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Thank you for the clarification! Still leaves up majorly in profit!
The lowest risked prospective resource estimate of 3.05Bcf at todays price of $450(£343)/mcf is an in-situ value of $1.37b/£1.05b. 2U/P50 of 14.04Bcf risked its €4.9b/£3.7b. I dare to even dream of the higher risked or unrisked estimations…
Each modular plant can process ~0.35Bcf a year which is roughly ~$157.5m/£120m worth of helium.
You need to subtract the operating costs. At $250/mcf this was estimated at $32-37/mcf. With an increase in input cost and tax at the new $450/mcf you could guess this may sit around $70-100. Presuming they can find buyers and successfully ship out all this processed helium a year that gives a net $350/mcf or $122/£93m, per modular plant.
Initial start up costs for production testing, plant mob and set up and miscellaneous improvements are estimated to be about $50m-$70m. This could be returned, per plant, within the year.
All that in mind, after the first year of production where the plant is essentially paying back itself, you’re producing ~£93m of pure cheese (although you’d have to further subtract additional costs and any new exploration costs underway). That alone provides a profit value of ~0.14p per share per year of profit for a minimum of at least 9 years at the very lowest risked prospective estimate. That is an intrinsic value of ~£1.28.
From here, it’s hard to predict the share price. What is £1.28 profit value alone worth to the market? What is the full basement derisking worth? What about the additional eyasi/balangida sites?
I genuinely believe that finding one successful helium show could cause this to rocket, even when looking at the very lowest resource estimates.
you need to predict the share price. What is ~£1.28 of value worth to the market to hold?
Patience pays off
Nice open today - 300k bought vs 35k sold. Share price up 5%.
This two post conversation perfectly sums up why everybody left Mikes group chat.
Hi all,
I have a couple weeks break between projects at the end of April and I’m thinking about doing a comprehensive overview of He1 past, present and future.
What specifics would you like to see included in such a post?
I believe in general the rule is that you can attach a narrower drill bit to a wider frame, but not a wider drill bit to a narrower frame. So I think that is fine.
Look into their loc 400 rig, this has surely got to be it? Pretty meaty bit of equipment too!
Just realised Huisman are headquartered in the Netherlands, have a Texas office and operate some ‘highly mobile rigs’… makes you think
Just been discovered from an article posted in the HE1 telegram, thought it might be of use to people who are trying to piece together data to work out potential rig providers.
From todays 'thearmchairtrader' article.
I honestly think this quote is huge and people are sleeping on this RNS.
Further volumetric analysis can be used increase the p50 (138BCF currently).
I asked a question for the AGM about plans to carry out volumetric analysis to increase the companies current resource and reserves in the event of a successful discovery from this seismic campaign. Hopefully they answer this and we get more idea on the plans to do so!!
@Porky - Out of curiosity, are you in the telegram?
I still have my money on Sakson Drilling!
@Dai - David himself said in an interview ~3 weeks ago that they are committed to drilling in summer this year.
QS said "I have to say I am not confident that DM will pull it off with regards securing a rig on site in time to drill, this year.".
Given that David has stated he is committed to drilling this coming summer, I am asking QS as to why he believe this would all of a sudden not be the case. I don't agree with him, but I am curious for his reasoning behind the statement.
To me, seems very unrealistic for David to fumble the bag so close to the finish line. I am curious to know his reasoning for this post.
For what reason do you believe a rig won't be secured? Multiple recent interviews have indicated they are currently working towards an MOU... Genuinely curious for your reasoning behind this post.
I wonder why source is only 90. Given the knowledge available in the literature, surely this should be 99, if not 100. Guess better safe than sorry, but seems odd.
Just to add on, the broker report states ‘ 54p would be attainable if success was certain.’. To me, this valuation would be on just the presence of confirmed helium. Further testing for its commerciality and then the implications this has on the basin must take this to multi £ territory!
While I’d love to ‘50bag’ here, if you run the realistic finaniclas (based on hopeful resource estimate of 500koz) it caps at about an 6-7x. Would need way over 1000koz for such movement. 6-700% is still incredible prospective for a 12-18m timescale.