We are increasing our TP for Pantheon Resources to 39.1p from 32.0p (+22%). The change reflects i) Michael Spencer’s appointment as Non-Executive Chairman, one of Britain’s most recognised and successful entrepreneurs, ii) rising energy prices, iii) increased focus on energy security due to the wars in the Middle East and Ukraine, recognising Pantheon Resources’ assets are ideally positioned to produce oil & gas from the safety of the USA into the Pacific Basin markets, iv) growing interest in Alaskan oil & gas developments from major oil & gas companies, v) robust political support for Alaskan oil & gas from the US Government, vi) strengthening balance sheets of oil & gas companies, favouring a farmout of Pantheon Resources’ assets on advantageous terms, vii) a Uturnfrom US banks favouring the funding of upstream oil & gas assets, particularly in Alaska, viii) the announcement of increased cost discipline within Pantheon Resources, and ix) the announcement by Pantheon Resources that it will give strategic priority to its highest quality and largest scale asset, namely, Kodiak (1.2 billion barrels of 2C recoverable resources based on the estimates of Netherland Sewell and Associates; 271.5p success case valuation based on Oak Securities’ assumptions and estimates).
