sort of facile drivel I, myself, came out with when asked my opinion by the buyside on a stock outside my ken.

3) Thus far, you appear to be completely uninterested in a wholesome and honest discussion with posters who have attempted to engage, and in Rabito79's case, directly rebut (with sources), your erroneous and clearly made up claims. To the objective observer, you have absolutely no intention of acting in good faith. Quite the opposite in fact. How so? To besmirch the characters of a management team whom you do not know on a personal basis is both lazy and completely unjustified. No proof, no references, no quotations, no testimonials.....nothing but made up and fairly child-like snide barbs. All pretty lazy stuff.

4) If you're not already, I strongly urge you to go short on this name. I am pretty sure, all things being equal, you will get carted out. Knock yourself out.

5) I'll add to Rabito79's excellent rebuttal. I'll tell you just how far back and comprehensive PANR's data is, shall I? PANR/GB possess the ***cores*** taken at Pipeline State No.1. You, Troughsnout, are a charlatan, and a lazy one at that. Nevertheless I'll make this offer to you. You go back and read all the RNSs since Jan '19, listen to all the webinars since the same date, read all the GB/PANR submissions to the DNR (and their replies) and if, once you've done so, you wish to engage with me, I give you my word I will do so.

6) If it's alright with you, rather than follow blindly the words of an anonymous avatar on a bulletin board, I'm going to go with Roger Young (discovered the 1.2bbo [reserves] Alpine field on the ANS, >600mmbo produced thus far) of eSeis, Mike Smith of AHS Baker Hughes who designed every single Volatiles process (and attendant equipment) operating in the sector today and Lee Keeling (Halliburton's recommendation of IER to GB).

Don't forget to increase your short! Pip, pip!

Please find below first reaction from WH Ireland, dated 16/5/22.

"Pantheon Resources (PANR) – Corporate – Rig Contracted to Drill Alkaid #2

Market Cap £983.9m Share Price 130p

Pantheon Resources announced that it has contracted a rig (the Nabors 105AC) to the Alkaid #2 well, which the company indicated is scheduled to spud in July 2022. The company indicated that if the well is successful, Pantheon Resources will commence a long-term production test and truck and sell the produced oil to a nearby North Slope facility.

The company indicated the objectives of the well include (from shallowest to deepest) i) to appraise the shallower Shelf Margin Deltaic horizon (which management estimates contains 404 million barrels of contingent resources) ii) to commence a long-term production test of the primary objective Alkaid horizon (which independent expert Lee Keeling & Associates contains 76.5 million barrels of contingent resources), and iii) to evaluate the extent of the oil column within the Alkaid horizon immediately below the total depth of Alkaid #1 (as a reminder, drilling was stopped at the Alkaid #1 due to a surface event).

The company indicated that it will be hosting an investor presentation on Modelling Horizontal Well Performance today (Monday 16 May) at 5:00 pm BST (a recording of which will be made available on the company’s website).

WHI View:
Pantheon’s operational success has greatly exceeded our expectations in 2022, sometimes in surprising ways. In contrast, we actually expect the first news from the
Alkaid well to provide significantly positive newsflow. This is because drilling deeper below the depths of the Alkaid #1 will almost certainly, in our opinion, result in a resource upgrade relative to the estimate of 76.5 million barrels of recoverable 2C resource as determined by Lee Keeling & Associates.

Big picture, the macro backdrop for oil remains extremely robust. The ease with with Alkaid #2 is expected to be brought onstream highlights the extraordinary advantage of the location of Pantheon Resource’s assets relative to the key infrastructure in Alaska, namely, the Dalton Highway and the Trans Alaska Pipeline System. All in, we expect Pantheon’s exceptionally positive momentum to be maintained through the drilling and testing
of the Alkaid #2 well."

Thu 09:16
Hi theiceberg - nice post. Just a simple fyi - the 3D seismic was shot pre-merger so that was a GB decision. Hope that helps? Like you and I have done, it's starting to *feel* that more people are realising the once stark division between conventional and unconventional reservoirs is no longer applicable thanks to improved engineering techniques, eg. long lateral wells, multi-stage fracks, incredibly accurate directional drilling, 3D seismic, offset analysis, VAS, etc. I agree with all of your other suggestions/conclusions. As cbaron notes, the howls of outrage from the eponymous 88E Army as they are faced (potentially) with a year or two of non-drilling activity will be ear-splitting. All the short term traders will depart, safe in the knowledge they can buy back in later. Let's see what the supposed farm out negotiations reveal.

