Pantheon Resources (LON:PANR) Placing, Subscription and Acquisition

Proposed Placing and Subscription to raise a minimum of approximately US$16.0 million

Acquisition of Great Bear Companies

Pantheon Resources plc (AIM:PANR), the AIM-traded oil and gas exploration company with a 50 per cent. – 75 per cent. Working Interest in several conventional project areas in Tyler and Polk Counties, onshore East Texas, announces a proposed Capital Raising to raise a minimum of US$16.0 million (before expenses).

Alongside the placing, Pantheon intends to acquire two wholly owned companies from Great Bear Petroleum Operating LLC (“Great Bear”) (the “Acquisition”), Great Bear Petroleum Ventures I LLC and Great Bear Petroleum Ventures II LLC (together the “Great Bear Companies”). The main assets of the Great Bear Companies are leases with the rights to explore for hydrocarbons in Alaska (the “Leases”).

Arden Partners plc (“Arden”) is acting as Nominated Adviser and Sole Broker to Pantheon. Defined terms used in this announcement have the same meaning as set out at the end of this announcement.

Highlights:

· The Company intends to conduct a placing and subscription raise a minimum of US$16.0 million via the Placing of new Ordinary Shares (“Placing Shares”) at a price of no less than 15.25 pence per New Ordinary Share (“Minimum Issue Price”). The Placing and Subscription are conditional, amongst other things, on shareholder approvals.

· The Company has conditionally agreed to acquire the Great Bear Companies which have over 250,000 leased acres onshore North Slope of Alaska, are well located to infrastructure, and whose acreage has an estimated P50 Technically Recoverable Resource (Gross) of 2.0 billion barrels oil.

· Over US$200 million invested into the Great Bear assets to date, including over 1000 square miles of 3D seismic

· The Great Bear acreage contains two discovery wells with six hydrocarbon bearing zones, including the Alkaid discovery well (“Alkaid”) which has been drilled, cased, logged and sidewall cored, and awaits flowtesting.

· The Acquisition is conditional on, inter alia, the completion of the Capital Raising, approval by the State of Alaska, Department of Natural Resources, and the passing of certain resolutions at a general meeting, further details of which are set out below.

· Purchase consideration for the Great Bear Companies values the assets at approximately US$49 million, being approximately 49 per cent. of the value of the combined entities, pre Capital Raising. The consideration consists of a combination of Ordinary Shares, non-voting B Shares, cash and Warrants. The shares component of the consideration will be capped at 100,000,000 Ordinary fully paid shares (“Ordinary Shares”), with the remainder comprising a non-voting B shares.

· Subject to completion of the Acquisition and Capital Raising, the Company intends to:

o undertake a flowtest of the Alkaid well (75 per cent. Working Interest) with potential for 549 million bbl. oil (P50 Technically Recoverable Resource) over 3 independent zones, commencing in the first quarter of 2019;

o participate in a carried 10 per cent. Working Interest exploration well on the Winx prospect (“Winx”) with potential for 400 million bbl. oil (P50 Technically Recoverable Resource) in the first quarter of 2019; and

o drill a sidetrack to the VOBM#1 discovery well in East Texas which was compromised by collapsed casing. The VOBM#1 well flow tested at 6000mcf/d natural gas and 500 bopd oil.

· The Company intends to appoint Bob Rosenthal, Jeremy Brest and Carl Williams to the Board of the Company. Further details of the appointment of these proposed Directors is set out below.

· The Placing is to be conducted by way of an accelerated bookbuild process (the “Bookbuild”) which will commence immediately following this Announcement in accordance with the terms and conditions set out in the Appendix to this Announcement.

· Completion of the Capital Raising is subject, inter alia, to Shareholder approval of certain resolutions to enable the issue of the new Ordinary Shares and non-voting B shares, which will be sought at a General Meeting of the Company , details of which will be announced in due course.

· The Minimum Issue Price represents a discount of approximately 10.3 per cent. to the closing price of 17 pence on 20 December 2018, being the last practicable date before this announcement

· Following the Acquisition and the Capital Raising, the existing Pantheon shareholders will own, in aggregate, approximately 43 per cent. of the Enlarged Share Capital

· A Circular containing further details of the Placing including a notice convening the General Meeting is expected to be despatched to Shareholders shortly following completion of the Bookbuild and will thereafter be available after publication on the Company’s website at www.pantheonresources.com.

The existing and proposed Directors have indicated that they intend to participate in the Subscription for an aggregated amount of £256,000. The ultimate allocation to the Directors is at the absolute discretion of the Sole Bookrunner and the Company.

The number of Placing Shares to be issued will be determined based on the exchange rate between the U.S. dollar and pound sterling on the date on which the Bookbuild is closed. Any reference to gross or net proceeds in this Announcement or any other amount in this Announcement stated in US$ assumes an exchange rate of 1:1.267, being the exchange rate between the U.S. dollar and pound sterling on 20 December 2017.

Jay Cheatham, CEO of Pantheon Resources, said:

“I am extremely pleased that we have the opportunity to bring such quality assets into Pantheon, and to complete a significant fundraise in extremely difficult market conditions when other trans-actions are being pulled. The fundraise provides capital for an incredibly impactful winter testing with three significant wells, in both East Texas and Alaska. In addition to the geological prospects, the transaction delivers a very talented and experienced team who bring the added benefit of adding to our East Texas knowledge. 2019 will certainly be an exciting year for our company.”

 


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