Pantheon Resources Plc (PANR) Earnings Call Transcript & Summary

I turn on my camera. That will be the signal to IMC to start the meeting.

David, we can hear you, sir, and you are live. The floor is yours. Thank you.

Thank you very much indeed, and welcome all those online. Thank you for your patience. We got through this in 5 minutes rather than 7. The reason we're a bit later than we expected is simply because there are lots in the room that's somewhere less than 50, but more than 20, which is a standard lots as approved by the API. I'm delighted to introduce Max Easley, our new Chief Executive. To those of you who are not in the room, you'll just have to trust me when I say he's a fine outstanding fellow, and we're delighted to have him on Board. I'm not sure if you've seen him on webinars, on interviews with BlytheRay and others. So there's no need for us. And also Justin Hondris is here with us.

I'll let the video for you. He's not that much [indiscernible].

Unfortunately, they can't see the video. It's like the banana in the exhaust pipe. It was working. It didn't need to be, right. So we're going to move into the presentation, and I'm shortly going to hand over to Max. But first, please, would you read the disclaimer at your leisure afterwards rather than now, but it's important to recognize that this presentation comes with all the usual disclaimers. There is no information in this presentation that has not previously been released through the regulatory news service. But during the questions, we may be able to help you to understand it better. With that, Max, maybe I can pass it over to you.

Happy. I've been here 3 weeks now. It's great to be amongst you. I think most of you are familiar with this material. But this is me, presenting material is also what attracted me to the company in the first place was this material. In the first slide you see here is basically a grand summary of the business proposition that Pantheon represents. The first one, and I've been doing this for 33 years, and there's no adage in oil and gas that the company with the best rocks wins. So our starting point here is a 2.6 billion barrel opportunity. And it's probably beyond that, but that's certainly what we see today. And the more we explore, the more we're going to find. So we're very resource-rich. And it remains to be seen to the flow testing and the commerciality of this, but it's very hard for 2.6 billion barrels not to be commercial in this industry, especially when you're sitting on top of one of the best petroleum systems in the world on the north of Alaska. For the bulk of Alaska's industrial future, there's been a lot of headwind to oil and gas development despite it being one of the most world-class basins in the world. We find ourselves now with a lot of tailwind. That tailwind is occurring in the state of Alaska and also the federal government with red hats like that.

Lovely. Red hats likers.

Because Alaska is becoming a point of strategic interest, not only for resource extraction, but also for balance of trade for the United States with Asia. So again, the tailwinds are massive. The third one is Alaska is a very large place. The Arctic is a very cold place. I learned my trade on the North Slope of Alaska, so I can assure you, it is very cold and very remote. And one of the criticisms of Alaska is access to infrastructure. Infrastructure can be very expensive in remote locations in the Arctic. It just so happens where our fields are is right alongside, a, the highway conduit to the North Slope and the primary oil egress to Trans Alaska Pipeline. So you cannot be in a better geographic location on the North Slope than where we sit today. The biggest difference between what we're proposing as Pantheon and Alaska in the historic legacy development on the North Slope, North Slope is very, very capital intensive. You see pictures of giant [ sets ] of modules and billions of dollars invested upfront before you achieve first production. To the nature of our resource, we can do this in a modular fashion. So first production to first free cash flow generation is very, very short, which again is a huge advantage for the shareholders and makes financing much easier than would be. It was a large conventional development on the Arctic plane. Again, the balance of my entire career from day 1 in 1991 was when would gas be exported out of Alaska. There's about 9 Bcf a day of gas that goes around and around on the North Slope Alaska is reinjected into the reservoir. For most of the history of Alaska, it wasn't possible to have a gas export route because the principal asset on the North Slope is the Prudhoe Bay field and gas cap expansion is the primary reservoir mechanism for oil production. So if you say gas came too soon, you would lose more oil reserves than you would gain in gas revenue. So lots of pipe [indiscernible] early, but they were nonviable at first principle. You can't wait too long because for the gas export to be commercial, you have to have a viable oil business because of the North Slope cost structure. So Goldilocks can't have your [indiscernible] too cold, you can't have too hot. You need to just right. And we're in that window right now. We're not an Arctic plain producer. So we're going to be far south of that. So we could be the first entrant into that, and we have one huge advantage over North Slope producers, which is low CO2 content. The CO2 has lots of problems attached to it. And to have an export scheme off the North Slope of Alaska, you have to strip the CO2 out of the produced gas. In our case, we have a lot less, which made us a natural first entrant into the proposed gas plant in the state of Alaska, and we now have the Gas Precedent Agreement for 500 million a day to enable that to occur. And as in Alaska and one of the tailwinds associated with that is the Anchorage Southcentral Alaska Bold is efficient in natural gas. Historically, all the natural gas would come from Cook Inlet, the ocean just to the south of Anchorage. Those deals are heavily depleted now to the point they cannot meet the economic needs of Anchorage. Us being a sweet producer, no CO2, we can be the first mover to supply the domestic market to enable that gas line to occur, which is huge for the state of Alaska, which makes us very, very friendly with the government. Now I'd like to say the management team is really good, better all the time.

That was my line, if you remember because I was meant to. Okay. Yes. No, we -- Max obviously has joined us 3 weeks ago, and we were joking about when do you switch over from talking about how many days ago it was to being able to talk about weeks. And so we're at the weeks stage. Before we move on, I think it's well worth just saying a huge thank you to Jay Cheatham, who has been with us through thick and thin and has really shown the grit and determination to get the company to a point at which it's capable of attracting people of Max's caliber. Jay was a key part of the search team along with another member of the nonexecutive Board. And I can tell you that it was a unanimous decision that Max is the right candidate. So I can say with absolute confidence that Jay feels that he's handed on the reins to exactly the right person out of a potential group of extremely high-caliber people, honestly, any of whom would have been happy to have. So if hit negotiation too hard, but the truth is it's almost like the script was written to attract someone like Max. It matters being Alaskan. It matters having had experience operationally and commercially on the North Slope and that allows us to move to the next stage of development. But I hope if Jay, who I know is on the webinar, didn't hear it, let me just ask you to express your appreciation for him so he can hear us. Okay. And Jay, for your benefit, they only stopped because I signaled to stop so that we could keep moving through the presentation. It would have gone on. Much of what's covered here, I think Max covered in his introductory comments. So I'm going to move slowly through them to get to really the meat of the discussion. I think this illustrates the point about proximity to infrastructure and being away from many of the environmental issues and being on state land. And I know that one of the things that people have asked the question about is this new acreage to the east of us that was taken by Surprise Valley. We actually named Surprise Valley because like the Spanish inquisition, no one sees it coming. But the -- it's really an endorsement given that they paid twice as much as the minimum bid, it suggests that people are seeing more as a result of what we've been doing. And to be honest with you, we wish them and 88 Energy and anyone else in the region great success. It's not necessary that others should fail so that one person can win. In fact, we all benefit from a strong and robust activity set. Was there anything you wanted to add?