Thu 11:03
Spot on, FORD707.

Fri 13:13
GS - I'll take no lesson on conduct from a poster who a) insisted on filling this forum for months on end with baseless conspiracy theories about mutant hedge funds from outer space or some such b) didn't know the meaning of hedging within a financial context c) admits to drunk posting on more than one occasion d) posts content full of filth, drunk or sober e) elected not to accept my profound, sustained and well-meaning warnings about 88E, relating to both geological and corporate governance concerns.

Naturally GS is free to follow the content and logic/rationale/interpretation I elect to share with the forum, or not. To other readers, I have associates with whom I invest who collectively speak for a decent tranche of the shares on issue. In their number are experienced O&G professionals. Working with my fellow investors on the comparative analysis of PANR and 88E has proven to accurate so far. Totally up to readers whether they think that was luck or due to hundreds of hours of research.

Sat 15:58
Incorrect. I gave GS repeated "off ramps" by providing fact-based rebuttals for his numerous conspiracy theories. That he chose not to take those off ramps was his decision. Thereafter, for fear he was intentionally misinforming other investors or potential investors I proceeded to dismantle his gibberish. As I have stated on numerous occasions, if GS stops posting nonsense, there'd be no need whatsoever to rebut his g0bbledyg00k. Notably, I have never sworn or used foul language in relation to GS, discussed if he's lonely or not, discussed his friendship circle, etc. Up to readers who they choose to believe.

GS states, " I think I have a pretty good grasp of how things work..." I strongly disagree and see no reason to amend my opinion.

Sat 19:08
Hi Blingybird - I'm not convinced you have the correct well definitions? Exploration, Appraisal and Production? Bob Rosenthal is on record stating he has drilled his final exploration well. PANR's wells over the last two winter seasons have been appraisal wells. Alkaid-2H will be the first production well.

14:10
cbaron - ""that of the combined Alkaid + Talitha + Icewine East + Theta West asset"
Well, at least the asset is growing and therefore so must the net value of each company's share."
Nope, whenever discussing the ownership ratio of oil by value the above projects have always been the "100" from which I then apportion value to each company. Thus, in my calculations and model, the figures I'm using have not changed. Once again, I have no idea what you're going on about.

I'll attempt to direct you to the apportionment calculation and the assumptions behind it. Have a listen to the April '21 webinar again. Work out how outsized the BFF is v's all the other horizons. Combine that with the leases PANR picked up in the SoA November lease auction, leases which, let us not forget, were given up by 88E. And many of the self-styled 88E Army on Twitter continue to argue 88E management has an equal understanding and equal amount of data as that of PANR? Extrapolating beyond current lease boundaries? No. Assume added resource underneath Alkaid Deep? No. [scot126 - although I do expect an added resource to be identified underneath Alkaid Deep this summer by Alkaid-2H.]

14:57
GS - I have absolutely no idea what you're going on about with your gibberish scenario of 3700ft reducing to 185ft or some such. I have no idea how to even begin answering that. Yes, depth will certainly be a factor when calculating TRR but you do accept that areally the reservoirs are located chiefly on PANR acreage, don't you? I'm almost scared to ask that question as I'm genuinely fearful how you might reply, lol.

Noted and withdrawn ref. 88E drilling on PANR's acreage. Same answer, more or less. 88E would be welcome to do whatever they wish on their own acreage, and quite right too. I'm sure PANR management would be happy to read the resulting RNS on the completion of any such drill. How are 88E going to finance such a drill, GS?

It's obvious GS doesn't "get" the whole split of the asset by value thing. Need to make it simpler. GS - imagine a pizza with ten equally sized slices. I contend PANR owns 9 of those slices and 88E owns 1 slice.

Just imagine looking down on the stacked reservoirs from a satellite above the North Slope. I'm contending that if you could peer 2 miles subsurface you'd see a random looking puddle shape. One lobe of that puddle is approx 10% of the puddle. Draw an imaginary line separating that lobe from the rest of the puddle. That's the boundary line. Can you picture it now?

15:01 Aye, it's a question alright. Makes me question, etc, etc. Anyhoo, see answer above.

20:56
cbaron-"feeble", "pacify". Sounds like you're still smarting from the dissection of your posts of last week where it was proven it was *your* expectations which led you to be disappointed in PANR winter season. You must be scratching your head in puzzlement at the SP appreciation, lol? Anyhoo, dry your eyes, stop behaving like a teenage girl and get back to the fun

15:30
Hi neil9327 - your Pikka value per contingent barrel in the ground v's PANR's is a fair question. I don't know whether it is you who is asking the same question on multiple platforms or whether others are copy'n'pasting your original post (was it on reddit?). Looks like you've personally posted it on reddit and lse at a minimum?

