Pantheon Resources: Acquisition of Increased Working Interest in Polk County Prospects

RNS Number : 5320E
Pantheon Resources PLC
19 July 2016

19 July 2016

 Pantheon Resources plc

 Acquisition of Increased Working Interest in Polk County Prospects

Pantheon Resources plc (“Pantheon” or “the Company”), the AIM-quoted oil and gas exploration company with a 50% working interest in several projects in Tyler and Polk Counties, onshore East Texas, is pleased to provide the following operational update:

 Acquisition of Additional Working Interest in Polk County, East Texas

The board of Pantheon is pleased to announce the acquisition of an additional 8% working interest in the “West Double A”* and “West West Double A”** prospects (previously referred to respectively as “New Prospect A” and “New Prospect D”), located in Polk County, East Texas.  Upon completion of the acquisition, Pantheon’s working interest in these two prospects, including the VOBM#1 discovery well, will increase from 50% to 58%. Pantheon’s working interest in its Tyler County prospects remains unchanged at 50% and its working interest in “New Prospect E” remains unchanged at 25%.

Purchase consideration for the 8% working interest comprises an up front cash payment of US$6.5m, plus an additional 20% of the drilling and completion costs of the VOBM#2H and VOBM#3H wells, estimated to be between US$1.0m and US$1.25m per well. In relation to the 8% working interest acquired, Pantheon will benefit from an accelerated payback mechanism whereby it will receive a 2.5x uplift on production revenues until such time as the acquisition cost has been recouped, at which point revenues will revert back to an 8% revenue interest.

The opportunity to acquire this additional working interest at a favourable price has arisen as a result of an internal reorganisation within the privately-owned Vision group. By mutual agreement no third parties have been involved. The transaction maintains the confidentiality of intellectual property within the group, minimises mid-drilling disruption and reinforces the excellent established relationship between Pantheon and Vision.

 Jay Cheatham, CEO of Pantheon, said:

“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. For commercial reasons Bobby Gray, Vision’s founder, and I are both committed to maintaining the two-party structure wherever possible and this transaction accomplishes that mission speedily and to our mutual advantage”.


Pantheon: Update on VOS#1 well, Tyler County, onshore East Texas

Location_6_jpgRNS Number : 6145D
Pantheon Resources PLC
08 July 2016

8 July 2016

Pantheon Resources plc


Operational Update




Pantheon Resources plc (“Pantheon” or “the Company”), the AIM-quoted oil and gas exploration company with a 50% working interest in several projects in Tyler and Polk Counties, onshore East Texas, is pleased to provide the following operational update:



Update on VOS#1 well, Tyler County, onshore East Texas


Pantheon has been advised that permitting has now been granted in relation to the planned fracture stimulation and testing procedure at VOS#1. The operator has contacted its preferred service company to undertake the procedure and has been advised that the estimated first availability for commencement of operations is in early August 2016, given their currently committed fracking schedule. Pantheon cautions that this estimate is to be considered for guidance only and is dependent upon factors outside of its control. Results will be announced once flow testing operations are completed.


Both Pantheon and the operator are also pleased to announce that they have decided to perform the fracture stimulation procedure over the shallower Austin Chalk section in addition to the highest potential Eagleford sandstone sections. The opportunity to gain valuable data points from the Austin Chalk would not have been available had the well been put onto production from the deeper Eagleford sandstone formation, so offers a one-off opportunity to assess the potential of this zone.  The Austin Chalk showed very positive log responses in this well as it did from the nearby LP2 well, both of which are untested.



Update on VOBM#2H well, Polk County, East Texas


Pantheon is pleased to advise that operations at VOBM#2H well are proceeding smoothly; the drilling operations are approximately five days behind on time, but are ahead on budget. Results from the well will be announced when drilling and, if appropriate, testing operations are complete.



Jay Cheatham, CEO of Pantheon, stated,


“I am pleased to announce that we have been granted the permit to perform the fracture stimulation test on the VOS#1 well and as part of this we also now have the opportunity to gain valuable data from the independent Austin Chalk zone, above the discovered Eagleford sandstone section. I am also pleased to note that the VOBM#2H well is proceeding in line with expectations, which is a great achievement given it is the first horizontal Eagleford sandstone well in the area. We couldn’t pass up the opportunity to frack the Austin Chalk in this vertical well”




TOMCO: Extension of Construction Permit Related to Ground Water Discharge Permit

RNS Number : 6097D
TomCo Energy PLC
08 July 2016


8th July, 2016


TomCo Energy plc (AIM: TOM )

(“TomCo” or the “Company”)


Extension of Construction Permit Related to
Ground Water Discharge Permit UGW 470003, Holiday Block Project


Further to the announcement made by TomCo on 17th July 2015, the Company is pleased to announce today that Utah’s Division of Water Quality (“DWQ”) has approved TomCo’s extension request to its Construction Permit which, itself, is related to the Company’s Ground Water Discharge Permit  (“GWDP”,’UGW 47003′) that was approved by the DWQ on 16thJuly 2015.


