Last checked at 27 May 2008 11:43
| Press release | 27 May 2008 |
Pantheon Resources plc - Participation in East Texas Chalk Formation and Placing of up to £4.54 million
Pantheon Resources plc (the "Company" or "Pantheon"), the AIM-listed oil and gas exploration company active in the Gulf of Mexico, is pleased to announce its participation in a new venture in East Texas. The company has secured a 25% participation in a 25,000 acre Austin Chalk and Woodbine formation play located in the Brookeland Field in Tyler County, Texas.
Details of Tyler County Venture
Pantheon's partners in the Tyler County Venture are Vision Resources LLC ("Vision"), Kaiser-Francis Oil Company ("Kaiser-Francis") and Noram Resources Inc ("Noram"). Vision and Kaiser-Francis have a combined interest of 62.5% in the venture with Noram holding 12.5%. Vision has spent three years building the acreage position and will act as operator. This acreage is located immediately south of Anadarko Petroleum Corporation's and Ergon Oil and Gas's successful drilling, also in Tyler County.
Pantheon will pay its share of Vision's back costs (US$7million net to Pantheon) over the first three wells and receive 150% equivalent Net Revenue Interest ("NRI") until payout. After three wells Pantheon will have been deemed to have earned its full 25% interest in the 25,000 acre block. Thereafter the company will pay only its pro-rata share of any future development and drilling costs. Agreements and infrastructure are in place for marketing any crude oil and natural gas that may be discovered and produced.
The Austin chalk wells are completed horizontally and approximately 50% of all production is usually generated in the first year. Drilling on Pantheon's acreage is currently scheduled to commence in June 2008. It is expected that wells should take 75 days to drill on average, including both vertical and horizontal sections.
Details of Placing
Pantheon also announce today that the Company has received commitments from various institutional and other investors to raise up to £4.54 million by way of a placing of up to 22,681,452 ordinary fully paid up shares (the "Placing Shares") in the Company at a price of 20p per Placing Share (the "Placing"). These new ordinary shares shall rank pari passu with the existing shares in the Company. The capital raised will be used to fund the Tyler County drilling, as well as for the provision of general working capital. This placing was oversubscribed.
As the number of shares being issued as part of the Placing exceeds the Company's current S80 authority the Board will seek shareholder approval to allot 5,629,123 additional shares required to complete the placing and re-establish the same level of S80 authority that was in effect before the Placing.
In order to fund the participation in the East Texas chalk formation 17,052,329 shares will be placed immediately raising £3.41 million, before expenses, taking advantage of the current S80 authority. It is expected that these shares will be admitted to trading on AIM on 2 June 2008. The remaining 5,629,123 shares will be placed conditional on shareholder approval extending the S80 authority as described above. In order to action this approval a circular has been sent to shareholders today convening an EGM on 23 June 2008.
Jay Cheatham CEO of Pantheon stated "I couldn't be more pleased with the two announcements today. The Austin Chalk is a producing horizon I personally know very well. My family has been involved in the Austin Chalk for 50 years. During my time as the head of Arco's Gulf Coast E&P, that company drilled some of the earliest horizontal wells in the Brookeland Field almost 20 years ago. As the technology has improved so have the well rates, recoveries and economics. Recently some of the offset wells drilled by Ergon have been exceptional with very rapid payback. I am especially pleased to be working with Vision which has performed an outstanding job both technically and building the acreage position.
I am also pleased with the response we had from our private placing. Some significant and important new shareholders have been added to the Pantheon
base."
For further information on Pantheon Resources plc, see the website at www.pantheonresources.com
- end -
Further information:
Pantheon Resources PLC
| Jay Cheatham, CEO | +44 20 7484 5359 |
Oriel Securities Limited
| Scott Richardson Brown | +44 20 7710 7600 |
Luke Webster
Notes to editors:
Pantheon Resources plc
Pantheon Resources plc was formed in 2005 to be an independent gas exploration company focused on hydrocarbon producing basins onshore or near shore the Gulf of Mexico. On 5 April 2006, Pantheon was admitted to the AIM, having successfully raised £10m from a mix of quality institutional and private investors.