Proactive Investors - Pantheon Resources PLC (LON:PANR) has announced a significant upgrade to the resource estimate of its Kodiak field, on Alaska’s North Slope.
The new estimate puts recoverable resources at 1.2 billion barrels of marketable liquids, which marks an increase of around 25% increase from previous estimates.
Natural gas resources are estimated at 5.4 trillion cubic feet, which is a very substantial volume that adds weight to previously announced proposals to build a pipeline that would connect to southcentral Alaska markets.
The new estimate includes the recent increase in the footprint of the Kodiak project area, up to 66,000 acres from 43,000, and a higher anticipated average recovery rate across the project - based on better reservoir properties in the shallower, updip portion of the field that’s present in the new acreage.
The upgrade, calculated by consultant Netherland Sewell & Associates Inc (NSAI), underlines the massive upside potential at Kodiak.
The ‘high estimate’ provided by NSAI sees 2.84 billion barrels of marketable liquids and some 11.75 trillion cubic feet of natural gas.
"This NSAI report reveals the true scale of the Kodiak Field now that we have secured leases over its full extent,” Pantheon technical director Bob Rosenthal said in a statement.
“The potential upside is vast.”
He added: “As we drill wells and obtain additional data, our goal is to progressively move the 'best case estimate' towards NSAI's 'high case estimate' over time.
"Discovering a billion-barrel oil accumulation is what companies dream about and the Independent Expert Report by NSAI validates our company's significant achievements over the past decade.
“We can now turn our attention to development, along with our growing Ahpun resource, to turn these volumes to cashflow and value for shareholders."
Pantheon chair David Hobbs, meanwhile, added: “The underpinning of our strategy with the validation provided by NSAI is an important step on the path to our 2028 goal of demonstrating values in the range $5-$10 per barrel of recoverable resource.
“Recent progress towards securing funding, include leveraging our natural gas resources - potentially turning them from a liability to an asset - allows us to move forward with increased confidence.”