rsa Major’s third-brightest star, at the tip of the Great Bear’s tail (or Big Dipper’s handle), is named Alkaid. The constellation contains two dimmer stars named Talitha Borealis and Talitha Australis that form the bear’s front paw. Alkaid and Talitha are also the names of two North Slope units held by Great Bear Pantheon, an oil exploration subsidiary of Pantheon Resources.
While Pantheon Resources may be minor compared to some of the Slope’s larger players, its current drilling program is yielding some major numbers. In its most recent shareholder webinar held in March 2023, the company announced that oilfield services company SLB (previously Schlumberger) estimates that there are roughly 17.8 billion barrels of oil in place across the company’s reservoirs, including the recently drilled Theta West project area.
Shortly ahead of the webinar, Pantheon also shared a Wood MacKenzie report that described the company’s Theta West-1 well as the “fourth-biggest discovery well globally in 2022.” Though the area needs additional drilling and testing before potentially being considered commercial, this discovery put a positive spin on what has been a tumultuous year, which also included testing at the Talitha-A discovery well and a long-term production test at the Alkaid-2 well.
The Alkaid project’s location, right along the Dalton Highway and Trans Alaska Pipeline System (TAPS), allowed the well to be drilled from a gravel pad last summer, followed by the long-term production test this winter.
“Probably our biggest challenge this past year has been managing people’s expectations about what we’re seeing and doing at our Alkaid-2 well,” says Technical Director Bob Rosenthal of Pantheon’s dip in share prices because of what the company calls miscommunication and misconceptions. “But we’ve seen a lot of fluids and a lot of volume at Alkaid-2, and we’re extremely encouraged about the future.”
Through Alaska operating company Great Bear Pantheon, Pantheon has been on the North Slope in some form since 2010. The company originally drilled Alkaid-1 in 2015 but had to cut its winter season short when the Sagavanirktok River flooded the Dalton Highway. In 2019, the company resumed work.
“We perforated a 6-foot interval along with a small fracture stimulation that produced more than 100 barrels a day during flow testing,” says Rosenthal. “We were very happy with that result at that time.”
The company proceeded with an active exploration and appraisal program during the winters of 2021 and 2022, drilling and testing the Talitha-A and the Theta West-1 wells, which resulted in the discovery of an estimated 20 billion barrels of oil in multiple reservoirs and multiple pools, with more than 2 billion barrels of contingent resource, including a risk adjusted contingent resource of 76.5 million barrels at Alkaid, where the current long-term test well Alkaid-2 is located.
“To make these reservoirs effective, you need to do long laterals and stimulate the rock, and that’s what we did,” says Rosenthal of last summer’s work at Alkaid-2, which included drilling a 5,000-foot lateral with thirty fracture stages. “When we tested the well in early November, we were producing 325 barrels a day of condensate and natural gas liquids [NGLs] and 180 barrels of really high-quality oil. We produced IP30 [average oil production over the initial 30 days] calculated at 500 barrels of hydrocarbon fluids [oil, condensate, and NGLs] out of the Alkaid-2 well.”
Rosenthal considers that a good result. “We expect to improve the performance of future wells because, historically, in every one of the reservoirs in the Lower 48 using this technology, they’ve seen improvements in terms of operating capabilities after initial wells. The design of completion and stimulation and how you place the wells can provide much improved reservoir performance,” he adds.
The location also gave Pantheon the advantage of being able to drill from a gravel pad next to the highway. “We had the opportunity to do what few others could do because they can only drill in the winter using ice pads and ice roads,” he explains. “We got permission from the state to put a gravel pad next to the highway.”
The project has not been without its challenges, however. While flowing Alkaid-2, the company saw higher gas production volumes than expected and worked with SLB and other consultants to determine the cause. The company now believes that a frack intercepted a small gas cap at the extreme updip portion of the Alkaid anomaly, leading to the higher numbers. To avoid this from occurring again, lateral sections of future wells will be positioned deeper into the reservoir.
“Operationally, we had some sand blockages in the well bore, and that took longer than expected to clear out,” adds Rosenthal, noting that it was difficult to get the right equipment on site to perform the roughly ten-day cleanout process. “As a small operator that doesn’t have long-term contracts with rig service companies, we’ve had challenges with equipment availability on the North Slope. It’s something that we’re looking at ways to address in the future.”
Pantheon Resources
“With Theta West-1, we did a 10.5-mile step-out from Talitha-A to test the Lower Basin Floor Fan from an updip location, and we found 1,000 feet of light oil-bearing reservoir,” says Rosenthal.
The company provided its data to SLB, which put together a static model estimating that there were more than 17.8 billion barrels of oil in place across all the reservoirs on Pantheon leases, with a dynamic model showing approximately 10.9 billion barrels in place on the Theta West leases.
“Part of the plan—hopefully this year—is to use the same bore hole to do a test on the SMD, which is estimated to have a resource of about 400 million barrels sitting right above the Alkaid ZOI that we just tested,” says Rosenthal. “This will have huge implications for the development of the Alkaid Unit. If we have a successful test on the SMD, we will have an even larger volume development project sitting along the Dalton Highway. The size and location of the SMD oil resource would significantly enhance the commerciality of the oil in Alkaid ZOI.”
In 2023 and beyond, Pantheon also plans to drill and test a new Alkaid ZOI well, drill and test a new Theta West well, and drill and test a new Talitha well.
In March, Pantheon announced that it had added two new members to its team to further enhance its capabilities. The company named David Hobbs as an independent director to the board and hired Tony Beilman, a petroleum engineer with decades of engineering and operations experience, to improve and optimize operational performance.
Hobbs, who graduated as a petroleum engineer from Imperial College London in 1984, started his career as a drilling engineer at British Gas. He has also held commercial and business development roles at Monument Oil & Gas and Hardy Oil and Gas, and he served as chief energy strategist at Cambridge Energy Research Associates, advising senior executives, government officials, and boards of directors across the energy sector.
“There’s still a lot left to do, and we recognize that we’re a small team,” says Cheatham of the company’s aggressive plans for the coming year. “But we’re more than halfway up the summit. We’ve already gone a long way toward it.”