REG - Pantheon Resources - Interim Results for Six Months Ended 31/12/21
31/03/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220331:nRSe6849Ga&default-theme=true
RNS Number : 6849G Pantheon Resources PLC 31 March 2022
31(st) March 2022
Pantheon Resources plc
Interim Results (unaudited) for the six months ended 31 December 2021
Pantheon Resources plc ("Pantheon" or "the Company"), the AIM-quoted oil and
gas exploration and production company with 100% working interests in several
conventional projects on the North Slope of Alaska, announces its interim
results for the six months ended 31 December 2021 (the "Period"), together
with operational highlights for the half year and the period beyond.
HIGHLIGHTS
Operational
· Completed a fundraising raising of $96 million, comprising US$41
million in equity and $55 million in unsecured Convertible Bonds before
expenses
· Drilling of Theta West #1 well in January 2022; successfully drilled
to target depth. Flow testing achieved pre-drill objectives, confirming the
presence of high quality, light oil, and the movability of that oil
· Testing of Talitha #A well - Flow testing achieved pre-drill
objectives, confirming the presence of high quality, light oil and the
movability of that oil in each of the targeted horizons:
(1) Basin Floor Fan;
(2) Slope Fan System; and
(3) Shelf Margin Deltaic
· Webinar planned for late April
Financial
· Loss for the period $4.4 million (2020: $3.0 million). Includes a
non-cash accounting charges of $0.8 million (2020: nil) relating to the
Convertible Bond and $2.0 million (2020: $1.6 million) relating to the
issuance of share options
· Strong cash position:
o Cash on hand 31 December 2021: $92.7 million (2020: $29.8 million)
o Cash on hand 30 March 2022: $72 million
· Convertible Bond principal outstanding 30 March 2022, $50.35 million
Jay Cheatham, CEO of Pantheon Resources, said:
"The period to 31 December 2021 and beyond has been one of great achievement
for our Company. Against a backdrop of strong oil prices and geopolitical
turbulence, there never has been a better time to prove up what has the
potential to be a nationally significant oil resource in a safe jurisdiction
onshore USA.
"Our drilling and testing has yielded results we are incredibly proud of. We
completed our activities with a perfect health and safety record, and despite
weather and service provider issues, we expect to come in within 10% of
budgets.
"We achieved what we set out to do - namely to confirm the presence and
movability of oil in our targeted horizons. Production wells on the North
Slope will all be drilled with long lateral sections and stimulated, quite
different to the vertical test well drilled to gather data and then plugged
and abandoned. The arrival of severe storms halted our operations which means
that we made the decision to conclude operations for the season due to the
lack of certainty surrounding whether we would have sufficient time before the
onset of Spring weather. Notwithstanding, we have sufficient data to be
satisfied that both Talitha #A and Theta West #1 are significant discovery
wells. I look forward to sharing our learning with shareholders in our late
April Webinar."
Further information:
Pantheon Resources plc +44 20 7484 5361
Jay Cheatham, CEO
Justin Hondris, Director, Finance and Corporate Development
Canaccord Genuity plc (Nominated Adviser and broker)
Henry Fitzgerald-O'Connor, James Asensio, Gordon Hamilton +44 20 7523 8000
BlytheRay
Tim Blythe, Megan Ray, Alice McLaren, Madeleine Gordon-Foxwell +44 20 7138 3204
Notes to Editors
Pantheon Resources plc is an AIM listed Oil & Gas company focused on
several large projects located on the North Slope of Alaska ("ANS"),
onshore USA where it has a 100% working interest in 153,000 highly
prospective acres with potential for multi billion barrels of oil recoverable.
A major differentiator to other ANS projects is its close proximity to
transport and pipeline infrastructure which offers a significant competitive
advantage to Pantheon, allowing for materially lower capital costs and much
quicker development times. The Group's stated objective is to create material
value for its stakeholders through oil exploration, appraisal and development
activities in high impact, highly prospective conventional assets, in
the USA; a highly established region for energy production with
infrastructure, skilled personnel and low sovereign risk. All operations are
onshore USA, with drilling costs materially below that of offshore wells.
For further information on Pantheon Resources plc, see the website
at: www.pantheonresources.com (http://www.pantheonresources.com/)
STATEMENT FOR THE SIX MONTHS ENDED 31 DECEMBER 2021
__________________________________________________________________________________
Pantheon has made significant advancement across its entire petroleum
portfolio for the half year ended 31 December 2021 and into 2022. The improved
macro environment for energy in 2021/2022 and the more recent geopolitical
events in Russia/Ukraine have again reminded the world of the importance of
securing reliable energy sources, such as oil, in safe, stable jurisdictions.
Pantheon entered 2022 in a strong technical and financial position, enabling
the continuation of its projects in Alaska, where it is currently involved in
the largest operating campaign in its corporate history. Through its
high-impact projects on the North Slope, Pantheon seeks to transition from a
pure exploration company to an oil development and production company.
There have been several significant achievements since 1 July 2021, as
outlined below:
Completion of $96 million fundraising
In December 2021, Pantheon completed its largest ever capital raise, securing
$96 million through a combination of US$41 million equity and US$55 million
convertible debt which allowed the Company to move forward and execute its
proposed 2022 work programme.
The programme includes:
(i) the drilling of a vertical test well on the Theta West
project;
(ii) testing of a well on the Talitha project; and
(iii) the drilling of a well on the Alkaid project, planned for
mid-2022.
Collectively, the Company estimates these three 100% owned projects have the
potential to contain 17 billion barrels of oil in place ("OIP") and over 2.2
billion barrels of recoverable resource. The Directors believe this to be one
of the most impactful oil operations in the world this year.
As stated above, Pantheon intends to drill the Alkaid #2H horizontal
development well adjacent to the Dalton Highway and Trans Alaska Pipeline
System in mid-2022. If successful, the Alkaid #2H well will become the first
oil producer for Pantheon on the Alaska North Slope, representing a
significant milestone for the Company, generating valuable production
cashflows.
Spudding of Theta West #A well Post Period End
The Theta West #1 well was spudded in January 2022 and drilled through both
the Upper Basin Floor Fan ("UBFF") and Lower Basin Floor Fan ("LBFF") target
horizons, encountering approximately 1,160 gross feet of hydrocarbon bearing
reservoir across both horizons. Theta West #1 is some 1,500 feet structurally
higher (updip) from the Talitha #A well, 10.5 miles to the southeast.
