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Pantheon Resources – The Best In A Bad Market

Pantheon resources – By CamKite

EPIC: PANR

Pantheon Resources, reaching total depth in less than 3 weeks seems to have gone

completely un-noticed by most investors and avid oil heads alike.. With its principal assets, 50% working interest in four projects in Tyler and Polk Counties, East Texas.

 

Pantheon are in the process of drilling the first of 2 wells, which, with a 50% COS, c$15 extraction costs if proven successful will offer considerable upside for investors.

 

CEO Jay Cheatham, industry veteran, describes the acreage as “one of the most exciting prospects I have been involved in during my industry career”

 

The company have spent the last 3 years working towards these drills so this is no wild cat drill. From a personal perspective, PANR reminds me of Roxi Petroleum before the oil find when it was trading around the 3p mark and just like Roxi, completely un-noticed by the market.

 

There is very good reason and evidence to believe that this company will strike oil on their acreage, with a 50% stake in the P50 300mmbo it may be worth investors and % hunters, taking a deeper look.

 

Following the completion of an extensive three year geological study undertaken with the Bureau of Economic Geology at the University of Texas, Austin, it is believed that this target is geologically analogous to the Double A Wells field for the Eagleford / Woodbine sandstone.  Which is the producing formation of the Giant East Texas oil field that has produced over 5 billion barrels of oil to date.. The company believe that this play has been de-risked by neighbouring wells, which have enjoyed a 93% success rate over recent years.

 

The first of two wells was spud on the 27th July, this well has as a secondary target, the shallower Austin Chalk formation, which was drilled from a nearby location in 2009 and flowed natural gas, condensate and black oil before being plugged and abandoned for mechanical reasons. The Primary targets on both of these drills will be targeting the Woodbine / Eagleford sandstone regions.

 

Pantheon Resources listed on AIM since 2006.  In October 2014 the company completed a $30 million placing at 20 pence to double its interest in its first project from 25% to 50% and also to acquire in addition, a 50% interest in three other subject areas identified by an extensive three-year geological study. This funding will also be used to fund the 2015 drill program.

 

If the first two wells confirm their current understanding of the Woodbine / Eagleford sandstone and the presence of sufficient hydrocarbons, it could open the way to development of up to 300 million barrels of oil.

 

As Jay stated in a recent interview with Malcolm Graham-Wood, the current operating costs of the licence is less than $1 per BOE, $3 Capex and $1 Opex. With these kinds of figures it is easy to see that if Pantheon prove successful in their drilling, it offers potentially big gains for investors. “The metrics are incredible” … “a 50% or even greater than 50% COS” … “We have the potential to create Billions of $ of value for Pantheon” … The current Market cap is a little over £33m, the SP trading below the last funding round and less than 20% above the 12 month low

 

In a declining Oil market with prices at yearly and thrice yearly lows it is of course wise to take this into consideration when choosing which oily to put your hard earned into.. To ease the investors nerves, the company has stated that they believe “if” they can prove that the oil is there with minimal drills then they can get 85-90% of the present value from the field through a sale and with the costs as low as they potentially could be this appears to be a diamond in the rough!

 

Please bear in mind that this is an oil drill… there are no guarantees. There is a wealth of information available on the internet for those who are keen to seek it. I recommend taking a much deeper look into Pantheon and possibly taking a position before the results are due to be announced end of September.

Best of luck, see you at the river!

(For the avoidance of doubt the author holds stock in the company named) 

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