Just my usual analogy on this is I spent a lot of time in West Texas, so I learned the unconventional business. If you would have flown into West Texas 50 years ago, the first development you would have seen would be the Central Basin Platform, which was the original Permian set of reservoirs. Now when you fly to Midland, Texas, you start seeing development 200 miles west and east because the industry has expanded beyond the original reservoir and found enormous economic targets. Our Central Basin platform is that Arctic Plain, Prudhoe, Kuparuk, [ Indica ], et cetera, et cetera. And I would predict in 50 years' time, you'll start -- if you [indiscernible] Alaska, first thing you're going to see is us, but you'll probably see 200 miles of development just because we're sitting on an incredible petroleum system. Wherever you have incredible petroleum systems, development never stops.

And what you're seeing out to the east is Lagniappe, which is the Armstrong and Santos Apache joint venture. You're seeing further exploration happening to the west as well. So I suspect whether the scale would allow 200 miles in each direction before you run in to analyze it. But we'll certainly try and get a 100 miles.

As a reference, we have the ocean.

Yes, exactly. And you are all familiar with the resource estimates that have been produced, and we'll talk more about the Eastern portion and the Megrez well in a moment. And as you know, it's a stacked system, and that's what creates the resource density that gives us confidence in the commerciality and the continued development over decades to come, honestly. Maybe this is the point at which to hand over back to Max.

So Megrez-1, so a very successful exploration well at the tail end of last year and encountered a lot more pay than one would have expected.

Certainly more than we expected.

Telling how big of an optimist you are. Again, a lot of static hydrocarbon here top to bottom. The question is how commercial is it. So the first step to that is to do flow test on this well. So with core data, we have log data on paper, this is 1,400 feet or so stacked hydrocarbon. So we're now entering the well and the objective is to flow test 6 discrete zones, 1 at a time. So there's no ambiguity of each of these individuals. We have to go from the bottom up. So we'll do the lowest permeability ones first, and we'll complete the highest permeability zones last. Given this is incredibly important information for the market, for shareholders and ourselves, we're not going to wait until the end of the testing program to release results at each individual zone. After a 2-week flow period, we will give the results of each zone as we go. What you should expect is the rates getting bigger and bigger and bigger as we go because the nature of the reservoir properties improves as you go from the deepest part of the wells to the shallowest part of the well. And here they are.

Indeed, a lot of people have asked, why can't you tell us how much volume there is? And we've really put this here. You'll remember this slide because I know you all take our slides and commit them to memory. Roger Young presented this back in, I think, September before we drilled the well. And what it's really showing is that you can auto pick using the AVO, and you'll remember, Roger gave a quick teach-in. There will be an exam paper passed out in the room. And for those of you online, e-mail us and we'll send you the exam paper. But the point about it is that you can see that the resolution at the level of the top set 1 and below is very good resolution. But the frequency of the data, the angle of offset of the data, et cetera, means that once you get above that, it's really very hard to see. And don't forget, we're under the river. And so shooting seismic under a river is a challenge in its own right. So right now, what we've got is a team who are going hard at trying to see what we can extract. Now we know what we've got. What can we see and try and back rationalize, but it's going to take a while to have really good estimates. All we know and we announced, you'll remember in January that for the -- from the Prince Creek down, all of the zones there, we thought was about 15% to 50% more than our pre-drill estimate of 600-odd million barrels. I don't think that we are expecting it to be less than that when you add the next 3 zones on top of that. But if we are -- if we appear to be avoiding giving you a specific number, this is the slide that shows you. If any of you can interpret it and tell us what volume is there, we'll welcome your input. There are many who haven't needed to be asked to provide their input, and we thank them for that as well.

I've covered this one. I think we covered most of this already.

You've already covered most of it, I think, yes. I know there were some people who asked the question, where did this all come from? I'm going to say after this is all done and the story is written, the true heroes will be known. I can tell you that it's often said that success has many fathers and failure is an orphan. I can tell you that, that's absolutely true in this particular case that there are many people in a number of different organizations who came together to make this work. What's critical is that we've been able to provide something that Alaska needs that we are delighted to provide because it's good for us as well. And many of you have seen the headlines and the tailwinds to which Max was referring. It really is just a function of all these things coming together. And I can't remember which goal for it was. You said the more I practice, the luckier I get. The other side of that is that you'll get lots of opportunities during the course of a development of this nature. The skill of the management team and the reason no single person can do it is because it's recognizing the opportunity when it's coming bit new in the backside. And it really is a tribute to a number of people for recognizing that a number of factors would come together at the same time. And the critical realization was that we had sufficient resources at a quality that allowed the low-cost provision. So we were quite happy to treat on the basis that we did.

Okay. So quite a lot on this slide, I think you've looked at it. The most important, I think, a bit of color on your most people are interested in is the Ahpun FID because that is the beginning of cash flow generation for our company. From a petrotechnical point of view, this could be quite soon. Once you drill a commercial demonstration well, this was West Texas, you do a development well next day because permitting in West Texas is really 3 days to get a drill permit. In our case, because we are putting gravel pads onto the Tundra, we have to have various impact studies completed, which can be short or long. This is a long version here, which take 18 months plus. But there's a possibility this could be quite a bit shorter. So what we do in the meantime is, first of all, we're likely to delineate this Megrez well if we have oil top to bottom through the flow test because that could be a material resource for the company. And then we want to do a flow test long horizontal well. So we're not relying upon studies and analog that have a definitive commercial demonstration. Then there's a period of time while we're completing all the regulatory approvals. In that period of time, we can do further exploration, further testing. But really at that point, we're on the path to commerciality. And there is a gap, as you see here, between our first development and ostensibly when the gas line is in service. In that period of time, we will be injecting the gas back into the reservoir. Indeed, we will always maintain the ability to do that. It'd be like having 1 electric plug-in core to your field. If it gets unplugged, everything shuts down. So if there's ever a disruption to the gas line, we would want to shut down the field. So we always have that ability. But the most important thing here is the regulatory approval really is a critical path. We have increasing confidence in our resource base. Once we have a commercial evaluation of a horizontal well, we'll be extremely confident. And it's just a matter of getting everything aligned and the financing in hand to do our first major development.