Shortly into testing and before the well had 'cleaned up', Theta West #1 was
suspended due to the arrival of a major storm, as is standard practise in the
Arctic during severe weather conditions, halting operations, transportation
and resupply to the camp. Prior to the well being shut-in, it well flowed high
quality 35.5 to 38.5 API gravity light oil at rates that averaged 57 barrels
of oil per day ("BOPD") with peak rates exceeding 100 BOPD over the test
period. On the final day prior to shut-in, flow rates averaged 59 BOPD. At
that time only circa 40% of the stimulation fluid was recovered, significantly
less than usually needed to assess the ultimate flow rate potential.
Notwithstanding, the Company was greatly encouraged by the results, achieving
the well's primary objectives of (i) confirming the presence of high quality,
light oil and (ii) confirming the movability of that oil.
Importantly, the samples analysed to date by AHS/Baker Hughes, contracted to
undertake Volatiles Analysis Service ("VAS") work, confirmed the presence of
light oil within the UBFF and the LBFF, consistent with the Logging While
Drilling and flow test data.
Theta West is a giant basin floor fan (BFF) system and is now confirmed to
span more than the 10.5 miles from Talitha #A to Theta West #1. The Company
estimated a pre-drill resource of 12.1 billion barrels of oil in
place ("OIP") and a P50 Contingent Resource (Recoverable) of 1.41 billion
barrels of oil at Theta West. This estimate will be reviewed and updated in
due course after a more detailed evaluation.
At the time of writing the well remains shut-in, with 31 people on location
awaiting a sufficient weather break with the objective of resuming operations
in order to maximise data gathering prior to plugging and abandoning the well
at the end of the season. However, given the length of time to reposition
additional personnel for testing, resupply the camp, dig out and re-certify
all the equipment buried by the storm, the Company is not confident weather
conditions will allow sufficient time to allow for a thorough testing
operation and to allow for plugging and abandonment the well and packing up
the camp prior to the onset of Spring weather. Accordingly, the Company
believes it prudent to commence demobilizing the equipment and camp and to
plug and abandon the well. The Company estimates it would require up to three
weeks of good weather to undertake satisfactory testing (and packup of
operations) in accordance with best practise engineering, environmental,
health and safety guidelines, and is not confident this is possible prior to
the onset of Spring.
Notwithstanding, the Company has collected sufficient data during the
programme to confirm its pre-drill estimates of reservoir quality and the
presence of light, moveable oil in the Basin Floor Fan.
Theta West represents a major success for Pantheon and a major opportunity for
Pantheon to pursue the appraisal and potential development of what the Company
considers a truly world class project in an excellent location.
Pantheon plans to re-enter Talitha #A next season to test the Shelf Margin
Deltaic zone and to drill another appraisal well at its Theta West BFF
discovery.
Testing of Talitha oil zones Post Period End
The Talitha #A vertical test well was drilled in 2021 penetrating several oil
zones which included the Shelf Margin Deltaic sequence, the Slope Fan System,
the Basin Floor Fan, as well as the deeper and independent Kuparuk formation.
Due to weather related time constraints, the Kuparuk formation was the only
zone tested in 2021. Therefore, testing of all other zones at Talitha #A
became a subject of the 2022 season. The primary objective of testing of the
shallower zones was to determine (i) the quality of oil; and (ii) the
moveability of this oil through the formation. In contrast to vertical test
wells, future development wells will be drilled horizontally and stimulated
with multiple stage fracs, meaning that flow rates are expected to be many
times higher than the flow rates in vertical test wells.
Lower Basin Floor Fan
The first test was conducted on the Lower Basin Floor Fan ("LBFF"). Three
intervals were individually stimulated and flow tested, producing high quality
c. 35 to 39 degree API oil and averaging BOPD over a three day test period. On
the final day of testing the well was flowing at a sustained rate of
approximately 40 BOPD. Encouragingly, the bottom hole pressure is near to
the reservoir pressure, thus providing an indication of the production
potential of this portion of the oil accumulation, which is at the distal
limits of the field. Management considers this to be a great result for
Pantheon, confirming (i) the presence of oil, (ii) that the oil was high
quality light oil, and (iii) that the oil is movable.
Slope Fan System
Testing operations on the Slope Fan System ("SFS"), which is immediately above
the BFF, involved perforating two intervals within two distinct c. 50 foot
("ft") sand bodies or 'lobes'. The two intervals were stimulated and flow
tested together, producing high quality c. 35 to 38 degree API oil and
averaged 45 BOPD over a three day test period.
On the final day of testing, the well was flowing at a sustained rate of
approximately 32 BOPD from the combined perforations. This is the first
indication of producible oil in the Slope Fan System on Pantheon's acreage and
has significant implications for future resource and recoverable oil
estimates. The two SFS lobes are in two distinct trapping systems with very
good reservoir properties. The Company will provide more information on the
SFS to shareholders in due course, once additional analysis has been
undertaken.
Shelf Margin Deltaic
The final test of the shallowest zone, the Shelf Margin Deltaic ("SMD")
horizon, was suspended due to blockages in the well bore. The well was
perforated in the SMD and was successfully fracture stimulated. Immediately
after the fracture stimulation, the test was suspended due to a blizzard on
the North Slope which shut down all operations for health and safety
reasons. Once flow testing recommenced, the well stopped flowing after a
short period of time. At that time, only 45% of the fracture fluid was
recovered with no formation water and small amounts of light high quality 34
degree API oil. Other than the small amounts of oil, no reservoir fluids were
produced.
The consensus among the Company and external consultants is that there is a
blockage preventing any additional reservoir fluid from entering the well
bore. Based on all the data, which includes a full suite of logs, sidewall
cores, extensive VAS work undertaken by AHS/Baker Hughes over the past 12
months, and the testing of the lower zones this year, the Company's
expectation for the SMD is that it should yield better results than the two
lower zones already tested; the Basin Floor Fan and Slope Fan System horizons,
where the Company has achieved excellent results.
Regardless of the operational challenges, the Company believes the potential
of the SMD is undiminished and it plans further operations on the SMD at
Talitha next season. Additionally, the SMD will be encountered during drilling
of Alkaid #2 mid-2022, where additional information will be gathered. Pantheon
interprets that the SMD extends across the Alkaid project as it extends
southeast across the Dalton Highway. This significantly increases the resource
potential near export infrastructure.
Despite the blockage encountered in the SMD, the Talitha well has been a great
success for the Company, confirming the presence of movable, high quality
light oil in both the Slope Fan System and the Basin Floor Fan, which has very
significant implications for Pantheon's acreage.
The discovery of oil in these formations enhances the prospectivity of other
adjoining potential oil-bearing structures that will form part of a future
drilling programme.
-----------------------
Financial & Corporate
The interim results show a loss for the period of $4.4million ("m") (2020:
$3.0m) which was higher than the previous year largely as a result of a $2.0m
one-off non-cash accounting charge relating to the issuance of share options
and non-cash (interest and 'mark to market') charges of $0.8m relating to the
issuance of the $55 million Convertible Bonds in December 2021.
