25th Mar 2015 09:40
LONDON (Alliance News) - Pantheon Resources PLC Wednesday said, alongside its joint venture partner in East Texas in the US, it agreed heads of terms for the contracting of a rig to drill two wells in the area, but said there would be "modest delays" caused by severe weather conditions in recent weeks.
Pantheon is working with its joint venture partner and operator, Vision Gas Resources LLC, on projects within the Tyler and Polk Counties in East Texas. Both companies hold a 50% stake each in the projects.
Pantheon said the first well in the programme will be located on the Tyler county acreage near a formerly drilled producing well and will target both the Woodbine/Eagleford sandstone and the Austin Chalk.
The second well will be drilled immediately after the first on the Polk country acreage and will also target the Woodbine/Eagleford sandstone.
"Of particular importance in the context of the recent falls in oil and gas prices, is that both wells are conventional and if successful, are forecast to be economic below current commodity prices," said Pantheon in a statement.
Originally, the first well was targeted to be completed before the end of the first quarter of 2015, but, on Wednesday, Pantheon said severe weather conditions in East Texas in recent weeks has caused flooding in areas which are due to be drilled.
"The severe weather conditions of recent weeks, which have included torrential rainfall and localised flooding in certain areas of East Texas where drilling is planned, have resulted in what is expected to be a modest delay to the start of operations at the drilling site," it said.
Pantheon said it expects operations to begin in two to three weeks time based on current weather forecasts.
Pantheon shares were down 2.3% to 16.61 pence per share on Wednesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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