And the reason that we're talking about the potential for it to be shorter is that the gravel footprint we require is about 1/10 of what's required further west. Now that's, again, luck, but you take the opportunities that arise. Someone already built a road from Deadhorse all the way down to Fairbanks. Someone built an airport in Deadhorse, whereas the development out to the West have to build their own roads and airports and stuff. So we just have the advantage of pre-existing infrastructure. That means that we could end up in a situation in which the Army Corps of Engineers agrees that there is no significant impact and can give us a shorter permit. But it would be foolish for us to plan and assume that, that was the case. So all of our planning is always done on a more conservative basis. Similarly, we assume there is no gas pipeline. All of our planning assumes no gas pipeline. Now I think there's been some confusion about gas injection wells. So let's just deal with that right up front. Max is quite right when he says we're going to have gas reinjection capacity for the full gas production no matter what because you don't want to shut down the oil export just because the gas pipeline trips. But that doesn't mean that we will always be drilling gas injection wells because if you do the math, it's simple. when the remaining oil in a production well is worth less than the cost of drilling a new gas injection well, you'll convert a well. So that's step 1. Step 2 is that the quality of reservoir we think we've encountered in the Megrez well suggests that we may be able to get away with far fewer gas injection wells because the permeabilities are high enough that we can potentially put away more gas with fewer wells. So that's a moving situation. Please don't treat it as axiomatic that we will either be drilling no wells because of the gas pipeline or wells forever. The truth is somewhere in between, and it's purely an economic and operational.

And we assume the most conservative case. So we don't overpromise.

Yes. What a fine-looking bunch of people those are. So let's finish off here and then take questions.

I'll leave the summary to the Chairman.

All right.

Right. Yes. So our contention, if we take as read because as indeed Max has said, a year ago, we're sitting at in round numbers, $250 million market capitalization. Why given the resources that we've got, would we be doing so? And a lot of legitimate questions and a lot of requirement for show me. What were the 2 things that people really wanted to see. The first was they were worried about excessive dilution that if it was -- I think we were very candid back in September of 2023, to get to cash flow self-sufficiency, we need to spend $300 million. I think a lot of people did the math and said, well, that's 70% to 90% dilution, why would I want to own those shares? And we explained that we would develop a strategy geared towards minimizing the extent of that dilution. That's the reason that a lot of management put money into the shares before dilution in order to burn the votes on the shores of Troy or maybe -- I don't know what the country was called, but Troy was definitely there somewhere. The end result is that we're aligned with you in seeking that path. We signed the Gas Sales Precedent Agreement which gave us visibility towards at least $250 million of project finance, and that's the reason that we were confident in our ability to limit potential dilution. Now obviously, we knew more at the point that we signed that in terms of the background conversation than probably shareholders did. So it took a while for people to move from seeing Gas Sales Precedent Agreement to connecting the dots as to how that might turn up as money. And thanks to the new administration, but also the old administration was pivotal in transferring the loan guarantees to the project. It was already pushing forward regardless of who's in power in Washington. And so I think we've demonstrated progress. There's more to do, but I think it's now clear to you all the shape of how we're going to fund the development on a go-forward basis. Second thing was to address skepticism about the quality of the reservoir and whether there really was an economic development that would underpin the initial infrastructure. Testing of the Megrez well, don't forget, September 2023, we didn't own the acreage that we've drilled this well on to. There are a lot of people who say, oh, gosh, strategy pivots. No, there's things that you do in the order you do them and you get the acreage first and you drill the well second rather than drill the well first and then apply to the acreage. I hope that's sort of self-explanatory. So I think that's moved the story forward quite considerably. Our contention would be that today, sitting at whatever it is, 67p at lunchtime anyway, that there is on a risk-reward basis, probably better value today to be had than a year ago. And I know looking at how much more relaxed a number of you look today than you did at the last Annual General Meeting, that's not a controversial assertion for me to be making. The -- don't worry, Richard, it will grow back. So the end result is we're set fair as long as we keep executing on the things we've been doing. A lot of what we've done over the last year, and Justin can attest to this, has been pretty unsexy. It's been about plumbing and getting to a point at which we had a credible story to tell. In the second half of the year last year, we began talking to new investors. And you can imagine, it's not the most appealing pitch to say, you're wrong about us, you need to be more optimistic. It's a lot easier to say, here's what's changed and here's why what you might have legitimately thought can be amended to what we think you should now be thinking. And so it's a process. And so I guarantee you, there will be times in the coming year when you will be as frustrated as you were in the last year. You will be as forthcoming with your advice on how we can address your concerns, and we welcome it all. And actually, I don't want to sound as if I'm being dismissive. It's exactly the opposite. We've had a lot of high-quality input from people. And what's absolutely critical to us is that we continue to receive the authentic voice of the market because it would be easy if you start telling us what you think we want to hear or we've got a pretty good idea of what we want to hear. So you're never going to be as good at telling us what we want to hear as we are. Much better for you to tell us what you really think. And so please don't hesitate to continue doing so. I would ask as the number of shareholders and as the scale of the operation moves up to use the [email protected] because it's much easier for us to take a good question and transmit it broadly by adding it to the Q&A page on the website than to run the risk of an accidental selective disclosure by talking to people individually, much better for us to police it by providing one answer to all than to try and answer everyone at the same time. So it doesn't mean that Justin no longer loves you if he says, could you put it on an e-mail so that we can provide an answer to everyone. It's actually -- it's going to be required. If we become a U.S.-listed company, it's going to be required as a process for regulatory compliance. And so why don't we start practicing today on that. Now with that, we're then going to break that rule and answer questions that have been asked without posting the answers to the Q&A. There'll be some very general ones, I'm sure come out of this. But if we kick through some of the questions that were pre-addressed, at the same time, if you've got a question that you think is better than the ones that people sent to us beforehand, then put your hand up and we'll capture people in the room just as much as we capture the people who pre-submitted questions. But Ezra, you can't put your hand up because I think some of these questions came from you.

So the first question was, can Pantheon benefit from any government federal or state funding given the pipeline is in the best interest of the state and the Pantheon is agreeing to give them gas at below market rates? Max, maybe you can speak to that particular question.

It'd be unlikely to have a direct investment from the state. They've never done that in the past. So I can't imagine them being a working interest owner, for example, in our assets. But as the question suggests, it is in the best interest of the state. And our relationship with the state is very founded on mutual advantage. I mean entering into agreements with the state allows for advanced financing. They can backstop some of that and things like that. They're going to do whatever it takes to make this attractive to us because it's attractive to them. But I would not see any direct contribution from the state to be an owner of the company.