At 31 December 2021, cash and cash equivalents amounted to $92.7m (2020:
$29.8m). Cash and cash equivalents as 30 March 2022 was $72m.
In December 2021, Pantheon raised approximately $96 million which comprised
$55 million through the issuance of unsecured convertible bonds and $41m in
equity through the placing of 47,637,583 new Ordinary Shares at a price of 65
pence per Ordinary Share, a 110% premium to the previous fundraising price.
Subsequent to year end the Company the principal remaining on the Convertible
Bonds has been reduced from $55 million to $50.35 million.
Other
Overall, the winter 2022 season has been one of tremendous achievement for
Pantheon, with high quality, light oil being confirmed in all targeted
horizons, and the confirmation of what the Company believes to be a material
discovery spanning over 10.5 miles from Talitha #A to Theta West #1. Every
targeted zone confirmed the presence of high quality, light oil and every
targeted horizon confirmed the movability of that oil. Whilst operations were
impacted by weather and operational issues, these do not diminish the
significance of the Group's achievements this winter.
Pantheon intends to host a webinar in late April to discuss in greater detail
the conclusions of what has been a period of great achievement for the
Company. Immediately thereafter the Company will be gearing up for Alkaid #2,
intended to spud in July 2022 adjacent to the Dalton Highway and Trans Alaska
Pipeline System.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2021
___________________________________________________________________________________
Notes 6 months ended 31 December 2021 (unaudited) 6 months ended 31 December 2020 (unaudited) Year ended 30 June 2021
(audited)
$ $ $
Continuing operations
Administration expenses (3,150,888) (2,501,541) (5,034,361)
Share option expense (2,013,966) (1,585,904) (3,211,038)
Interest expense (570,295) - -
Revaluation of derivative liability (200,531) - -
Operating loss (5,945,680) (4,087,445) (8,245,400)
Interest receivable 143 1,000 4,234
Loss before taxation (5,945,537) (4,086,445) (8,241,165)
Taxation 1,497,945 1,124,124 1,573,094
Loss for the period from continuing operations after taxation (4,447,592) (2,962,321) (6,668,071)
Loss for the period from discontinued operations 3 - (54,415) (54,415)
(4,447,592) (3,016,736) (6,722,487)
Loss for the period
Other comprehensive income for the period
Exchange differences from translating foreign operations 844,484 1,100,162 (1,503,199)
Total comprehensive loss for the period (3,603,108) (1,916,574) (5,219,288)
Loss per share from continuing operations:
Basic and diluted Loss per share 2 (0.66)¢ (0.57)¢ (1.17)¢
Loss per share from discontinued operations:
Basic and diluted Loss per share 2 - (0.01)¢ (0.01)¢
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2021
_______________________________________________________________________________________
Share Share Retained Currency Share Non Total
capital premium losses reserve based payment controlling Interests equity
$ $ $ $ $ $ $
Group
At 1 July 2021 9,739,203 208,683,936 (36,331,398) 1,234,562 5,336,462 - 188,662,765
Net loss for the period - - (4,447,592) - - - (4,447,592)
Other comprehensive income: Foreign currency translation - - - 844,484 - - 844,484
Total comprehensive income for the period - - (4,447,592) 844,484 - - (3,603,108)
Capital Raising
Issue of shares 638,462 40,904,076 - - - - 41,542,538
Issue costs - (1,489,248) - - - - (1,489,248)
Exercised options - 230,958 - - (230,958) - -
Share option expense - - - - 2,013,966 - 2,013,966
Exercised share options 40,716 1,099,881 - - - - 1,140,597
Balance at 31 December 2021 10,418,381 249,429,603 (40,778,990) 2,079,046 7,119,470 - 228,267,510
Share Share Retained Currency Share Non Total
capital premium losses reserve based payment controlling Interests equity
$ $ $ $ $ $ $
Group
At 1 July 2020 173,687,092 - 154,542,163
8,568,721 (29,608,911) (268,637) 2,163,898
Net loss for the period - - (3,016,736) - - - (3,016,736)
Other comprehensive income: Foreign currency translation - - - 1,100,162 - - 1,100,162
Total comprehensive income for the period (3,016,736) 1,100,162 - (1,916,574)
- - -
Capital Raising
Issue of shares 973,583 - 30,181,083
29,207,500 - - -
Issue costs - (1,598,850) - - - - (1,598,850)
Share option expense - - - - 1,585,904 - 1,585,904
Balance at 31 December 2020 - 182,793,726
9,542,304 201,295,742 (32,625,647) 831,525 3,749,802
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2021
_______________________________________________________________________________________
Share Share Retained Currency Share Total
capital premium losses reserve based payment equity
$ $ $ $ $ $
Group
At 1 July 2020 8,568,721 173,687,092 (29,608,911) (268,637) 2,163,898 154,542,163
Loss for the year - - (6,722,487) - (6,722,487)
Other comprehensive income: Foreign currency translation - - - 1,503,199 - 1,503,199
Total comprehensive income for the year - - (6,722,487) 1,503,199 - (5,219,288)
Capital Raising
Issue of shares 1,170,482 36,394,313 - - - 37,564,795
Issue costs - (1,397,469) - - - (1,397,469)
Share option expense - - - - 3,172,564 3,172,564
Balance at 30 June 2021 9,739,203 208,683,936 (36,331,398) 1,234,562 5,336,462 188,662,765
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
_______________________________________________________________________________________
Notes 6 months ended 6 months ended Year ended
31 December 31 December 30 June
2021 2020 2021
(unaudited) (unaudited) (audited)
ASSETS $ $ $
Non-Current Assets
Exploration and evaluation assets 4 195,662,187 159,097,101 188,954,719
Developed oil and gas assets 4 - - -
Property, plant & equipment 4 4,245 54,989 30,308
195,666,432 159,152,090 188,985,027
Current Assets
Trade and other receivables 275,315 204,436 109,876
Non-current assets - held for sale - 585,863 -
Cash and cash equivalents 92,667,269 29,766,746 5,663,477
92,942,584 30,557,045 5,773,353
288,609,016 189,709,135
Total assets 194,758,380
LIABILITIES
Current liabilities
1,120,647 1,367,451
Trade and other payables 1,107,090
Provisions 1,250,000 750,000 1,250,000
Non-current liabilities - held for sale - 585,863 -
Lease Liabilities 4,702 52,762 32,788
Deferred tax liability 2,207,792 4,154,706 3,705,737
4,583,141 6,910,782 6,095,615
Non-current liabilities
Lease Liabilities - 4,627 -
Trade and other payables
Convertible Bond - Debt 6 39,734,584 - -
Convertible Bond - Derivative 6 16,023,781 - -
55,758,365 4,627 -
60,341,506 6,915,409 6,095,615
Total liabilities
228,267,510 182,793,726 188,662,765
Net assets
EQUITY
Capital and reserves
Share capital 10,418,381 9,542,304 9,739,203
Share premium 249,429,603 201,295,742 208,683,936
Retained losses (40,778,990) (32,625,647) (36,331,398)
Currency reserve 2,079,046 831,525 1,234,562
Share based payment reserve 7,119,470 3,749,802 5,336,462
Shareholders' equity 228,267,510 182,793,726 188,662,765
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2021
_______________________________________________________________________________________
6 months ended 6 months ended
31 December 31 December Year ended
2021 2020 30 June
(unaudited) (unaudited) 2021
