Pantheon Resources Loss Widens In Eventful First Six Months

27th Mar 2018 11:07

LONDON (Alliance News) - Oil and gas firm Pantheon Resources PLC on Tuesday reported a widened loss in its first half, a period in which it experienced a number of difficulties but achieved first production.

Pantheon, whose main assets are in Texas, posted a pretax loss of USD2.6 million for the six months to December after a loss of USD874,781 in the year before. The company booked a USD1.8 million impairment charge related to the cost of sidetracking a well.

Revenue for the period was USD514,303, having posted none in the year before.

The company made "a number" of significant achievements during the period, despite challenges such as long lead times, a mixed quality of a service providers, as well as "catastrophic" flooding, perhaps the main being the beginning of production in Texas, leading to revenue generation.

In November, Pantheon's VOBM No. 1 well in Polk County began sales and the Kinder Morgan gas plant was commissioned, but then production "unexpectedly"declined. The well was shut-in and fracked, but water production continued, and Pantheon said it has the option to sidetrack the well should production keep falling.

The firm is in talks with two gas processing plants in Tyler County for gas from its VOS No. 1 well, and discussions are also underway over the joint exploitation of the Wilcox formation in the region.

VOBM No. 4 in Tyler County did not produce in commercial quantities, but Pantheon said it still demonstration the acreage's potential.

Chief Executive Jay Cheatham said: "The half year period to the end of December 2017 maintained our progress towards our stated objective but was not without challenges. Operational difficulties, long lead times, mixed quality of service providers and catastrophic flooding all contributed to hampering the rate of progress Pantheon made during this time."

"However, the group made significant achievements during and after the period including closing a heavily oversubscribed fundraising, commissioning of the Kinder Morgan gas processing facilities, increasing its working interest positions, commencement of first production and corresponding first revenues."

He added: "We look forward to progressing with the company's 2018 drilling programme and believe the knowledge we have gained will allow us to achieve our long term strategy."

Pantheon shares were down 3.5% on Tuesday at a price of 44.23 pence each.

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