And quite specifically, in terms of federal funding, the relevant legislation makes it very clear. It's infrastructure, not production. And that's not a surprise because the returns for upstream investment are appreciably higher, whereas regulated assets have a limited rate of return, and therefore, cost of funding is critical to that going forward. The funding requirements to key milestones, no change in our guidance. Our estimate is broadly $150 million. And you remember at the time we gave this guidance, it was $150 million. I think at the time -- I think we said plus or minus $150 million, although I doubt it was minus $150 million. The point being, this is to 1.5 significant figures on that. To get to cash flow self-sufficiency, we still think it's about $300 million. Success in Megrez might reduce that, but marginally rather than at a gross level. And so we are still developing a capital stack that will provide the $300 million we need. You'll have seen that we just raised $35 million from Sun Hung Kai. That's been tremendously helpful and certainly counts towards that $150 million that we've talked about. In fact, it leaves us in a position depending on how closely we want to squeak to be able to drill the next well in any case. So we're funded in a very strong position as things stand right now. And I can imagine circumstances in which we can complete our program from where we are today without having to come back to the market. That is really a question then of the value of acceleration. Can we do some things quicker that would bring value forward? And that's a decision. It's great to have the opportunity to make a decision based on what would be nice rather than what would be essential. How much money do we have on hand? Actually, there's a simple answer to that, which is we will be publishing our midyear results in the relatively near future. But we are -- you can probably do the math on the basis of what we last announced, how much money we've raised since and how much we spent. The answer is plenty. That's the reason that with the addition of $35 million, I can confidently say that we're funded going forward. What Pantheon's plans for future funding? I think we sort of covered that. What are U.S. investment banks tasked with doing for Pantheon? The answer is to advise us on potential strategic transactions that would lead to sufficient funding to fulfill our entire program. And in the event we move forward and the timing of moving forward, our intention is definitely to move forward to listing on a senior U.S. exchange. But the only commitment to the banks is that they would probably be a part of the team if we all agree -- if they want to work with us and we want to work with them. But for the short term, they're working on strategic funding initiatives. I don't think we're going to get into the details of the plans for specifics on how we're funding different activities, what the state of play with Heights and they've gone -- we made it very clear in the announcement that we would hold the money to pay Heights in cash as our backstop arrangement. So not -- I don't want to get too specific on speculating on things that are ongoing. So maybe, Max, if I can turn over the questions on Megrez to you.

The answer is almost all of these questions are -- as part of the RNS we issued. But in summary, the timing kind of starts now. So we've already entered the well as we indicated we would in mid-March. And so based on operational factors over the next 2 months, we'll be completing testing and get bottom up. And as I mentioned, every individual zone will be released as they occur rather than waiting until the end. The flow rates were in the release. We said 200 to 2,000 deeper to shallow. We shall see. You may see some lower than that, I doubt it. You may see some quite a bit higher than that because it was all based on analog and every reservoir is different. We'll certainly release those as they occur. We indicated the deepest horizon, there was no economic benefit to doing that right now, Topset 3. We have a whole core in that interval. We understand the reservoir properties. It wasn't a good use of shareholder funds to test that one.

We'd still drill development wells into it. It's not that Topstep 3 is gone. It is just there was no point in spending money to learn very little incremental information that we couldn't learn from a development well in it.

I'll read the questions out. Yes. Why do you not core the entire horizon? Always tricky you drill an exploration well. Do you know you're going to find before you find it? So we don't have a full core in the entire reservoir, but we found lots of oil. And in retrospect, I think we really should have acquired that. But until you discover the oil, it's hard to make that decision.

It is easier to pick coring points with the benefit of having the logs and all the cutting...

If this reservoir lives up to the potential we think it may, there will be a whole core taking this for development decisions in the future. But the key to this well is it's a major discovery. And so we have all the log data that tells us what we need to know for now and the flow test will confirm that here in coming weeks.

I think how to compare with Pikka and Willow, we've issued on the website a table. My guess is this question was submitted by someone who didn't realize there was a Q&A section on the website, but we've tabulated from public data sources, including the Department of Oil and Gas. So you can see what the range of potential outcomes is of the gas?

We'll see.

Yes. So yes, the question is, will the gas in Megrez be low carbon dioxide and therefore, able to -- until we've got flow tests apparently, how can we not know if VAS was part of the logging suite at Megrez-1. The answer is there are lots of ways in which we cannot know, not least of which is that that's not what VAS would be telling us. What it's telling us is that we've got good hydrocarbon saturation.

And what is the cost to drill a delineation well? It depends on the scope of the well. We drill a vertical well, be a lot cheaper than a deviated well, but rule of thumb [indiscernible].

Okay. What are the plans operationally beyond Megrez-1? And does success or failure at Megrez determine what well you'll drill next?

Yes, is the answer to that.

Simple answer.

Yes. Again, as I mentioned earlier, we have 2 objectives from here in the near term. One is to delineate this discovery if the flow test is successful; and two, is a commercial demonstration well in a low firm horizon to demonstrate the commerciality of our first development. So that's what will drive us in the near term.

Short-term drilling at Theta West near the Chimney, let me turn that into how the company terminology would cover it, which is, will we drill a Kodiak appraisal well up dip to the North and West? The answer is yes, but the timing of that is not critical to the development decisions and the development planning we have to take. And so that will be a target of opportunity depending on how our funding stack begins to shake out rather than something that we need to do in the immediate short term.

And the question, is there a traction? The answer to that is yes.

But it needs some context for that. So on the question about do we need to drill any more wells for the Alaska LNG Phase 1 gas pipeline to proceed? The answer to that is it depends, but probably yes. And the reason for that is that if we think about what we would have to risk versus the reward to make a decision to proceed with Ahpun development, we're talking about $150 million at risk before you know whether or not you made a good decision. And we're already better than 90% confident in that regard. So drilling an additional appraisal well purely for development planning that might move you from 90% certain to 93% or 95% certain, that's a harder sell in terms of risk -- money to risk for that degree of improvement. On the back of having to spend $10 billion or $11 billion on a gas pipeline. The extra -- the value of being 3% or 5% more certain is considerably higher. And so there will be discussions as we finalize the gas sales agreement about what level of certainty is required for financing of the gas pipeline, and that will be what dictates the necessity to drill it. Do we want to drill an additional appraisal well to demonstrate producibility? Absolutely, and that's the reason you saw it on the development time line as a potential well that we would consider. Without cores?

So without cores, how can we be confident of flowing oil in the shallow horizon? Well, we're going to flow test it. If we had chosen not to flow test it, that would have been a serious question. If we just determined it was commercial. In this case, we are going to flow it. The cores are very, very helpful for direct measurement of reservoir properties. So if you go to an ultimate field development, you want to have detailed information on the reservoir properties. We have enough log properties here to demonstrate why we would flow test it, and that's why we're choosing to flow test it.

And does our estimate of 15% to 50% increase [indiscernible]. I think we were very clear that our guidance wasn't changed for everything from the Prince Creek down. That guidance still applies, and we expect addition from the upper zones if they flow test successfully along the way. Who is Surprise Valley? If you are Surprise Valley, put your hand up. Apparently, no one here is Surprise Valley. The -- we talked a little bit about the ability to accelerate the process, and it's really -- the critical part is more regulatory than anything else. If we had $1 billion today, we probably couldn't bring it on production any quicker because you'd still got to go through the regulatory process. I think we described in the presentation why we've modeled an EIS rather than EA. Do we -- President Trump made a difference? This all sounds [indiscernible] the question. Are we confident? We think that the odds of the pipeline moving forward are higher today than they were before, but we were already pretty confident that it was moving forward. That's the reason that we've invested the time and effort in finding a mutually beneficial deal with Alaska.

