Pantheon Resources PLC (AIM:PANR, OTCQX:PTHRF) has raised $10 million through a share placing to fund the restart of testing at its Dubhe-1 well in Alaska and to upgrade seismic data at its Kodiak project, as the company presses ahead with plans to prove up what it believes could be a sizeable oil and gas resource.
The London-listed explorer sold just over 106 million new shares at 7.0p each, a discount to the previous market price.
Pantheon said the fresh investment would support near-term appraisal work at its Ahpun and Kodiak projects on Alaska’s North Slope, an area already close to pipelines and transport infrastructure, as well as covering general working capital needs.
A large part of the funds will go towards preparing for the resumption of flow testing at the Dubhe-1 well. Flow testing is designed to show whether oil and gas can be produced at commercial rates over a sustained period, rather than simply being present in the ground.
Pantheon said the work programme would include analysing new and existing well data and preparing for what it described as a “cost-effective and productivity-enhancing start-up” of the testing process.
The company believes Dubhe-1 could be key to commercialising an estimated 282 million barrels of liquids classified as a 2C contingent resource in the Shelf Margin Deltaic reservoir.
In industry terms, a contingent resource refers to oil or gas that is thought to be recoverable but is not yet considered commercially viable, usually because more testing or approvals are needed.
The 2C category is a mid-range estimate, intended to reflect a realistic view rather than a best- or worst-case scenario.
Pantheon says the wider Greater Ahpun area could hold more than 500 million barrels of 2C contingent resources in total, and that progress at Dubhe-1 would also support a gas offtake precedent agreement with the State of Alaska.
Any remaining proceeds from the placing will be used to reprocess existing seismic data at Kodiak. Seismic reprocessing uses modern computing techniques to extract clearer images of underground rock structures from older data, potentially improving confidence in where oil-bearing reservoirs sit.
The company said the upgraded data could support drilling an appraisal well at Kodiak as early as the 2026/27 winter season, subject to further financing.
Independent experts have assessed Kodiak as holding 1.2 billion barrels of recoverable liquids on a 2C basis, with potential upside to 2.8 billion barrels on a higher, more optimistic 3C estimate.
Pantheon added that several parties were already in farm-out discussions over Kodiak. A farm-out typically involves bringing in a partner to fund part of the drilling costs in exchange for a stake in the project, helping to spread risk.
The placing was run by Oak Securities and the new shares will rank equally with existing shares. Application has been made for the shares to be admitted to trading on AIM, the junior market of the London Stock Exchange, with admission expected on or around 22 January.
Max Easley, chief executive, said: “Today’s financing further enables our forward programme at Dubhe-1. Prior to the suspension of testing in December, the well was exhibiting increased gas production volumes, and we are very keen to recommence operations after pressure build-up and other analysis has been completed.
“Completion of the testing programme will determine the next steps for the development of the Ahpun asset and will potentially unlock significant value for the Company.
“In addition, upgrading the seismic over the Kodiak structure now may significantly strengthen our position in ongoing farm-out discussions.”