(audited)
$ $ $
Net outflow from operating activities (2,446,588) (989,110) (3,098,495)
Cash flows from investing activities
Interest received 143 1,060 4,295
Interest paid (7,961) - -
Funds used for drilling, exploration and leases (6,707,468) (2,999,493) (24,973,399)
Net cash outflow from investing activities (6,715,286) (2,998,433) (24,969,105)
Cash flows from financing activities
Proceeds from share issues - capital raise 41,000,000 30,181,084 30,181,084
Proceeds from share issues - exercise of options 1,140,595 - -
Issue costs paid in cash (946,710) (1,202,850) (1,197,275)
Convertible Bond 55,000,000 - -
Repayment of borrowing and leasing liabilities (28,218) (26,910) (55,698)
Net cash inflow from financing activities 96,165,667 28,951,324 28,928,111
Increase in cash & cash equivalents 87,003,793 24,963,781 860,511
Cash and cash equivalents at the beginning of the period 5,663,476 4,802,965 4,802,965
Cash and cash equivalents at the end of the period 92,667,269 29,766,746 5,663,476
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2021
_______________________________________________________________________________________
RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING ACTIVITIES
6 months ended 6 months ended Year ended
31 December 31 December 30 June
2021 2020 2021
(unaudited) (unaudited) (audited)
$ $ $
Loss for the period (4,447,592) (3,016,736) (6,722,487)
Net interest received (143) (1,060) (4,295)
Gain on disposal of subsidiary undertaking - - -
Impairment of intangible assets - E&E - - -
Impairment developed oil & gas assets - - -
Impairment of PP&E - - -
Share option expense 2,013,966 1,585,904 3,211,038
Interest Expense 570,295 - -
Derivative mark to market charge 200,531 - -
Depreciation of office equipment - 220 225
Depreciation of right of use assets 25,647 24,600 50,395
Charge on lease - right of use assets - 3,141 6,207
Depletion of developed oil & gas assets - - -
Increase in trade and other receivables (165,439) (130,268) (35,709)
Increase in trade and other payables 13,557 583,359 518,805
Effect of translation differences (fixed assets) - (14) (21)
Effect of translation differences (right of use assets) 1,336 172 179
Effect of translation differences (Share option expense) - - (38,474)
Effect of translation differences 839,199 1,100,162 1,503,199
Taxation (1,497,945) (1,138,590) (1,587,559)
Net cash outflow from operating activities (2,446,588) (989,110) (3,098,495)
NOTES TO THE FINANCIAL INFORMATION
FOR THE PERIOD ENDED 31 DECEMBER 2021
_______________________________________________________________________________________
1. Accounting policies
A summary of the principal accounting policies, all of which have been applied
consistently throughout the period, is set out below.
1.1. Basis of preparation
This financial information has been prepared on a going concern basis using
the historical cost convention and in accordance with the International
Financial Reporting Standards as adopted by the European Union ("EU")
("IFRS"), including IFRS 6 'Exploration for and Evaluation of Mineral
Resources', and in accordance with the provisions of the Companies Act 2006.
This interim report has been prepared on a basis consistent with the Group's
expected accounting policies for the year ending 30 June 2022. These
accounting policies are the same as those set out in the Group's Annual Report
and Financial Statements for the year ended 30 June 2021, which are available
from the registered office or the company's website
(www.pantheonresources.com) (http://www.pantheonresources.com) .
The Group financial information is presented in US Dollars and is unaudited.
The interim financial information does not constitute statutory accounts
within the meaning of section 434 of the Companies Act 2006. The comparative
figures for the year ended 30 June 2021 have been taken from the Group's
statutory accounts for that financial year, which have been reported on by the
Group's auditors and delivered to the Registrar of Companies.
1.2. Basis of consolidation
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control
ceases. The purchase method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an acquisition is
measured as the fair value of the assets given, equity instruments issued, and
liabilities incurred or assumed at the date of exchange. Identifiable assets
acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the acquisition
date, irrespective of the extent of any minority interest. The excess of the
cost of acquisition over the fair value of the Group's share of the
identifiable net assets acquired is recorded as goodwill. Goodwill arising on
acquisitions is capitalised and subject to impairment review, both annually
and when there are indications that the carrying value may not be recoverable.
Inter-company transactions, balances and unrealised gains on transactions
between group companies are eliminated. All the companies over which the
Company has control apply, where appropriate, the same accounting policies as
the Company.
1.3. Foreign currency translation
(i) Functional and presentational currency
The financial statements are presented in US Dollars ("$"), which is the
functional currency of the Company and is the Group's presentation currency.
(ii) Transactions and balances
Transactions in foreign currencies are translated into US dollars at the
average exchange rate for the year. Monetary assets and liabilities
denominated in foreign currencies are translated at the rate of exchange
ruling at the balance sheet date. The resulting exchange gain or loss is dealt
with in the income statement.
The assets, liabilities and the results of the foreign subsidiary undertakings
are translated into US dollars at the rates of exchange ruling at the year
end. Exchange differences resulting from the retranslation of net investments
in subsidiary undertakings are treated as movements on reserves.
NOTES TO THE FINANCIAL INFORMATION
FOR THE PERIOD ENDED 31 DECEMBER 2021
_____________________________________________________________________________________
1.4. Cash and cash equivalents
The company considers all highly liquid investments, with a maturity of 90
days or less to be cash equivalents, carried at the lower of cost or market
value.
1.5. Going concern
The interim report has been prepared on the going concern basis, which
contemplates the continuity of normal business activity and the realisation of
assets and the settlement of liabilities in the normal course of business.
The Directors have reviewed the Group's overall position and outlook and are
of the opinion that the Group is sufficiently well funded to be able to
operate as a going concern for at least the next twelve months from the date
of approval of these financial statements.
1.6. Deferred taxation
Deferred tax is provided in full, using the liability method, on temporary
differences arising between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. Deferred tax is determined using
tax rates (and laws) that have been enacted or substantially enacted by the
balance sheet date and expected to apply when the related deferred tax is
realised, or the deferred liability is settled.