I have a couple of questions for you. Why have you not incorporated Telemachus' historical content on reddit to your repeated and unedited questions? If it helps you, I know Telemachus and without any hesitation or question, I would describe him as a world class O&G man with the CV and pedigree to match that description.

Also on reddit, other helpful posters have generously pointed you in the right direction to answer your questions. Let me give you the most obvious of examples which also jumped out to at least one responder to the original post. You (presuming you're the original author?) didn't understand or refuse to incorporate the massive, massive US$3bn+ of capex required to produce first commercial oil at Pikka v's PANR's acreage. If Alkaid-2H is a success, PANR will be a) producing first commercial oil in 2022, a full 4 or 5 years ahead of first oil at Pikka (and maybe longer) b) PANR's capex will be an order of magnitude less than STO/Repsol's to deliver first oil and c) PANR's model sees a phased or iterative approach to full field development v's massive up front capex to be used to construct essential infrastructure....all of which sees the comparative NPV calculation move massively in PANR's favour v's that of Pikka.

No-one is saying for one moment that flow rates from a vertical test well on PANR acreage is going to compare with the 2000-3000 bopd figure from at least one of the Armstrong wells. I'm just checking....you do know Armstrong drilled 12 wells and 7 laterals?

As for your geological questions, the Nanashuk is similar to PANR's Brookian/Campanian geology but there are depositional differences between the two locations. Have a look at the Tarn oilfield. The drilling on PANR's acreage will resemble that required to produce at Tarn v's Pikka.

Constructive idea for you, Neil? Draw up a list of questions and email them to the company directly, see the RNS confirming the webinar for the details. PANR will likely be addressing some/many of your concerns in the webinar but in the meantime, be assured PANR management knows fine well all the data from Pikka/Horseshoe and has examined Santos' development model. There are no surprises here. PANR's model can stand on its own two feet. It's a question of how far up the derisking curve you're prepared to accept rather than fearing the company has "missed" something in its awareness of North Slope project economics,

Mon 09:32 & 08:32 & Sun 21:15

theiceberg/Mindbender/cringsing - yep, there's some different ways these situations can play out. In the UK, the vast majority of approaches are confidential at Board level. If the target BoD deems the approach ridiculous or outlandishly opportunistic they can send the potential acquiror away with a flea in their ear and nobody ever finds out about the approach.

If the target BoD think the approach is worth exploring, they might have in/formal discussions and see if a rationale develops such that they can see a path to the approach being in shareholders' interests.

The UK regulators and the structure of UK law means that parties are gently "encouraged" to move towards a situation whereby an approach is recommended by the boards of both the acquiror and target companies. If news of the approach is leaked (deliberately or not) then the regulator steps in and a more formal timetable is enforced whereby the acquiror(s) are obliged to make a formal bid by x date otherwise their approach is deemed to have failed and they have to walk away from the target company for a period determined by the regulator/law (6 months).

Very, very occasionally the acquiror will go hostile and blast out news of the approach to the whole market. Rarely happens in the UK but it's far more "normal" in other jurisdictions, such as Australia for example.

Anyhoo, let's look at PANR's history for clues. I think it's fair to say the market didn't hear even a whisper about the PANR/GB merger despite the fact we were informed subsequently the parties were in discussions for 6 months prior to the RNS in mid December '18. This fact together with general observations over many years suggests to me that the PANR BoD is perfectly capable of handling and dealing with confidential negotiations.

Further evidence comes in the second half of 2021. Shareholders were informed over what, a 4 or 5 month period that farm out discussions were underway. We shareholders weren't told anything more than that. Of course we now know that a deal was agreed in principle but that the potential farm in party played about with terms at the last minute. [Ha! Bet they're kicking themselves now!] Just imagine if the PANR BoD had elected to provide us shareholders with "running commentary" style RNSs from July to November '21, providing guidance on financial terms, etc, etc? The market would have seen the SP fluctuate dramatically as expectations built up only to be dashed, blah, blah, blah.

My view? I think we PANR shareholders are fortunate our BoD are extremely experienced in these matters. Both Jay and Bob have spent decades in the sector and each has been on both sides of the table, ie. working for major companies who are looking to acquire assets/companies and also have worked for companies which themselves were the subject of approaches for assets or for the entire company. Me? I'm perfectly comfortable trusting our BoD to advance the interests of PANR

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