Member Info for Blubay

And what is your opinion based on exactly?

No, it just indicates the normal process of licencing in which any proven exploration company has a realistic expectation of conversion to a mining licence.

Sounds sensible, inexcusable to be largely underwater in a year that's been as good as this one for market returns.

Don't be ridiculous PC

I think that's sensible. A larger scale project probably lends to mixed financing commitments. It's a new strategic industry and in a region that the government wants to open up for more investment anyway. You'd hope government would be considering some kind of strategic investment sweetener beyond the specifics of a project share, whether that's transport infrastructure, processing plant, power generation, water management, etc. If there's any major international off taker interest then similarly there's a strong case for public co-financing to tempt those companies into TZ.

OK, I take that back, there's a bunch of posts covering speakers :-)

It's nice that HE1 get a prominent billing here, considering how many speakers there are at the event

The normal sequence of events would be first mining licence approval, then formation of an SPV (with mandatory participation of the TZ government), then financing negotiation between the SPV with the TZ banks (who must be approached as a first option if debt is needed), and then approval of those financial terms by the government. The only alternative would be if debt was not needed because full finance was already in place (plenty of scope for speculation there perhaps but we'll see).

Indeed, Joe invented a hypothesis to justify an imminent raise here (which hasn't happened). It's plausible enough to merit discussion but contingent on information that is not yet available to the market and therefore unknown. The current project plan for Rukwa doesn't foresee any drilling operations before March 20225. It's possible but it's not currently in plan. However, Joe's hypothesis seems to be that HE1 can't start any negotiation of larger project finance for Rukwa without first proving flow rates using artificial lift at ITW-1 (ESP), for which he suggests there is no current funding contingency. It's a hypothetical, I would dispute it. We haven't seen the subsurface modelling, the feasibility study, or the current finances. As you say, there's no known reason to expect an imminent share raise. It's always possible on AIM of course but it's not likely here before the end of this year.

If they've any sense, they'll fund the proving up of ITW-1 using their share of equity in the Colorado project as loan collateral, once the drill programme there is underway.

June 2024

"The net proceeds of the fundraise will be utilised to complete the EWT and additional drilling at Itumbula West-1, as well as providing additional funds for operational contingency. The budgeted cost of the operation is US$10.2 million which includes a 5% contingency...

Following the completion of the proposed Fundraise, the Company will be fully funded to complete the EWT, with a working capital runway for a minimum of 12 months from the date of Admission."

https://polaris.brighterir.com/public/helium_one/news/rns/story/x27qjnw

In terms of the June raise, judging from some comments in recent interviews, the implication was of little if any headroom for overrun contingencies on the EWT in that raise so I suspect that part was accounted for as stated (and thankfully there was no overrun). Bearing in mind also the comments about fully funding working capital for the company until at least June next year. On balance, that raise probably did what it said on the tin. Hard to say what headroom there is on the more recent raise for the farm-in deal, depends if the development plan progresses on time and budget I guess.

From the last raise, which fully funded all of these investments

You said... "I would hazard a guess the guy is ready to slow down towards retirement, hoping I'm not doing him a disservice, but if he went to high school in 1974, then he will be around the young 60 marker! Plus, with the company about to grow exponentially, it's potentially going to increase involvement, so good on him, he's probably decided the time is right to hand on to a 'younger' stallion..."

That's just weird, but good luck in your next venture

Much more. A key development is that the Colorado project will move from prospective to productive and its value should increase exponentially (the value of HE1's 50% share) along with the value of the additional licence areas. This should allow HE1 to treat the US asset as additional collateral in financial discussions. For example, it may be possible to borrow against NAV or sales on the US capital market (and service the debt from the revenue) to fund initial proving up work in Rukwa,

Yes, it's very positive indeed that they have chosen to retain all six licence bids in Southern Rukwa for mining development. If they had given up all their licences except the one or two at Tai/Itumbula then it might have suggested a risk minimisation to keep just the bones of the project but it looks good that they've gone for the whole field.

That's not what you said, you said 60 was too old to be a director which is utter nonsense

Swarts is an old school South African mining CFO, they're going to need someone with finance experience in the US capital markets. I wouldn't be totally surprised if they replace their own CFO too.

No way of knowing but I suspect it's more likely he's been voted off, to be replaced by someone with experience appropriate to the company's new stage of development and its diversification of geographical focus.