The Company’s Construction Permit has been extended to 15th July 2020 and, therefore, is now on the same term as its GWDP which is five years from the date of issuance.


Andrew Jones, Chairman of TomCo, said“This long term extension is excellent news for TomCo. The Company is well placed to monitor progress and await further developments from its technology partner Red Leaf including its joint venture with TOTAL and Red Leaf’s Early Production Stage Capsule, whilst we develop our new palm oil division and concentrate on producing cash flows in the near-term. We thank the DWQ for their continued support.”




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The Biggest Key (By Far) to Making Huge Money in Resource Stocks

The Biggest Key (By Far) to Making Huge Money in Resource Stocks
Dear Reader,

On June 18, 2014, the price of crude oil traded for $106 a barrel.

Just 19 months later, the price had plummeted 73% to $28 per barrel.

After reaching $28 per barrel, oil then skyrocketed 88% in just four months.

What sort of asset regularly goes through massive price swings like that?

Not your house…and not government bonds.

Natural resources do.

More than any other asset, natural resource prices go through extraordinary booms and busts. One year, the value of a resource like oil, silver, or copper will skyrocket 75%. The next year, it will fall 50%.

Because natural resources cycle through huge booms and busts, they are said to be “cyclical” assets.

Many things in our world move in cycles. The weather moves in cycles. The planets revolve around the sun in cycles. Animals move around their habitats in cycles.

You also see cycles in the financial markets…especially in the natural resource sector.

Because resources cycle through booms and busts, they are said to be “cyclical” assets. Understanding this concept is by far the biggest key to making huge returns in the natural resource sector.

If you don’t understand how resource cyclicality works, nothing else you do will matter. It’s the most important thing.

The cyclicality of natural resources contrasts with “noncyclical” businesses like those that sell toothpaste, toilet paper, or food.

Demand for everyday things like these is relatively constant. No matter what is happening with the economy, you’re probably going to brush your teeth, go to the bathroom, and eat lunch.

Natural resources, however, exhibit extreme cyclicality. And their massive price moves produce massive opportunities to profit.

In the year 2000, for example, shares in the world’s largest uranium mining company, Cameco, traded for $1.35 per share. Seven years later, Cameco shares had increased in value by 3,600%, reaching $50 per share.

Gains like that are possible in natural resources because of their unique supply/demand dynamics…

When the price of a natural resource soars, it encourages lots of new production. Natural resource producers always want to cash in on high prices.

For example, if corn soars in price, farmers will plant a lot more corn.

If the price of oil soars, oil companies will pump a lot more oil.
This natural response to high prices leads to an increase in the supply of the natural resource.

The soaring price also encourages consumers of that resource to find cheaper replacements. For example, if gasoline were to triple in price, you would be more likely to take the bus or cut back on car trips. If the price of coffee soars, you might start drinking tea instead.

This natural response to high prices leads to a decrease in demand for the natural resource.

When the supply of a natural resource increases and demand for it decreases, you get much lower prices. You get a bust. In other words, a resource bull market eventually sows the seeds of its own destruction.

When a boom ends, it’s not unusual to see the value of a natural resource plummet in a short amount of time. Remember, the price of oil plummeted 73% in less than two years.

A natural resource boom is the mirror image.

When the price of a natural resource is very low, it discourages production.

After all, why ramp up production if the price is in the toilet?

The farmers who planted as much corn as they could when prices were sky high will plant a lot less corn if prices are low.

The oil companies that produced as much oil as they could when prices were high will produce less if prices are low.

Low prices also encourage consumption. You’re probably going to drive more if the price of gasoline plummets.

When the supply of a natural resource shrinks and demand climbs, you get a boom. In other words, a resource bear market eventually sows the seeds of its own destruction.

Recent history in the copper market provides a great example of this.

During the 1990s, the price of copper was very low. This lead to decreased production. Meanwhile, demand for the cheap resource soared.

This “increased demand/decreased supply” sandwich caused the price of copper to soar from $0.75 per pound in 2003 to $4 per pound in 2008 (a 400%+ gain).

When a natural resource moves in price, the share price movements of natural resource producers are amplified. During the big 2003 – 2007 copper rally, the large copper miner Freeport-McMoRan skyrocketed from $3.50 per share to over $50 per share during this time–a 1,300%+ increase.

By now, you surely see what we need to do as resource investors.

***We need to invest in individual resource markets when prices are very cheap and depressed, yet poised to climb.
This setup led to the 1,300% gain in Freeport McMoRan…and the 3,600% return in Cameco.

To make huge gains in natural resources, we have to buy assets after bear markets…when they are very cheap and depressed.
In these situations, you’ll be buying something the investment crowd doesn’t want. But that’s a sign you’re probably doing the right thing.

When the crowd finally realizes a boom after it has already started, it will bid the price of your assets up to incredible heights. That’s when you–the contrarian–can sell for huge profits.

Resource markets are extremely cyclical.

Their enormous booms and busts make it tough for most people to make money in them.

But extreme resource cyclicality offers huge opportunity to those of us who understand it.


Marin Katusa