Deferred tax assets are recognised to the extent that it is probable that the
future taxable profit will be available against which the temporary
differences can be utilized.
1.7. Exploration and evaluation costs and developed oil and gas properties
The Group follows the 'successful efforts' method of accounting for
exploration and evaluation costs. At the point of production, all costs
associated with oil, gas and mineral exploration and investments are
classified into and capitalised on a 'cash generating unit' ("CGU") basis, in
accordance with IAS 36. Costs incurred include appropriate technical and
administrative expenses but not general corporate overheads. If an exploration
project is successful, the related expenditures will be transferred to
Developed Oil and Gas Properties and amortised over the estimated life of the
commercial reserves on a 'unit of production' basis.
The recoverability of all exploration and evaluation costs is dependent upon
the discovery of economically recoverable reserves, the ability of the Group
to obtain necessary financing to complete the development of the reserves and
future profitable production or proceeds from the disposition thereof. All
balance sheet carrying values are reviewed for indicators of impairment at
least twice yearly. The prospect acreage is classified into discrete
"prospects" or CGU's. When production commences the accumulated costs for the
specific CGU is transferred from intangible fixed assets to tangible fixed
assets i.e., 'Developed Oil & Gas Properties' or 'Production Facilities
and Equipment', as appropriate. Amounts recorded for these assets represent
historical costs and are not intended to reflect present or future values.
1.8 Impairment of exploration costs and developed oil and gas properties,
depreciation of assets, plug & abandonment and goodwill
In accordance with IFRS 6 'Exploration for and Evaluation of Mineral
Resources' (IFRS 6), exploration and evaluation assets are reviewed for
indicators of impairment. Should indicators of impairment be identified an
impairment test is performed.
In accordance with IAS 36, the Group is required to perform an "impairment
test" on assets when an assessment of specific facts and circumstances
indicate there may be an indication of impairment, specifically to ensure that
the assets are carried at no more than their recoverable amount. Where an
impairment test is required, any impairment loss is measured, presented and
disclosed in accordance with IAS 36.
Exploration and evaluation costs
All exploration and evaluation assets relate to the Group's Alaskan
operations.. The Alaskan leasehold assets were fair valued as at the date of
acquisition of Great Bear and the carrying value at 31 December 2021
represents the cost of acquisition, (plus the fair value adjustment, in
accordance with IFRS) and any capitalised costs incurred subsequent to the
acquisition.
Decommissioning Charges
Decommissioning costs will be incurred by the Group at the end of the
operating life of some of the Group's facilities and properties. The Group
assesses its decommissioning provision at each reporting date. The ultimate
decommissioning costs are uncertain and cost estimates can vary in response to
many factors, including changes to relevant legal requirements, the emergence
of new restoration techniques or experience at other production sites. The
expected timing, extent and amount of expenditure may also change - for
example, in response to changes in reserves or changes in laws and regulations
or their interpretation. Therefore, significant estimates and assumptions are
made in determining the provision for decommissioning. As a result, there
could be significant adjustments to the provisions established which would
affect future financial results. The provision at reporting date represents
management's best estimate of the present value of the future decommissioning
costs required.
For all wells the Group has adopted a Decommissioning Policy in which all
decommissioning costs are recognise immediately when a well is either
completed, abandoned, suspended or a decision taken that the well will likely
be plugged and abandoned in due course. For completed or suspended wells, the
decommissioning charge is recorded against the capitalised amount and
subsequently depleted over the useful life of well using unit of production
method.
2. Loss per share
6 months 6 months Year ended
ended 31 December ended 31 30 June
2021 December 2021
2020
(unaudited) (unaudited) (audited)
Loss per share from continuing operations:
Basic and diluted loss per share (0.66)c (0.57)c (1.17)c
Loss per share from discontinued operations:
Basic and diluted loss per share - (0.01)c (0.01)c
The calculation above for the loss per share has been calculated by dividing
either: the relevant loss from continuing operations for the period, or the
loss from discontinued operations for the period, by the weighted average
number of ordinary shares in issue of 676,479,991 (December 2020: 519,779,401;
June 2021: 616,395,083). Where a loss has been recorded for the period, the
diluted loss per share has been made to equal the basic loss per share.
3. Discontinued Operations
During the year ended the 30(th) June 2021 the Group exited its East Texas
portfolio entirely, reflecting the previously announced strategic decision of
the Group to prioritise its Alaska North Slope asset portfolio, given the
significantly larger size, scale and resource potential. Accordingly, the
Group took the decision to fully impair the carrying value of the East Texas
properties in the previous financial year's accounts, to 30 June 2020. Weak
oil and natural gas prices, an aging lease position,a general lack of
investment by oil and gas companies into new projects and a recognition by the
Board that the Alaskan portfolio offered are far more significant risk
adjusted opportunity for the Group supported this decision. In February 2021,
Pantheon formally exited East Texas with the transfer of 100% of the Group's
interests in both Polk and Tyler Counties to Neches Transport, a local
operator. The consideration for the sale was in the form of an agreement were
the acquirer legally assumed the plug and abandonment liabilities of the East
Texas Acreage.
As a result of exiting East Texas, and in accordance with UK adopted IFRS, the
expenses for the East Texas Operation were reclassified to "Discontinued
Operations" in the relevant accounting period(s). The Consolidated Statement
of Comprehensive Income, including the comparatives, has been restated to show
the discontinued operation separately from continuing operations.