Do you want to take...

We understand your gas needs pipeline specifications. For those of you not in the room, Max has had to put on his glasses. He's human like the rest of us.

His question is, we understand your gas needs pipeline specs, while other projects do not. What advantage this provide in practical terms where you don't have to extract the CO2 before we export it. Just put in the context, the proposed CO2 stripping infrastructure on North Slope is a $10 billion project. Ours would not be that scale, but it's a huge advantage for us commercially not to have to extract CO2 amine systems or other mechanisms to export our gas. That's a huge advantage.

We've already addressed the question about investment banking advisers. There's a question about whether BP's strategy pivot means that there was someone speculating that Max, you coming on board as CEO was all part of a free choreograph move to have BP gloriously return to Alaska. I would say that's a better question for the BP AGM rather than our AGM.

And I'll dispel that rumor right now. I was at BP some time ago.

The -- when do we intend to report results? You've talked about that already. Governor Dunleavy has suggested the pipeline could be operational 2 years after construction begins. I think that this is a question better put to Governor Dunleavy. The -- Will AGDC, Glenfarne and Alaska Utilities demand Pantheon drill production wells? The answer is yes. If we sign a gas sales contract, we will be committing to drill production wells on that.

So that includes question of -- the question about [indiscernible] hitting volumes.

Yes. I mean we will have gas -- when the gas pipeline comes on stream, it's going to need between 100 and 200 initially. Each well that we drill will probably produce around 10 million cubic feet of gas per day. I mean this is an old number from last year. We talked about and nothing would convince us in the absence of information to the contrary that, that wasn't still the case. So we will have plenty of gas deliverability for the initial ramp-up.

If that question is posed as a risk, that's really an upside question. Because right now, there's a number of years we would be injecting gas from the reservoir. If indeed, that pipeline came a bit sooner, it's more capital efficient for us.

And just to be clear, we are as keen as the state of Alaska and others to move things as quickly as they can without cutting corners. If you know the questions you're wishing you'd asked, Ezra. Go ahead.

What you see is the key risk to your geological [indiscernible] .

Yes. No, I will, yes. So the question was what do we think are the key geological risks to our interpretation that would result in an adverse outcome. And the good news is you've got no geologists here. So any answer that we give is going to be preconditioned by saying there are no geologists here. Max?

That's a great question. At this stage, reservoir quality is what we're trying to derisk here. And both in terms of geologic structure as well as reservoir petroleum engineering be the one which we represent. That's what we're going to do the test. There's an enormous amount of drilling inventory here. So if this was 10,000 acres as [indiscernible] and we had 50 wells to drill, that would be a very significant risk. That our inventory is so vast that if you want to break this into Tier 1, Tier 2, Tier 3 based on reservoir quality, your grandchildren are probably the ones worried about the Tier 3 inventory. So upfront, based on all the data we have, the reservoir parameters are such that our type curve is triple, 4x, 5x the Permian analog. That's what we're going to be testing with the commercial evaluation. But there is old saying in the United States, there's a reason they play the games on Sunday because on paper, you can come to conclusions. So we're going to learn a tremendous amount when we do this test. It's not just a stand-alone well, there's a question coming up about how you drive innovation into the development plan. So for any reservoir quality you encounter, there's a very capital-efficient way to develop that and a very capital inefficient way to do that. And our mission is to get to the most capital efficient as soon as possible. It wasn't that long ago. I'm going to opine for a minute.

Yes, it wasn't that long ago. I don't know if I was just saying by name in an AGM that a significant CEO of a very significant company said that oil will never be commercial in Shale.

Shale, not Shell, just for the avoidance of doubt.

Yes, Shell is not relevant here. In U.S. it's there is there to where we are right now inside reservoirs over a couple of decades is unbelievable. And the face of learning has been unbelievable to get to that. We at Pantheon are not going to start from day 1 of the learnings in the unconventional world. We're going to capitalize on all of that. And for me as an individual, that was the attraction to Pantheon, having done this in the Permian and the Montney in Canada, we have to learn now over again how to get the most capital-efficient development out of our reservoir. I'd like to think that was the attraction of Pantheon to me.

It was your pruning good look more than anything else. That really is the question. Look, it really was. We had a template of what the right candidate looked like. And having experience in the unconventional field in terms of assembling logistics and supply chains, we cannot rely upon the goodwill of others to cut us a break on the North Slope. What we need is people who've shown ruthless execution. You remember, there was a time before I joined Pantheon when I talked about what shareholders want is less a plucky upstart taking on the world and more a bit of [ Vorsprung durch Technik] although now the German automotive industry means I probably want to quote the [ bog ] and say resistance is brutal. But I mean, we need to overmatch ourselves against the job at hand. And part of the attraction of Max was having done it at Apache or now APA Corporation, about to call them Apache. They were among the most capital efficient in the Permian Basin at PETRONAS up in the Devonia shale and the Montney -- actually was in the Montney. But the shales up there meant that we knew he could do it in the cold. So it's not a big step to assume that an Alaskan who's used to doing it in the warm and the cold can do it on the North Slope. And so that was a big part of why we were delighted that we could get.

That's a foundational question. I remember the geology always matters. In Permian, Eagle Ford, Bakken, you would hear companies say we've cracked the code in the Wolfcamp Shale [ to 65 spacing ] with these completions. Either they don't know anything about geology or they're misleading the market. In our case, regardless of what geologic diversity we encounter, the mission will be what's the most capital-efficient way to drill that to maximize value for the shareholders. And the sooner you get to those conclusions, the better. I call it the secret sauce, which is for any bit of geology regardless of its properties, what's the right density of wells and what's the scale of the completion. If you get one of those wrong, you're less than optimal on capital efficiency. And so that is the mission for us now as we pivot to commerciality is how do we make this most capital-efficient development we can.

And it's nice to start with rock that in our worst rock is about 100x better than the Permian Basin. And in our best case is another 2 orders of magnitude better.

Yes. I think the latter is more important one. Is it commercial is one question. The second one is how do you make it the most capital efficient? I think bucket 2 is what's going to be driving us.

Here. That's for sure.

Other questions in the room?

It's a great question.

Yes.

David and Max. Just looking at the Megrez-1 result. When we looked at the Topsets, we were expecting basically conventional reservoir properties [indiscernible] get your views on why that was and obviously a bit more confidence about commerciality in shales. I don't know there's [indiscernible].

