LONDON (ShareCast) - (Sharecast News) - Pantheon Resources has reported preliminary results from the first of six planned flow test intervals in its Megrez-1 well on Alaska's North Slope on Monday.
The AIM-traded company said the Topset 1 (TS1) reservoir, located between 7,165 and 7,453 feet measured depth, was fracture stimulated and flowed for 12 days, producing sustained high fluid rates of over 1,000 barrels per day.

However, the interval yielded no appreciable hydrocarbons at surface.

The firm said the TS1 zone appeared to be in a transition area with oil present, but limited or no mobile hydrocarbons.

Preliminary analysis, including produced water salinity, suggested residual oil saturations were insufficient to sustain flow to the surface, despite strong pressure support and high flowback rates.

Pantheon noted that the technical data gathered from the test strengthened confidence in the presence of mobile hydrocarbons in shallower zones of the well, where log and core analyses indicated higher saturations.

The TS1 interval would now be abandoned, and operations would move on to the Lower Prince Creek formation once high-pressure pumping equipment is mobilised to the Megrez pad.

The company emphasised that the testing programme was focussed on data quality rather than maximising initial flow rates, with the goal of building a comprehensive understanding of the reservoir system to inform future development decisions.

Testing of the remaining intervals, including the shallower Lower Sagavanirktok zone 3, would continue sequentially.

"Whilst at face value it appears disappointing that the first and deepest interval did not produce material hydrocarbons, when you take a closer look, the data we gathered leaves us with increased confidence in the five shallower and more productive horizons that remain to be tested," said chief executive officer Max Easley.

"We are confident that these further five zones will, in aggregate, add high quality inventory to our already significant 1.6 billion barrels of certified resources in Ahpun and Kodiak.

"We look forward to sharing the next set of results as they become available."

At 1110 BST, shares in Pantheon Resources were down 45.5% at 28.45p.

Reporting by Josh White for Sharecast.com.

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