Pantheon Resources surges after oil and gas flow from Texas well

US-focused oil explorer Pantheon Resources impressed with the “transformational” results of flow-testing from one of its 50%-owned well in Polk County, onshore East Texas, showing the potential for commercially viable extraction of gas and oil.

The AIM-quoted company, which has 50% working interests in several projects in Polk and nearby Tyler County, said testing at the VOBM#1 well encountered 62 feet of net pay, at a depth of circa 14,200 feet, in the Eagle Ford sandstone, the primary target of the well.

Pantheon said the well showed gross production that equated to over 1,500 barrels of oil equivalent per day (boepd).

Initial flow rates and other testing data indicate that the well has the potential to exceed the pre-drill prospective resource (recoverable) estimate per well of 1.4MMboe, however the company cautioned that it will take a period of sustained production data before a more definitive assessment can be made.

Chief executive Jay Cheatham said: "Today's news is truly a transformational event for Pantheon. The VOBM#1 well is expected to contribute valuable revenue and NPV to our company, particularly in the context of the exceptionally low operating costs expected for these wells."

However he declared the important of the result in confirming management's understanding of the geology and interpretation of the seismic "and gives validation to the incredibly detailed geological study undertaken with our partners over the past few years".

Shares in Pantheon were up 53.5% to 61.4p at 1540 GMT on Wednesday.