Well, I can tell you what the geologists have told us. And again, with the pre-understanding that if I gobble it, we'll let a real geologist reanswer the question properly. But it is that it would appear that the depth of burial of those lower Topsets is greater than we'd expect. And there are a couple of large [indiscernible] that you could obviously see on that seismic line I showed you. The -- and if you couldn't, don't worry, you're not alone. But it looks as if probably those -- the upper Schrader Bluff was probably buried a bit deeper than the predrill model would have suggested. Other explanations are possible. In terms of why are we confident about the shallower zones having better quality properties, that's because we've logged it and we've got some cores, decidable cores up into those shallower zones and because we've got a variety of different logs that in aggregate would lead to that conclusion. But the proof is in the pudding. It's the testing will demonstrate it. But I can tell you that all of the scientific data is pointing to that result. It's always much easier to tell the rock properties after you've drilled it than before. If a geologist had his way, what you do is say, give me the money, I'm not going to tell you what you get for it, but I'll tell you after what you did get for it. Unfortunately, that's not how the real world works. And so you have to take the risk of being wrong. In this case, the geologists were horrifically wrong because they missed 5 additional zones above the one, and I mean horrifically wrong in the best possible way. We'll take that kind of mistake every day.

This may be too basic if this, I apologize. But to find a conventional reservoir like those [ Sagavanirtok ], 5 things are required. A source rock. We have no shortage of source rocks around here, a transmission path, which we can see, a structure, which we have in a feel, that was the real question. And the last one is the reservoir capable of commercial quantities. We believe so. So all 5 of those seem to have been in place here. But we have flow test to make certain of that. But it looks like all 5 of those occurred and we have a potential reservoir. But early prognosis is perceived to me, but 1 of those 5 probably seal was the issue. And there was a penetration above us historically by a different operator that fell short of our horizon and it was wide away. And so that paradigm probably was applied to these [indiscernible] which turned out not to be the case.

And the reason we showed you that slide is the data is pretty equivocal above the Topset 1. So it's a risk until you put a well.

That's great to assume a seal based on that assignment.

Yes, exactly. Exactly.

Yes, there and then we'll come to the front.

Let's say [indiscernible] we may or may not be commercial but move forward on this [indiscernible] increasing commercial.

Well, I wouldn't say even the first part of that prediction is right. We predict that every zone we test is going to demonstrate commercial potential. And indeed, Tier 3, which we're not testing, we believe based on what we've got, if you put a horizontal well in it with multistage frac, we believe that would deliver economically attractive returns on developing that as well.

And so what you see the consequence of that as you get [indiscernible].

Well, we'll have increasingly economically attractive reservoirs to develop is the consequence of that. Now does that mean -- and I think we sort of addressed it in the press release that the -- if you move from a reservoir that is of a quality that you develop using primary depletion drive only, that's the simplest possible well you can have, you literally put a straw in it and suck or let it blow. If you move into a higher quality reservoir, then you're starting to get water floods, potential gas pressure maintenance, et cetera. And that requires a lot more science to understand the optimal way of doing it. That requires a lot more appraisal. I don't know from your experience, what would you?

The unconventional or tight reservoirs, primary completion as David suggests, you can develop piecemeal. Because the reservoir doesn't talk across miles and miles and miles.

Every well has its own field.

Basically. When you get to large conventional fields, you have to develop it as a field because you're conserving the reserves of the entire pool. And that's why you would need delineation wells, appraisal wells, maybe early waterflood and things like that. This will be a really nice problem to have, having a large conventional pool, we'll have to evaluate the capital intensity and value of that as opposed to early production in the primary and what order we do those in to maximize value for all of you. Again, it's a nice problem to have choosing between 2 commercial pursuits and which one makes the most sense temporarily as well as quality.

So I'm going to offer the Bill Belichick answer, which is that how we move forward will be what we believe to be in the best interest of shareholders and the company, but I'm not going to make predictions about who will be our starting cornerback for the next reservoir. Steve?

Yes, [indiscernible] terms of scenarios you're looking at scenarios where it's shorter and longer than that and basically planning the capital opportunities around that being fair.

So the question for those not in the room. No, no. That's fine. I follow-up. You know...

[indiscernible]

So, yes, I'll come back to describing how that happens. But the question for everyone's benefit was depending on whether it's an environmental assessment or an environmental impact statement and whether the results of it are challenged leads to a range of potential timings for getting the approvals that would allow us to proceed. And so yes, we are planning our program to be resilient to any of those outcomes. Clearly, it's easier to be resilient to a shorter outcome than a longer outcome, as you'd expect. The -- in a second, I'm going to hand it over to Max to talk about what are some of the nonregulatory lead times that you have to consider. But in terms of the process, so what we do is we're gathering a lot of the data and preparing what we describe as sort of an environmental report for look forward for a better description. It's aggregating the data in such a way as to help the regulatory body, in this case, the Army Corps of Engineers to be able to begin their assessment as quickly as possible. So when we talk about we've begun the process, it's not that the firing -- the starting gun at the Corps of Engineers has been fired. It is that we're doing a lot of the work that allows them to do their work in the most efficient possible way. And so we anticipate during the course of this year and probably before the end of the year -- comfortably before the end of the year to have provided enough information in terms of the layout of our planned development, where the gravel pads would be, how big they're going to be, how many pipe supports are needed, and therefore, how much impact on the Tundra, et cetera. That's all the data we need to provide to them and then for them to start doing their work. In terms of nonregulatory lead times, it's really in the same bucket as capital efficiency. What wells you drill and how you complete them is one part of it. The cost of services is something else. We cannot rely upon the traditional North Slope supply chains for this. There are no long horizontal wells with these sort of orthogonal fracs that occur. So we have to build a supply chain for this, enormous quality -- quantities of sand and water, and we want to develop our own supply chain purpose-built for this. So we're not in direct competition for services for the North Slope producers. That does not happen overnight, and that is the absolute key to managing your capital efficiency is not allowing escalating service costs. So we have a lot of relationships and contractual arrangements to be created with the right suppliers. And in my experience, having done this for a decade, most of the services are not commoditized. A lot of the innovation that occurs in drilling faster or completing more efficiently, you do in concert with the suppliers because they're the ones doing the execution. So we have to pick our partners, so to speak, very careful here. So we're in long-term relationships as mutual advantage and innovation because as much innovation will come from them as from us. And that takes some time to do that. So we can't just do that overnight. So over the next year, 18 months, we'll build those out. So when we come to executing at scale, we have the supply chain that can make that occur. And in start-up, there's a bit of a trade-off between finding the lowest cost provider versus time. And so using -- there are scenarios in which if we were able to start up sooner than capital purchases could be made, we can lease flow units and that sort of thing. So it is a multivariable equation. And we will -- as coach, Belichick, would say, we will try to make the decisions that put the team in the best possible position to win.

What underpins all of that is the operating efficiency and capital efficiency to generate free cash flow, not just the horse ground.

Yes. Go ahead there, and then I'll go back to Gary.

I've got a question in relation to the listing of the company's shares. I'm a private shareholder. I've been a shareholder for 6 or 7 years. And one of the reasons, a factor in my becoming a shareholder [indiscernible] but if it's one of the flag that you are looking at a listing in the United States on one of the major exchanges, which not asking you for an answer, but would the benefits of being a named listed shareholder leave us or could there be some element of a dual listing whereby the advantage is for somebody in my situation.

