Pantheon Resources plc ("Pantheon" or the "Company"), the oil and gas company with a 100% working interest in the Kodiak and Ahpun projects located in close proximity to pipeline and transportation infrastructure on Alaska's North Slope, is pleased to announce that it intends to raise a minimum of $18.5 million by way of a placing and conditional subscriptions (together the "Fundraise") of new Ordinary Shares at a price of 17 pence per share (the "Issue Price").
The purpose of the Fundraise is principally to fund the drilling of the Megrez-1 well located in the Ahpun Eastern Topset area, and, together with existing cash resources, to cover lease rentals, development of the Company's asset portfolio and provide general working capital for the Group.
Institutional investors will participate by way of a placing of new Ordinary Shares (the "Placing Shares") conducted through an accelerated bookbuild (the "Bookbuild") which will be launched immediately following this Announcement (the "Placing"). Canaccord Genuity Limited ("Canaccord") and Zeus Capital Limited ("Zeus Capital") are acting as joint bookrunners in connection with the Placing (the "Joint Bookrunners" and each a "Bookrunner"). The Placing is not being underwritten.
Certain investors will also be subscribing for new Ordinary Shares (the "Subscription Shares") at the Issue Price directly with the Company (the "Subscription"). The Subscription is conditional on completion of the Placing.
In addition to the Placing and the Subscription, retail investors will be given an opportunity to participate by subscribing for new Ordinary Shares (the "Retail Offer Shares") at the Issue Price (the "Retail Offer") on the PrimaryBid platform. A separate announcement will be made shortly regarding the Retail Offer and its terms. The Placing and Subscription are not conditional upon the Retail Offer. The Retail Offer will close on completion of the Bookbuild process.
The holder of the Convertible Bond has indicated its intention to participate in the Placing for $4 million, subject to a minimum of $18.5 million (inclusive of this amount) being raised in the Fundraise. Additionally, and subject to the same condition, the Company has agreed to prepay at the time of the Placing the final two principal amortisation payments under the Convertible Bond of $2.45 million each, originally falling due in September and December 2026, by way of issuing 22,380,254 new Ordinary Shares at the Issue Price (at a £:$ rate of 1.2879).
The Company considers it important to be able to take advantage of investor demand should investors wish to participate in the Fundraise in excess of $18.5 million. In such an event, therefore, the Company will likely increase the amount proposed to be raised pursuant to the Fundraise. Any additional proceeds above the minimum of $18.5 million, including from the Retail Offer, will be applied towards extended flow testing at Megrez-1 (in a success case), further development of the Company's asset portfolio and general corporate purposes.
The Placing is subject to the terms and conditions set out in the Appendix to this Announcement (which forms part of this Announcement).
The final number of New Ordinary Shares to be issued will be announced immediately following the closing of the Bookbuild process and Retail Offer. The New Ordinary Shares, when issued, will be credited as fully paid and will rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid on or in respect of such shares after the date of issue.
Application will be made for Admission of the New Ordinary Shares and it is expected that Admission will take place at or around 8.00 ?a.m. (London time) on 2 August 2024 (or such later time and/or date as may be agreed between the ?Company and the Joint Bookrunners, being not later than 8.00 ?a.m. (London time) on 9 August 2024). The Fundraise is conditional upon, inter alia, Admission ?becoming effective. The Placing is also conditional upon the Company having received payment from the Subscription in respect of the Subscription Shares and the Placing Agreement not otherwise being ?terminated in accordance with its terms.
The Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "IMPORTANT NOTICES" section and the detailed terms and conditions described in the Appendix.
David Hobbs, Executive Chairman, said: "We have seen a year of significant progress, which included receipt of Independent Expert Reports totalling 1.57 billion bbls of Contingent Recoverable Resources of ANS Crude, execution of a Gas Sales Precedent Agreement with AGDC (Alaska Gasline Development Corporation) that may support substantial funding of field development costs, the strengthening of governance, and alignment with shareholders. Success at the Megrez-1 well would prove up the eastern portion of our Ahpun acreage.
The location of these high-quality prospective resources immediately adjacent to the pipeline and highway are a potential gamechanger. Their materially improved reservoir characteristics when compared to the existing topsets in the western portion (and, to an even greater extent, the Alkaid horizon) of Ahpun will provide vital information in our development modelling for the overall Ahpun project. This is especially important in aligning the timetable for achieving FID for Ahpun with the proposed gas supply initiatives from AGDC and the State of Alaska."
Jay Cheatham, CEO of Pantheon Resources, said: "Management estimates have the Megrez-1 well targeting c.600 mmbls of P50 prospective resource in Ahpun's eastern topsets, where we expect excellent reservoir parameters analogous to the proven productive reservoirs now being developed at Horseshoe/Pikka and Willow, which is the source of expected new production growth on the Alaska North Slope. Company-modelled individual well economics in the eastern topsets, if successful, have the potential for very attractive NPV10s exceeding $30/bbl (at $80 oil). Our technical team, which has a 100% drilling success rate encountering oil pay when based on 3D seismic AVO, has assessed the probability of discovering oil at Megrez-1 at 69%, based on data acquired over a decade especially from nearby discoveries in Pantheon's acreage and seismic anomalies. The size, location and potential economic impact of a success case at Megrez-1 make it amongst Pantheon's most impactful drilling ventures with the potential to transform the Greater Ahpun development project and the entire company.
The measure of our confidence in the success of this low risk well on the eastern extension of Ahpun and the wider Pantheon asset portfolio is that all of our Board and certain key advisers are participating for a combined amount of c.$1.0 million in the Fundraise."