Ann: Quarterly Activities Report, page-21

Ha, sent the quarterly to Iain Esau, but wasn't expecting that headline. Cracker.



"Pancontinental Energy is in talks with supermajors and other players about them taking a stake in promising Petroleum Exploration Licence 87 in Namibia's Orange basin. In March, the Australian junior's stock price crashed after Woodside Energy’s decision to walk away from an optional farm-in opportunity covering PEL 87, despite Pancon claiming the Saturn complex could host 1.6 billion barrels of potential recoverable resources.

As a result, the operator quickly pressed the green light on reviving a competitive farm-out process. Pancon attended a major oil and gas event in Windhoek last week which, it said, "provided an excellent and timely forum to meet in person with the majority of parties that are participating in the farmout process," adding that it is engaged only with companies that have deepwater operational capability and a big balance sheet." The company is encouraged by the strong level of interest received from a combination of supermajors, large independents and national oil companies," it added. In addition to the farmout process, Pancon has engaged the services of a specialist in-country consultant to assist with pulling together an environmental impact assessment for a proposed drilling programme.

The Saturn complex is currently interpreted to host two main prospects and six leads, with two studies — basin modelling and seismic inversion — close to completion. Pancon said it is encouraged that the basin modelling study indicates a Kudu oil source kitchen immediately beneath and northeast of the Saturn complex. Based on regional well data, the company interprets the Kudu shale as being up to 300 metres thick and within the oil maturity window, while the fetch area that feeds into the Saturn complex is predicted to have generated and expelled some 20 billion barrels of oil. Pancon said another positive finding of its basin modelling study is that the gas-oil-ratio in PEL 87 is expected to be "substantially lower" than encountered at TotalEnergies' and Shell's discoveries to the south. The seismic inversion study aims to increase confidence in her licence's prospectivity by generating lithology (rock) and fluid prediction models.

Commenting on recent exploration wells drilled in the Orange basin — Galp's Mopane-3X discovery; Rhino's discoveries at Sagitarrius-1X and Capricornus-1X; and TotalEnergies' Marula-1X dry hole — Pancon argued these drilling results "support an emerging trend wherein both good quality sandstone reservoirs and hydrocarbon charge are present within an intra-slope setting along a north-south trending fairway inboard of the outer structural high." In layman's terms, the company appears to be suggesting that the sweet spot of Namibia's sector of the Orange basin appears to be in shallower waters — where PEL 87 is also situated — rather than in the ultradeep plays where TotalEnergies, Shell and Chevron operate. Pancon has a 75% stake in PEL 87 and is partnered by Custos Investments on 15% and Namcor on 10%."