So I think you're referring to the inheritance tax break on AIM listed shares. And so the bad news and there's a facetious answer one could make, which is it doesn't benefit the shareholder in any way because for the benefit to be accrued, they must have died, and I wouldn't wish that on anyone. So having put that to one side, the current government has removed half of that benefit. And I'm not in the business of trying to predict what they will do with the other half, but they haven't shown themselves to be terribly sympathetic towards people nearing the end of their lives. Secondly, it is far from guaranteed that even if there were no change in the legislation that the shares would receive that inheritance tax relief because the revenue has been very clear that they won't tell you beforehand whether it does. They will tell you that it might, but it will depend upon the circumstances as they exist at the time. And therefore, that is a second risk factor to whether or not the inheritance tax is available. The third factor, which is, in a sense, more important is I think the legislation is very clear that if you're listed on a senior exchange, then immediately you have a listing on a senior exchange, the same benefit disappears. So the judgment we have to make and will make but haven't made yet is, is it in the best interest of the company and its shareholders to go to a U.S. exchange. The answer is it may well be because if it exposes the company to a larger pool of capital, and I'm just going to make up numbers here. But if the analysis was that we believe that it will double the value of the shares because of the greater liquidity available, and you could make that argument based on relative ratings of companies between those 2 markets, that is a good deal more than the inheritance tax saving, assuming that -- I mean, we hope that our shares will do it well enough that every one of you is in the 2 million-plus estate bracket so that it's maximum inheritance tax. And if you don't own enough shares to reach that, then buy some more today. Am I allowed to say that, Charlie? I'm not apparently, Charlie is looking at me, this is our Nomad. He's looking at me in a way that says you shouldn't all through have said that, so I take it all back. You make your own decisions about whether you should buy shares. Yes, but that's the simple answer. And then just to finish that, and sorry, I'll come -- I've got Gary and then you too. The -- in terms of transitional arrangements, what we want to make sure is that there is no shareholder who is unreasonably inconvenienced by the decisions we make for the benefit of all shareholders. We are not going to make a promise that no individual shareholder will be disadvantaged because you will all have different personal circumstances. We will, however, be cognizant of who our shareholders are and what drives them. That's why, again, as I said earlier, and I meant it sincerely, and I hope you can take it sincerely. We need to hear the true voice of the shareholder and the true voice of the market in order to make sure that there isn't a perspective that we're missing on that. But we will absolutely be solicitors of that. Gary?

Yes. I got some concern about the commerciality of our unconventional [indiscernible] how from some of the mentioned before corporate present breakeven. So unconventional people are that it can actually be just as profitable as the convention.

So the question for people on the webinar was how does our tighter reservoir. I think we've tried to avoid talking about it as shale. How does that stack up against other plays when you're benchmarking commerciality, when you're benchmarking breakevens, et cetera. The -- now -- so the first thing is there is a technical definition, Max, over to you on conventional versus unconventional.

The technical answer for an unconventional is the hydrocarbons were formed in situ in the rocking question. So there's a shallow marine system and it became a shale. It was formed there, never moved. That's really what unconventional means. People use it more generically for any reservoir that you develop but the primary depletion was on horizontal wells with orthogonal fracs. But there's a big range between a nano-darcy shale in the Wolfcamp and what we're seeing here, several orders of magnitude more permeability. We're choosing to develop it in the same manner, but the reservoir is massively higher quality than it has been proven commercial in West Texas and other places. And that's why we're doing the commerciality test, of course, of the demonstration well. But the general rule of thumb is every well is twice as expensive and the reserves are triple. But if you do that math, you get to a very commercial development pretty quick.

I get the point. Our breakeven [indiscernible] associate with, shield that breakeven to rather...

Look, we absolutely -- we have not published formal guidance on breakevens partly because there are a number of assumptions that have to go into that. But what we've talked about in the past has been breakevens that are better than for the more remote North Slope developments and are certainly considerably better than in the 4 major basins, the super basins for oil in the Lower 48. We're not in a position to give specific guidance at this point on what that is. But we -- I know that a few years back, we showed where it stood in the cost stack and nothing much has changed. We are certainly not the marginal producer of tight oil in North America.

My understanding on Jeffrey's question [indiscernible].

No, I'm not going to -- so the question was, did the AIM benefit on IHT apply to oil companies. That is specifically the point I was trying to make when I said it is not guaranteed that it would because the revenue will not provide guidance but says it doesn't. What they say is we will assess every case on the facts at the time and that they -- in the same way as I think they did eventually rule that wine storage schemes didn't benefit from IHT and that -- so again, I don't know enough about the differences between oil production and wine storage or at least I know a bit, but not enough to -- the bit I'm not clear on is wine storage. I tend to store it here, but that's an entirely different question. So yes, I would -- I sometimes wonder whether the AIM benefit. I hope that even if you came to Pantheon in order to protect your as that you'll stay for the quality of the business that we're going to develop. Where is it that they say we hope to come to somewhere in the Caribbean for the beaches, but you'll stay for the hospitality along the way. Yes, far away.

This is a question about pipeline [indiscernible]. Is it possible that the Phase 1 of the pipeline can proceed without Phase 2.

Yes, yes. So the question was, is Phase 1 of the Alaska LNG project, which is the pipeline on its own, viable without Phase 2, which is LNG export and carbon dioxide removal at the top. The answer is absolutely, yes, that's what the WoodMac report found. It found that the economic benefit of doing that compared to importing LNG was a no-brainer and that's without incorporating the additional value and the option on additional value that having the pipeline would provide.

Talk about exports, there's nothing [indiscernible].

That's exactly right. Look, I know there are some shareholders who've been unafraid to tell us that we should be asking Mr. Trump to say that without Pantheon, none of this would happen. Our view is that, firstly, no one tells Mr. Trump what to say. Nobody sits baby in the corner. I think for those of you old enough to remember footless or foot loose, the -- number one. Number two, there's an awful lot -- or was it dirty dancing? Sorry. You know what, I love the fact that we've got shareholders who are more focused on my being wrong about foot loose versus dirty dancing than on the viability of the pipeline. You know who you are. Anyway, the point about it is that there is an awful lot more that we can achieve that will benefit shareholders by not being out front in the public domain on this. And to be honest with you, I said at the start, this is going to be the result of many people putting in an awful lot of effort to do an awful lot of things. And one thing that will absolutely guarantee to upset the Apple cart is if people start arguing about credit before you've got something to take credit for. And so we will allow the people who need to do their jobs to do their jobs. We will support them in whatever way we can, and we will try to make sure that the outcome is good for Pantheon shareholders, good for the state of Alaska and good for the consumers of Alaska. And if you don't hear a lot more about how we're involved in it, then you'll just have to accept that there are good reasons for that. Incidentally, I think that Senators Murkowski and Sullivan are well aware of the Twitter handles of many of Pantheon shareholders because they have seen them cropping up. You don't need to worry about whether they know who you are on the basis that occasionally, we've been asked.

