LONDON (ShareCast) - (Sharecast News) - Pantheon Resources, the oil and gas company developing the Kodiak and Ahpun oil fields on Alaska's North Slope, announced a key milestone in the development of the Alaska LNG Phase 1 pipeline.
The AIM-traded firm said the Alaska Industrial Development and Export Authority (AIDEA) had approved a resolution to negotiate a letter of credit with the Alaska Gasline Development Corporation (AGDC) to backstop the costs of front-end engineering and design (FEED) for the in-state pipeline portion of the Alaska LNG project.

AGDC, the project owner, saw that as a critical step towards securing private investment and advancing to a final investment decision (FID).

Pantheon and AGDC signed a gas sales precedent agreement (GSPA) in June, which included a requirement for the Alaska LNG project to reach FID.

If finalised, the gas sales agreement could provide Pantheon with a take-or-pay contract, potentially enabling the company to fund capital costs from the Ahpun field's FID through to achieving cash flow self-sufficiency.

"We continue to work closely with AGDC and the key decision makers in the State of Alaska to ensure that Alaskans get the maximum benefit from gas resources on the North Slope and to secure an infrastructure project essential to the long term energy security of the State and with positive impacts on US national security," said executive chairman David Hobbs.

At 1159 GMT, shares in Pantheon Resources were down 3.61% at 24p.

Reporting by Josh White for Sharecast.com.

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