19th Jul 2016 09:25
LONDON (Alliance News) - Pantheon Resources PLC on Tuesday said it has acquired an additional 8% working interest in the West Double A and West West Double A prospects in Polk County, East Texas, taking its overall stake to 58%.
West Double A and West West Double A had previously been known as New Prospect A and New Prospect D.
Pantheon will pay an upfront cash payment of USD6.5 million, plus an additional 20% of the drilling and completion costs of the VOBM#2H and VOBM#3H wells, estimated to be between USD1 million and USD1.3 million per well.
Pantheon said it will benefit from an accelerated payback mechanism whereby it will receive a 2.5 times uplift on production revenue until the acquisition cost has been recouped, at which point revenue will revert back to an 8% revenue interest.
"This transaction is a fantastic opportunity for Pantheon to increase our interest in these two outstanding prospects, where we have already completed one successful discovery well and are close to completing the second well. We can comfortably fund the acquisition from existing cash resources and the price is an attractive one, given the circumstances and our ability to move quickly to complete," Chief Executive Jay Cheatham said in a statement.
Shares in Pantheon were trading up 5.6% at 141.73 pence on Tuesday morning.
By Karolina Kaminska; [email protected] @KarolinaAllNews
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Pantheon Resources plc