[indiscernible] U.S. market doesn't have any preproduction well companies on the market. So it might make sense to not rush to the U.S. IPO or at least wait until companies finish its production and has less risk of the market misunderstanding the country story?

I would say that we have a number of high-quality professional advisers from a number of different areas, and we will assess the advice and the Board will take a decision as the great coach, Bill Belichick, would say that gives the company the best opportunity to win.

Any other questions?

We should probably quickly check whether there are a lot of -- I forgot that...

There was online.

Yes, there are some online. Question for incoming CEO, Max Easley. Do you believe that CEO should have real skin in the game, not just one-sided option grant, but actually buying shares? Okay. We don't have to read the rest of that question. I can tell you that there has -- and it's a fair question, and I'm not going to put Max on the spot to answer a question. I don't think anyone's employment should be conditional on their personal financial circumstances. What we should do is employ the person who is best able to deliver value for shareholders. The -- as a matter of fact, there has not been effectively an open regulatory window since Max joined to be able to even have that discussion, let alone to actually even grant him options. Hence, the press release talked about the desire to grant options rather than that we had granted options. When are we back on the rig? I think that's been answered. I'm not going to answer a question about the outside diameter of the completion. We know who's asked that question. No, it wasn't. It was not [indiscernible], someone else we know who it was. What's with the baseball cap? Hang on a second. What we seen on video. These were make Pantheon great again hats, which are grateful shareholder, well, I'm assuming grateful. Maybe if you don't like them, you'll think differently. The -- what else have we got? When are volumetric evaluations expected? I think look we will be integrating a lot of data from the test. One of the key variables is actually the fluid composition. So we'll need to get that.

Due course.

Yes. Why are we not getting -- well, we've sort of answered questions about press coverage and that sort of thing. I'm right. So somebody has asked, given previous operations suffered significant delays due to errors, how likely is completing 4 months of flow tests? Do you have the money to fix the well when operations screw up? Thank you.

Thank you for your support.

Nobody in fairness, the person asking it has a long track record of having asked that question publicly. The -- and so what I can say is we have planned meticulously to try and avoid any kind of a screw up. We have managed to deliver the well to date at below budget and within the time frame. We delivered the reentry and recompletion of the Alkaid 2 well, again, without incident. And we have Tony Beilman and the team supporting him a very capable operations group. But as I said earlier, we definitely have the money to complete the well even if we accepted the premise that we were going to screw up. Can we comment on the probability that Megrez becomes the next Prudhoe Bay?

I would say 0. Prudhoe Bay is 15 billion barrels and 27 keys, would be an extreme outcome. We'd be extremely happy if we were just a baby Prudhoe Bay.

Yes. Is the endgame a corporate sale or long-term production? The answer to that, you'll remember that there is no way that you can have a strategy that relies upon a sale of the company if you don't have a valid alternative. The strategy pivot of nearly 2 years ago was to say we need to create a credible hold case for this. And if someone comes along and makes an offer at some point along the line, it will need to be of a value that it is better for shareholders to accept than to continue to hold. I will quote the great Bill Belichick once more. We will try to make sure that we put the team in the best possible position to win by having a credible backstop of hold so that if -- and only if someone offers a price that it is better for the team to accept, will we be prepared to accept. But just to put this in context, our expectation, you'll remember some time back, we talked about where we saw this growing to. We see it growing to around 300,000 barrels a day. That's what we've got in our minds as the target we're trying to get to. That's about the same size that Pioneer Natural Resources was when ExxonMobil bought it. There comes a point at which the scale becomes irresistible to someone with a need to fill a production growth. just as Pioneer had a valid future as a growing Tier 1 Permian Basin producer, we intend to have a valid future as a growing Tier 1 North Slope producer. But we can't say no to the possibility that someone would eventually want to offer a lot of money. That's not our plan. Our plan is to build a serious oil company that will be in shareholders' best interest. I can't talk about target market caps. The -- where else can we -- can we clarify how the test started? We have reentered the well, I think, is what you said. We haven't started testing. you know there are quite a lot of questions. I think what we're going to do is there are some of these questions that it will be easier for us to aggregate them and answer them at Q&A on the website rather than keeping everyone online or in the room forever. I'm going to leave it to one last question. Well, I'm going to answer one question and then leave it with one last question. So guidance on a U.S. listing to a senior exchange, the answer is we will move that forward. We talked about the earliest we could do it was going to be in the middle of this year with Megrez success and the fact that testing is going to take an awful lot longer than originally had been contemplated. I think it's a fair bet to say that we're not going to be in the middle of the year, but we will move forward. We put ourselves in a position where we could do it. We've built the systems. We've got the restatement of IFRS accounts to U.S. GAAP, et cetera. The precise timing will be a function of the advice of the many professional advisers that we've got working with us on what gives the company the best opportunity to succeed. In terms though of a final question before we break, Max, on the presumption you were given access to Pantheon's data as part of the recruitment process, what was it that gave you the confidence to move from, I hope PETRONAS won't take this the wrong way, a relatively secure employer to become I think -- in fairness, I think it may have been a comment on Max's ability to hold the job rather than PETRONAS being relatively secure. And I know the individual who is asking it would definitely not wish to insult you or PETRONAS. What was it that gave you the confidence to make the move?

Self-confidence I have, I would say. I've done this twice before in the Permian and in the Montney. The only difference is the quality of resources here is higher. But I think in my interview the other day, you may have seen it. It's quite rare for someone to say, there's 2 billion barrels in your backyard. So I started my career in Alaska. It's been very good to me. And I'd like to round off my career and give back to Alaska. Alaska has been hungry for something like this for 20 years, a new basin opener. And as we've been saying all day, this is for the benefit of our shareholders and the state of Alaska. It's just a golden opportunity to achieve both goals. But at face value to me, having done this for 33 years, this is a very attractive proposition given the resource base and all the advantages we talked about. And for me personally, it's -- I can get back to Alaska at the same time.

So with that, thank you all very much for having joined us today, whether in person and boy, there are a lot of you in person and online, and there were quite a lot of people online as well. As I say, apologies, we didn't get to every question, but it will be more efficient, I think, for everyone's time for us to aggregate and answer them in the generality on the Q&A on the website. Again, please don't hesitate. If you've got a question, odds are it's interesting to more than just you. So please could you come through the channel as [email protected]. Congratulations to the person who knew the Greek word for anonymous or the Latin word for anonymous, anyway, some old language word for anonymous, in order to submit some of your questions, kudos to you, which is itself an old. And thank you once again. We look forward to whenever we next engage.

Fantastic. David, Max, thank you very much indeed for updating investors today. On behalf of the management team of Pantheon Resources Plc, we'd like to thank you for attending today's meeting, and good afternoon to you all.

Thanks, everyone.