Results of discontinued operations
6 months ended 6 months ended Year ended
31 December 31 December 30 June
2021 2020 2021
$ $ $
Revenue - - -
Production royalties - - -
Depletion of developed oil and gas assets - - -
Cost of sales - - -
Gross (loss) / profit - - -
Administrative expenses - (68,941) (68,941)
General & Administrative expenses - Vision - - -
Impairment of exploration & evaluation assets - - -
Impairment of developed oil and gas assets - - -
Impairment of property plant and equipment - - -
Bad debt expense - - -
Gain on disposal of subsidiary undertaking - - -
Results from operating activities - (68,941) (68,941)
Interest receivable - 61 61
Income tax - 14,465 14,465
Loss from discontinued operations, net of tax - (54,415) (54,415)
Discontinued operations statement of cashflows
6 months ended 6 months ended
31 December 31 December Year ended
2021 2020 30 June
2021
$ $ $
Net outflow from operating activities - (263,274) (263,274)
Cash flows from investing activities
Funds used for drilling, exploration & leases - - -
Interest received - 61 61
Disposal - - -
Net cash inflow/(outflow) from investing activities - 61 61
Cash flows from financing activities
Inter-company loans - (1,635,323) (1,635,323)
Net cash (outflow)/inflow from financing activities - (1,635,323) (1,635,323)
(Decrease) / increase in cash & cash equivalents - (1,898,536) (1,898,536)
Cash and cash equivalents at the beginning of the period - 3,026,491 3,026,491
Cash and cash equivalents at the end of the period - 1,127,955 1,127,955
4. Non-current assets
Exploration and evaluation assets Exploration & evaluation
Group assets
Cost: $
At 30 June 2020 204,850,215
Additions 2,999,492
At 31 December 2020 207,849,707
Additions 21,973,907
Acquisitions 7,383,711
Asset Retirement Obligations 500,000
At 30 June 2021 237,707,325
Additions 6,707,468
At 31 December 2021 244,414,793
Impairment:
At 30 June 2020 48,752,606
At 31 December 2020 48,752,606
At 30 June 2021 48,752,606
At 31 December 2021 48,752,606
Net book value:
At 31 December 2021 195,662,187
At 30 June 2021 188,954,719
In January 2019, the Group acquired 100% of the share capital of Great Bear
Petroleum Ventures I LLC and Great Bear Petroleum Ventures II LLC companies
(collectively, "Great Bear"). The principal assets of Great Bear are leases
with the rights to explore for hydrocarbons in the State of Alaska. At the
period end the exploration and evaluation assets all relate to the Alaskan
operation; Alaskan assets $195.7m (December 2020: $159.1m), East Texas
Assets $Nil (December 2020: $Nil).
Exploration and evaluation assets are constantly reviewed for indicators of
impairment. If an indicator of impairment is found an impairment test is
required, where the carrying value of the asset is compared with its
recoverable amount. The recoverable amount is the higher of the assets fair
value less costs to sell and value in use. The directors are satisfied that no
impairments are required for the current period end.
Property, plant and equipment
Group Developed Oil & Gas Properties Production Facilities & Equipment Office Equipment Right of Use Assets Total
$ $ $ $ $
Cost
At 30 June 2020 20,290,906 4,312,960 16,099 91,995 24,711,960
Exchange difference - - - 9,524 9,524
At 31 December 2020 20,290,906 4,312,960 16,099 101,519 24,721,484
Additions - - - 1,222 1,222
Exchange Difference - - - 1,172 1,172
At 30 June 2021 20,290,906 4,312,960 16,099 103,913 24,723,878
Exchange Difference - - - (2,036) (2,036)
At 31 December 2021 - - - 101,877 24,721,842
Depreciation
At 30 June 2020 - 421,181 15,893 19,166 456,240
Depreciation for the period - - 220 24,600 24,820
Exchange difference - - (14) 2,764 2,750
At 31 December 2020 - 421,181 16,099 46,530 483,810
Depreciation for the period - - 5 25,795 25,800
Exchange difference - - (5) 1,280 1,275
At 30 June 2021 - 421,181 16,099 73,605 510,885
Depreciation for the period - - - 25,647 25,647
Exchange difference - - - (1,619) (1,619)
At 31 December 2021 - - - 97,633 534,913
Depletion
At 30 June 2020 264,578 - - - 264,578
At 31 December 2020 264,578 - - - 264,578
At 30 June 2021 264,578 - - - 264,578
At 31 December 2021 264,578 - - - 264,578
Disposals
At 30 June 2020 - - - - -
At 31 December 2020 - - - - -
Disposals for the period - 585,863 - - 585,863
At 30 June 2021 - 585,863 - - 585,863
At 31 December 2021 - 585,863 - - 585,863
Impairment
At 30 June 2020 20,026,328 3,305,916 - - 23,332,244
At 31 December 2020 20,026,328 3,305,916 - - 23,332,244
At 30 June 2021 20,026,328 3,305,916 - - 23,332,244
At 31 December 2021 20,026,328 3,305,916 - - 23,332,244
Net book value
At 31 December 2021 - - - 4,245 4,245
At 30 June 2021 - - - 30,308 30,308
5. Share Capital
In July 2021 the Company received a notice of conversion, on a one for one
basis, for all 33,890,478 of the remaining 33,890,478 ordinary shares not
carrying voting rights ("Non-Voting Shares") into ordinary shares carrying
voting rights ("Voting Ordinary Shares"). The Non-Voting Shares were
originally issued as part of the purchase consideration for the Great Bear
Companies in January 2019, as previously announced. The Non-Voting Shares are
convertible into Voting Ordinary Shares, on a one-for-one basis.
In September and October 2021 the Company received instructions to exercise a
total of 2,950,000share options. The new ordinary shares have a nominal value
of £0.01. Total proceeds to the Company for the exercised options were
$1,140,595.
In December 2021 the Company completed a placing of 47,637,583 new fully paid
ordinary shares with a nominal value of £0.01, raising gross proceeds of $41m
before expenses at an issue price of 65 pence per share. The Company also
received subscriptions for 580,946 Ordinary Shares being an aggregate amount
equal to fees due with relation to the equity raising which were reinvested
into new shares in the Company..
As at 31 December, 2021 the company had on issue 744,427,203 shares.
As at 31 December, 2021 the Company also has the following options and
warrants:
· 9,000,000 share options and 9,607,843 warrants; all with a £0.30
exercise price and all expiring September 2024. The warrants are identical to
the share options except are convertible into non-voting shares on a 1:1
basis.
· 11,750,000 share options with an exercise price of £0.27, expiring
July 2030.
· 14,655,000 share options with an exercise price of £0.33, expiring
January 2031.
6. Convertible Bonds
In December 2021, the Company issued $55 million senior unsecured convertible
bonds to a fund advised by Heights Capital Ireland LLC, a global equity and
equity-linked focused investor.
The Convertible Bonds have a coupon of 4.0% per annum and is repayable over 20
quarterly 'amortisations' of principal and interest over the 5 year term of
the loan. Such amortisations are repayable in either in cash or new Ordinary
Shares at the Company's option. The initial conversion price is measured as
the lower of £0.78 per share or a VWAP of the share price.
A summary of the principal terms of the Convertible Bonds is outlined in the
Company's RNS dated 7 December, 2021.
In accounting for the Convertible Bonds, an independent expert consultancy was
contracted to undertake a valuation of the theoretical embedded option within
the Convertible Bonds as well as the debt component. These calculations were
undertaken at issuance and again at balance date where they are marked to
market and the revaluation impact charged to the Income Statement. The
calculations valued the Embedded equity option at c.$16m at 31 December and
the associated debt component at c.$39.7m. Whilst the Convertible Bond carries
a 4% interest coupon in actual terms, applying that to the theoretical debt
component yields a calculated "effective interest rate" of 22.15% which has
been applied in calculating the interest charge for the purposes of the
financial statements.
