Pantheon Resources ' (PANR) much-hyped and near-impeccable track record of onshore drilling in East Texas has ended. This week, shares in the oil and gas explorer cratered by 40 per cent after drilling at the VOBM#2 well was suspended following a series of equipment failures and unexpectedly hard sandstone was encountered.
Chief executive Jay Cheatham said the decision to try horizontal drilling at the second Polk County well - at a gross cost of between $5.6m and $6m (£4.2-£4.5m) - had "not worked out as we expected and that technique will not be repeated". The company will now revert to a vertical well drilling to prove out the resource base at VOBM#2 and drill a further well nearby.
Meanwhile, further testing will be needed to establish the flow volumes from the VOS#1 well, which failed to generate a significant increase in flow rates in a recent fracture stimulation, thereby further compounding investors' woes.
