Pepperell, 33, who has two previous wins on tour, both in 2018, shot up the leaderboard with his birdie burst and overtook Dane Jacob Skov Olesen, who carded three birdies and an eagle in a bogey-free 67.
"After bogeying the second hole I was worried it was going to be one of those Thursdays again," Pepperell said. "But I turned it around really nicely and played very well to be honest. So I'm very pleased."
There is a pack of six players a shot further back on four under-par, including a trio of South Africans in Jacques Blaauw, Wilco Nienaber and Jayden Schaper.