The company needs to raise as much as one million dollars to fund its participation in the wells stretching from offshore north-west of WA to New Zealand's North Island. However, Mr Svalbe is confident the investors will stump up with the cash because of the leverage it offers the exploration program.
The Carlston-1 well in WA's Carnarvon Basin is a good example of the substantial leverage at work. Pancontinental has a 10 per cent interest in the well, which is targeting a potential 38 million barrel reservoir. With 12 million bbls expected to be recoverable, this would mean oil worth of $120 million at $10 bbl in the ground.
Pancon's share would be $12 million or 13 cents a share, considered a good return given the current share price is trading at five cents. The four other wells in Pancon's exploration program are considered to have high chances of success, in particular Walyering-4 in the Perth Basin, which is targeting 40 million bbls of oil equivalent.
