When you think of Alberta, Helium companies may not be top of mind.
But look no further, First Helium has identified many follow-up drill locations and acquired a well operating infrastructure system which will help expand future exploration programs. Consisting of two main projects, the Worsley area consists of 60,000 acres and is 100 per cent owned by the company. The second area, the Lethbridge area, is a 276,000-acre project with drill locations ready this year.
Here today to talk all things Helium is Ed Bereznicki, CEO of First Helium.
Hello, and thanks for joining us today, Ed.
TMH: It appears to be exciting times in the Helium business – with global demand for helium increasing in the high-tech and space exploration, in addition to renewable energy applications, helium prices seem to be robust for the near to mid-term and into the future. But what will First Helium be focused on for the next 6 to 12 months to capitalize on this unique sector opportunity?
EB: Brieanna, there’s a number of things that we’re going to be working on. The first of them is the completion of our 3D seismic program on new lands that we purchased last summer up at Worsley to augment our inventory of helium and oil drilling locations. The second thing we’ll be working on is finalizing and announcing a helium gas offtake sales agreement, along with providing some further direction on processing facility construction and on-stream timing. Thirdly, we’ll be announcing exploration and development plans, including one drill-ready well location up at Lethbridge and completion and testing of our 14 of 23 horizontal wells, which we drilled last summer and then lastly, we’ll be examining potential opportunities to accelerate the development of our drilling activity up at Worsley.
TMH: First Helium recently announced that it was commencing a 3-D Seismic “Shoot” on new lands purchased at its Worsley property. Can you give us a brief overview of that program and what investors can look forward to?
EB: So just for investors, for those that don’t know, 3D seismic is really a tool which enables our exploration team to analyze and visualize, if you will, the geologic structure beneath the surface as they work to identify potential traps for natural gas, helium and oil accumulations. So, what’s key to us is that we have two successful oil wells last year that we drilled, and those were both identified and drilled using 3D seismic that we had either acquired or shot on a proprietary basis. This year’s 3D seismic program is on land directly adjacent to those wells. In addition, our 15 of 25 helium well is identified on 3D seismic, and so what this does is confirms our geologic model for the region, and this becomes very important as we continue to explore the Worsley property and confirm additional drilling locations.
Just through the analysis of this data, we expect to identify a number of additional drill locations on the new lands, which will bring our total drill location inventory at Worsley to over a dozen wells. Now, this is a large inventory of high-quality potential prospects and provides some great upside potential for investors, and while our existing cash flow from our oil production helps pay the bills, so to speak, we’ll also be examining ways including the possibility of adding partners to help accelerate the development of this project Brieanna.
TMH:First Helium has announced plans to bring its 15 to 25 helium well into production within the next 12 months. Where is the company at with that initiative?
EB: The company spent the last six months finalizing its facility design alternatives and reviewing helium gas offtake options. Right now, we’re in the process of entering into a helium gas offtake agreement, and we expect to be able to announce something to the market in short order here. Once that’s been finalized, we’ll be announcing further details on the processing facility construction schedule and the expected timing of the first helium production from the 15 of 25 well.
TMH: There has been a fair amount of helium-related news emanating from Southern Alberta recently. The company’s Lethbridge asset lies at the heart of this activity. What can investors expect in the way of news from this property over the next 6 to 12 months?
EB: The area’s been very busy recently with announcements by other helium companies and explorers in connection with successful helium drill tests, large land farming agreements, and in addition, based on some work we’ve done, there’s one private helium producer, which is making approximately 75 MCF of helium per day out of the region and this is up from zero production in the region just a few years back. At current prices of over US $400 per MCF or a thousand cubic feet, that represents significant annual revenue per year. So, what is exciting for first helium is that it has a drill-ready location targeting Beaver Hill Lake and Basil Cambri and Sandstone that is planning to drill in 2023. Now, this well is located in the greater Napa area, where recently another Helium Explorer has announced a successful well test from one of the same target zones, Brieanna.
TMH: In terms of new drilling activity, when is First Helium planning on drilling its next series of wells?
EB: That’s correct, and what we’ve got planned in terms of the next series of wells just to review, we’ll be completing our 3D seismic shoot evaluating that data and then prioritizing our total drilling location inventory for Helium, natural gas and oil over the next few months. Now given the scale of the number of potential drilling opportunities that first Helium has, it may consider alternatives to accelerate capital investment and development in this project. With all that in mind and given consideration to the other priorities we’ve got both in the field and elsewhere, I would target late Q2 for new drilling activity Brieanna.
TMH: Well, it sounds like investors can anticipate an exciting year of activity from First Helium. Is there anything else you would like to add before we let you go?
EB: I think what I would ask investors, or first off, I’d like to thank investors for their patience and ongoing support throughout 2022 and encourage everyone to keep track of our ongoing activities and updates for what promises to be an exciting 2023, and you can check those out at our website, firsthelium.com.
Again, that was Ed Bereznicki, the CEO of First Helium. To find out more about the company, feel free to check them out at firsthelium.com. You can also hunt them down on the TSXV under the ticker symbol HELI.
A special thank you to you, our viewers, for tuning in. I am Brieanna McCutcheon for The Market Herald, and this has been The Top Line.
FULL DISCLOSURE: This is a paid article produced by The Market Herald.