Pantheon Resources PLC (AIM:PANR, OTCQX:PTHRF) shares gained more than 20% in Monday's exchanges after it reported that its Dubhe-1 appraisal well on Alaska's North Slope exceeded pre-drill expectations in the primary SMD-B target.
"We are delighted to announce the Dubhe-1 pilot hole results as a success," said chief development officer Erich Krumanocker.
"The well confirms the presence and quality of the oil and gas reservoirs in the Ahpun field, exceeding our pre-drill expectations."
Pantheon said the hydrocarbon column in the SMD-B zone measured 565 feet, which is above its pre-drill estimates.
Hydrocarbon-bearing intervals were also encountered in the SMD-C and two Slope Fan zones, which were not included in Pantheon's previous contingent resource estimates, and these may represent upside for future co-development alongside SMD-B.
Pantheon told investors it will now drill a lateral sidetrack in the SMD-B to support flow testing and refine its production model. It is also analysing the data to optimise hydraulic stimulation plans.
"We are now transitioning toward field development planning in support of capital-efficient commercial production," Krumanocker added, "the upside presented by the SMD-C and Slope Fan zones highlights the enormous potential in our portfolio."
Drilling operations are expected to start for the sidetrack in the coming days.
Pantheon shares shot up 6.11p or 22.3% changing hands at 33.05p.
"Overall this is a good start to Pantheon’s Dubhe-1 well," Zeus Capital analyst Daniel Slater said in a note, "Finding hydrocarbons in other secondary targets is also a positive, both for future resource numbers and the long-term potential of the company’s Alaska assets.
"We await further news from Dubhe-1 as the horizontal section is drilled and fracked, and flow testing is carried out."