7. Approval by Directors
The interim report for the six months ended 31 December 2021 was approved by
the Directors on the 30th of March 2022.
8. Availability of Interim Report
The interim report will be made available shortly on the Company's website
(www.pantheonresources.com), with further copies available on request from the
Company's registered office.
9. Contingent liability
Pursuant to IAS37, a contingent liability is either: (1) a possible obligation
arising from past events whose existence will be confirmed only by the
occurrence or non-occurrence of some uncertain future event not wholly within
the entity's control, or (2) a present obligation that arises from a past
event but is not recognized because either: (i) it is not probable that an
outflow of resources embodying economic benefits will be required to settle
the obligation, or (ii) the amount of the obligation cannot be measured with
sufficient reliability.
Kinder Morgan Treating L.P. ("Kinder Morgan") initiated a dispute over an East
Texas gas treating agreement between Kinder Morgan and Vision Operating
Company, LLC ("VOC"). VOC ceased making payments to the service provider in
July 2019. The service provider subsequently issued a demand to VOC and, in
February 2021, served Pantheon Resources plc with a petition, seeking to
recover not less than $3.35m in respect of this VOC contract. Pantheon held
ownership of less than 0.1% of VOC via a 66.6% interest in Vision Resources
LLC. Both Vision Resources LLC and VOC filed for Chapter 7 Bankruptcy in the
United States Bankruptcy Court for the Southern District of Texas Houston
Division in April 2020
No Pantheon entity is a signatory to the gas treating agreement and none are
named in the agreement. Pantheon has taken legal advice on the matter and
believes it has no liability to the service provider. Accordingly, Pantheon
does not consider a provision should be included with the final statements and
will contest any claim made.
In, July 2021, the court dismissed Kinder Morgan's claims against Pantheon
Resources plc. Kinder Morgan has also asserted the same claims against two
subsidiaries, Pantheon Oil & Gas, LP and Pantheon East Texas, LLC.
Pantheon Oil & Gas, LP and Pantheon East Texas, LLC are contesting these
claims.
10. Subsequent events
Testing Operations at Talitha #A
In January 2022 the Company commenced testing operations at Talitha #A,
starting from the lowest formation, the Lower Basin Floor Fan, before
proceeding sequentially to the two shallower Slope Fans and the Shelf Margin
Deltaic horizons.
In February 2022 the Company announced that testing operations had been
completed on the Lower Basin Floor Fan ("BFF"), a Brookian aged horizon. Three
separate 10 feet ("ft") intervals were perforated over 370 ft out of 600 ft of
gross section, at 9405 to 9415 ft, 9205 to 9215 ft and 9045 to 9055 ft.
These three intervals were individually stimulated and flow tested, producing
high quality c. 35 to 39 degree API oil and averaging 73 barrels of oil per
day ("BOPD") over a three day test period.
On the final day of testing, the well was flowing at a sustained rate of
approximately 40 BOPD. Encouragingly, the bottom hole pressure is near to
the reservoir pressure, thus providing an indication of the production
potential of this portion of the oil accumulation, which is at the distal
limits of the field. Future development wells would all be drilled
horizontally and stimulated with multiple stage fracs, meaning that flow rates
are expected to be many times higher.
In February 2022 the Company announced the completion of flow testing
operations on the Slope Fan System ("SFS"), a Brookian aged horizon, at
Talitha #A. The Company perforated two separate five foot intervals at 8160 -
8165 ft and 7855 - 7860 ft, within two distinct circa 50 ft sand bodies or
'lobes'. The two intervals were stimulated and flow tested together, producing
high quality circa 35 to 38 degree API oil and averaging 45 barrels of oil per
day over a three day test period. On the final day of testing, the well was
flowing at a sustained rate of approximately 32 BOPD from this combined 10 ft
of perforations, a highly encouraging result given production wells on the
Alaska North Slope are drilled horizontally, which would typically result in
materially higher flow rates.
This is the first indication of producible oil in the Slope Fan System on
Pantheon's acreage and has significant implications for future resource and
recoverable oil estimates. The two SFS lobes are in two distinct trapping
systems and suggest very good reservoir properties. The Company's initial
analysis suggests that the deeper of the two lobes extends below the Alkaid
Deep anomaly and will be assessed in the upcoming Alkaid #2 well, planned for
summer 2022. The Company has not previously provided guidance on potential
resource for the SFS.
In March 2022 the Company announced that it had suspended testing of the Shelf
Margin Deltaic ("SMD") horizon and moved its operational focus to the Theta
West well site where the Company will commence testing operations of the 950
foot Basin Floor Fan horizon.
The SMD is the shallowest and thus the final zone to test in the Talitha #A
well bore. The well was perforated in the SMD from 6,965 ft to 6,975 ft and
was successfully fracture stimulated. Immediately after the fracture
stimulation, and after flow testing operations had commenced, the test was
suspended by a blizzard on the North Slope which shut down all operations
for health and safety reasons. Flow testing operations resumed three days
later, however when flow testing recommenced the well stopped flowing after a
short period of time when only 45% of the fracture fluid was produced, with no
formation water and small amounts of light high quality 34 degree API oil.
Other than the small amounts of oil, no reservoir fluids were produced. The
consensus among the Company and external consultants is that there is a
blockage preventing any additional reservoir fluid from entering the well
bore. Based on all the data, which includes a full suite of logs, sidewall
cores, extensive Volatiles Analysis Service ("VAS") work undertaken by
AHS/Baker Hughes over the past 12 months, and the testing of the lower zones
this year, the Company's expectation for the SMD is that it should produce
better than the two lower zones already tested; the Basin Floor Fan and Slope
Fan System horizons, where the Company achieved excellent results.
Testing Operations at Theta West #1
In January 2022 the Company announced that it had spudded the Theta West #1
well, targeting two primary targets; (i) the Upper Basin Floor Fan, and (ii)
the Lower Basin Floor Fan. Combined, these horizons are estimated by the
Company to contain 12.1 billion barrels of oil in place with an estimated 1.4
billion barrels of recoverable resource. The top of the formation is estimated
at a depth of about 7,600 ft with an estimated 1,300 ft reservoir thickness.
Total depth ("TD") of 8,450 feet was reached, having drilled through both
the Upper Basin Floor Fan ("UBFF") and Lower Basin Floor Fan ("LBFF") target
horizons, which are both Brookian age, and encouragingly having encountered
approximately 1,160 gross feet of hydrocarbon bearing reservoir across both
horizons combined.
