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They’re just doing exactly what they said they would do. There may be a derisking effect once they’ve completed that but some will be priced into the expectation of these low risk shallow drills. Hopefully getting the production on stream is a bigger step. But it all adds confidence and reduces risk at every step.

No indication whatsoever of any problems. All seems to be going to normal plan so far.

Hundreds of millions of dollars worth of gas to go at in Colorado, once fully developed and brought to market at low cost with zero debt, multiple times the value of the current mcap in NAV (not all of it recoverable of course).

Like shooting fish in a barrel, four wells drilled without a hitch plus one in the bag from earlier. On time and on budget, and hopefully extra contingency cash unspent so far. Straight on to the last of.the current drill permits at Jackson 2. Then we find out if they will drill another or focus on the production plant.

No it isn't. you know as well as anyone that they've said they're are not going to dilute shareholders without shareholder agreement, and that they have sufficient cash for all planned operations this year.

The board has given a clear indication of its preferred approach to funding Rukwa development. It's been said a hundred times but there is not a cat in hell's chance that Rukwa will be funded by an HE1 share raise. They've said all along that the approach would be based on project funding, which is normal for this kind of venture. We know the project has to be run by a new venture company in Tanzania, in shared equity with the government. They've said there will likely be some combination of debt and equity split in that new company, and they've mentioned previous contact with potential off takers. We know the overall ballpark development capex costs, the scale of the licence area, and the number of wells needed to make that work commercially. And we have the well test results from Itumbula as a preliminary indication. There's not much else they can say until a basis for the new company is set out in the framework agreement, with or without the involvement of collaborative funding partners.

They have accepted the offer, which begins the process of establishing the framework agreement.

They can't possibly comment on any negotiations to establish the framework agreement before that's concluded

Has no direct bearing on HE1, the revision of the mining regulations imposed a retrospective change of obligation on existing ML holders. But the conditions attached to the Rukwa licence are known from the outset and yes, they will likely include some obligations for minimum project spend per annum etc. HE1 have agreed to the licence offer so they have probably agreed to similar conditions and that's good news if it signals their confidence in that commitment.

No one is ‘day trading’ with these spreads.

Great news

Fully proving up the model, the wells at the centre of the field have higher helium and less CO2, and those at the edge the other way around. Both either valuable commercial markets.

For the avoidance of doubt, the fund raise last August included all HE1’s expected costs to develop Galactica to production (if all goes to plan, which so far it has).

“ · US$1.5 million in respect of past costs incurred by Blue Star on the Galactica Project;

· 100% of the costs in respect of six wells capped at US$450,000 per well;

· up to US$2.55 million in in respect of the Company's 50% participating interest share of the tie-back, installation andprocessing expenditures required for the development of the Galactica Project;

· the balance of US$1.18 million in respect of associated fees, legal costs and working capital and development contingencies.”

No, read the acquisition RNS. It is funded for three things, consideration of BNL’s initial work, plus drilling six wells, plus the processing plant and tie in.

Again, faultless development schedule so far, which really boosts confidence in the ability to get things done. High levels of helium free gas confirmed again and go ahead to start on the processing plant for commercial production. All falling into place and all fully funded. Excellent.

This is fully funded within the contribution from HE1 to the project acquisition up to $2.25m.

The board certainly intimated that they would seek to ringfence the project, which I think means they don’t want to collateralise Galactica to raise debt for Rukwa. That makes sense anyway as Rukwa will be ringfenced in the new SPV operating company. However, previous RNS have also referred to the future of Galactica revenue helping to fund across the company portfolio, so maybe that’s where it came from.

Not forgetting the 10% spread

As you well know Dazes, the company has already announced to the market that Rukwa is assumed to be commercially viable and they've announced the ball park costs and parameters estimated to achieve that.

Situations change. The point is that the company now has both Galactica and Rukwa, two commercial projects in development and in different global markets, one nearing production and one entering appraisal stage. The real value story for this company has changed, and it won't come from realisation of a single project but their ability to roll out the revised business strategy of moving from explorer to producer by acquiring and developing a portfolio of projects globally. Galactica is crucial to that proof of concept and the reinvestment is very modest. They need to drill another nine wells in phase two and we've seen how quickly and cheaply that can be done (let's say under $5m, and this time HE1 will only be paying half). The processing plant will be up and running already in phase one, so that's potentially than less than 12 months profit to reinvest and they'll have 50% share in a 15 well production field netting them a clear $5-10m pa with zero debt. That alone would be worth most of the current mcap at 5-10x P/E. Rukwa could double that income in time if they can drill enough wells but potential revenue per well doesn't look as profitable yet. The signals so far are that they're looking at an appraisal phase using a pilot scale processing plant to prove up the model, we'll have to wait and see. Either way, the medium term market value of Rukwa probably hinges more on confirmation of the strategic NAV than on revenue, which hopefully is a big number.