In June 2006, Pantheon expanded its operations by farming-into a natural gas exploration venture in Wharton County, south Texas, located broadly between Houston and Corpus Christi. This venture is operated by the Everest Resource Company ("Everest") which has a long and successful history in the Texas Gulf Coast Area. This project provides Pantheon with low risk/reward plays to balance the higher risk/reward plays at the PI Project Area.

Project Wharton location map

The Project Wharton farm-in comprised three prospects initially, since expanded to six. The prospects have been identified using high-quality 3D seismic.  These prospects are smaller in size and risk than Padre Island. Reserves estimates per well range from 0.5 to 4.0 billion cubic feet ("bcf"). This farm-in was considered complementary in terms of risk to the high impact PI Project Area. The exploration risk is regarded as low, with probability of success ranging from 50-80%.

Each well has multiple objectives. As not all objectives have been included in the evaluation, this provides additional upside potential.

This initial drilling campaign delivered a 75% success rate. The Company is now producing from three natural gas fields; Zebu, Mohawk and Baptist. 

Zebu (Pantheon 9.375%)

Zebu #1 was discovered in August 2006 and commenced production on September 29, 2006. The well is currently producing (May 2008) around 325 thousand cubic feet of natural gas per day (mcfd). Zebu discovered natural gas in two Frio sands. It produced from the deeper zone at around 4,280 feet ("ft") until December 2006. The primary objective, which encountered natural gas at around 3,750 ft, was completed at that time.

Mohawk (Pantheon 18.75%)

Mohawk was a 5,000 ft deep extension opportunity in the Chesterfield Field, Wharton County.  Mohawk was drilled and completed in September 2006.  Mohawk #1 was brought into production at 110 mcfd through a 4/64 inch choke. Mohawk currently produces about 260 mcfd (May 2008).

Caddo (Pantheon 18.75%)  

Caddo #1 encountered gas in a shallow Frio formation at around 4,470 ft and was completed in November 2006. The well watered out and was re-completed in December 2007. However the production was short lived and the well was abandoned in first quarter 2008.

The Caddo #1 discovery is particularly important. It is located in an area of mutual interest that covers a large area where other prospects exist. These target comparable Yegua and Frio anomalies, but Miocene objectives are also present in all of them.

Dakota (Pantheon 18.75%)

Dakota #1 well was plugged and abandoned as non-commercial in late September 2006. Both natural gas and formation water were recovered from three zones.

Additional prospects are located on the Dakota area of mutual interest ("AMI") which covers around 1,950 acres. These still remain attractive targets for future drilling. As these are not subject to the farm-in terms, they would have a higher value to Pantheon.

Kant (Pantheon 18.75%)

This well was plugged and abandoned as non-commercial in early January 2007, having spudded on late December 2006. Hydrocarbons were present in the primary objective. However the well was deemed non-commercial due to low natural gas saturation and thin reservoir sands.

Baptist (Pantheon 11.25%)

The Baptist #1 exploration well encountered natural gas in both its primary and secondary objectives. The Baptist #1 well was drilled to test a large Frio seismic amplitude anomaly revealed by the Shell East Graceland 3D (vintage 1996). Baptist was completed in April 2007 and is currently producing about 250 mcfd (May 2008).