Canaccord initiates coverage on Pantheon Resources at 'speculative buy'

Canaccord said Pantheon had "a very rare opportunity" for a small exploration and production, with a high percentage operatorship of very large potential developments in a "harsh but safe" and "relatively low-cost" operating environment onshore Alaska.

The Canadian broker said two projects stood out to it as the most advanced - Greater Alkaid, which has been drilled and tested flowing oil, and Talitha, which lies adjacent to and just updip of an earlier discovery well.

Canaccord said the two potential developments benefitted "enormously" from their close proximity to all required oilfield services about 20 miles to the north at Prudhoe Bay field, with easy physical access via the Dalton Highway, and crude oil export through a hot tap into the Trans Alaska Pipeline System, both of which pass directly across Pantheon's licences, allowing rapid and low-cost conversion of resource to cashflow.

"The company plans to drill the (much) larger of its two projects, Talitha, in which it has an 89% interest, in Q1 21. Talitha has three anticipated independent reservoir zones, all of which contained oil in nearby well, Pipeline State-1 (PS-1), and the prospect is covered by 3D seismic," said Canaccord.

"The well is expected to be drilled about six kilometres updip of PS-1, effectively a step-out appraisal location."