The UBFF was encountered between 6,800 and 7,000 ft, and the LBFF was
encountered between 7,450 and 8,410 ft depth. Well bore conditions in the
shallower sections above the primary objective, combined with the extremely
cold weather prevented the Company from conducting wireline operations in the
open hole, however the Company undertook Logging While Drilling ("LWD")
operations which included resistivity, gamma ray, neutron density, formation
density along with gas chromatography readings during drilling which has
provided excellent quality data, indicating the presence of hydrocarbons in
the targeted horizons some 1,500 ft structurally higher (updip) from the
Talitha #A well, 10.5 miles to the southeast. Samples analysed to date by
AHS/Baker Hughes, which have been contracted to undertake Volatiles Analyses
("VAS"), has also confirmed the presence of light oil within the UBFF and the
top portion of the LBFF, consistent with the LWD data. After casing was set,
an error by a third party service company contractor working on the rig floor
delayed testing operations. A cement stage tool was improperly configured,
placing cement inside the casing rather than outside casing as intended. The
Company was able to successfully remediate the issue which cost time and
money, however the Company does not believe this has compromised the reservoir
potential in any way. However, to correct the issue required setting a narrow
steel liner within the wellbore which resulted in a compromised wellbore
design, with the newly inserted narrow liner forming a junction with the
significantly larger diameter existing steel casing within the wellbore which
may or may not impact tested flow rates. Given Theta West #1 is a test well
and the objective is to plug and abandon it at the end of the season, whilst
it may impact tested flow rates it should not impact the Company's ability to
confirm the presence and movability of the oil, which are the primary
objectives of the testing programme.
Upon flow testing, after initially encouraging oil flow rates, the Theta West
#1 well was shut in due to the arrival of severe weather. The well flowed high
quality, light 35.5-38.5 degree API gravity oil at rates that averaged over 57
barrels of oil per day ("BOPD") with peak rates exceeding 100 BOPD over 2.5
days. Over the final day prior to shut-in the well was averaging approximately
59 BOPD. Significantly, this rate meets the Company's pre-drill
expectations, confirm the well's primary objectives; to prove the presence,
quality, and mobility of light sweet crude oil.
Theta West #1 encountered 950 feet ("ft") of oil in the LBFF of which only
three small sections of this large zone were tested. The three, 10 ft
perforations were conducted at the following depths: 8,065 - 8,075ft, 7,745 -
7,755 ft and 7,595 -7,605 ft, which were all successfully stimulated and
comingled into one test across these zones. Approximately 40% of the testing
fluid was recovered before testing was suspended. The ultimate flow potential
is better assessed after recovery of a greater portion of the testing fluid,
which was not possible in this case due to bad weather halting operations in
the area. Importantly, the results confirm the extension of the oil
accumulation over a 10.5 mile distance from Talitha #A to Theta West.
Testing operations are currently suspended due to the extreme weather which
has continued longer than expected, with it looking increasingly unlikely (at
the time of writing) that sufficient time will remain in the season to allow a
resumption testing. Notwithstanding, Theta West #1 is considered by the
Company to have been a great success, confirming a discovery, and achieving
all of its pre drill objectives - to confirm the presence of high quality
light oil and confirming the movability of this oil.
The Theta West LBFF has now been proven as an extensive oil reservoir that
Pantheon can image and map with high confidence on its proprietary 3D seismic
data.
Exercise of Options
On the 13th of January 2022 the Company announced it has issued and
allotted 2,575,000 new ordinary shares of £0.01 each ("New Ordinary
Shares") in the Company as a result of the exercise of share options.
Annual grant of share options to Directors and Staff
In January 2022 the Company announced an Annual Grant of Share Options to
directors, and staff under the Pantheon Resources plc discretionary share
option plan. The share options have an exercise price of £0.671,
representing the first traded price of the shares following the successful
completion of the £0.65 fundraising on the 8th of December 2021. The first
half of the share options granted will vest 12 months from the date of grant,
and the remaining 50 per cent will vest upon the Alkaid #2 well penetrating a
primary target; either the Shelf Margin Deltaic or the Alkaid Deep horizon.
21.7m share options have been awarded representing approximately 2.9% of the
issued share capital at the time of the award.
Exercise of Warrants into Non Voting Shares and the 1:1 conversion into
Ordinary Voting Shares
A total of 9,607,843 warrants with an exercise price of £0.30 were issued
in connection with the Company's acquisition of Great Bear Petroleum in
January, 2019 on a 50/50 basis to Farallon and Great Bear Petroleum Operating
LLC ("GBPO") (the "Warrants"). Due to restrictions under the UK Takeover
Code at the time of the acquisition, the Warrants are initially exercisable
into non-voting shares. Non-voting shares carry no
voting rights and are convertible into ordinary shares on a 1:1 basis, subject
to approval from The Takeover Panel.
The Company received an exercise notice over 4,803,922 Warrants from GBPO and
received £1,441,176.60 in associated exercise monies. Accordingly, the
Company issued and allotted 4,803,922 non-voting shares of £0.01 each
in the Company which were subsequently converted into 4,803,922 Ordinary
Shares after approval from the Takeover Panel.
Partial Conversion of Unsecured Convertible Bonds
On the 18th of February 2022 the Company announced it has received a Notice
of Conversion in respect of US$2 million of the US$55 million unsecured
convertible bond.
As a result of the conversion, the Company issued 1,937,608 new ordinary
shares of £0.01 each. The New. Accordingly, the principal remaining
under the convertible bond was be reduced by US$2 million to US$53 million.
Quarterly Repayment of Unsecured Convertible Bonds
On the 9th of March 2022 the Company announced that it elected to pay (i) the
quarterly principal repayment of US$2.65 million and (ii) the interest
payment of US$0.55 million (collectively, the "Quarterly Repayment") in
respect of the Convertible Bond, through the issuance of new shares. Pursuant
to the terms of the Convertible Bond Agreement, Pantheon has the choice of
whether to pay any Quarterly Repayment in cash or in shares. The total new
ordinary shares issued was 3,080,798.
After settlement of the Quarterly Repayment, the principal remaining under
the convertible bond will be reduced by US$2.65 million to US$50.35
million.
GLOSSARY
bbl barrel of oil mcfd thousand cubic feet per day
bopd barrels of oil per day Mmboe million barrels of oil equivalent
boepd barrels of oil equivalent per day NPV net present value
mcf thousand cubic feet $ United States dollar
bwpd barrels water per day
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR SDAEDSEESEEDRecent news on Pantheon Resources
See all newsREG - Pantheon Resources - Independent Expert Report by LKA on Alkaid Horizon
AnnouncementREG - Pantheon Resources - TR-1: Notification of major holdings
AnnouncementREG - Pantheon Resources - Webinar and update
AnnouncementREG - Pantheon Resources - Kodiak resource upgraded to 1.2 billion barrels
AnnouncementREG - Pantheon Resources - Director/PDMR Notification
Announcement