The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
GLJ, an energy consultancy out of Canada has raised their base price of helium to $450/mcf. Very big news for the profitability of Helium One in the event of a discovery - every BCF is now nearly half a billion dollars…
How is dedicating the last 3 years of your career not ‘putting your money where you mouth is’ though. You’re staking your reputation and career on an O&G play.
As Wyndrum said - how much does he have to put in to appease you? Such an arbitrary concept if you actually think about it.
The weirdest thing about your posts muscles, there’s criticism of the board/company that I think are completely reasonable and some I would agree with… you just always seem to find problems where there aren’t any!
Not sure ‘no skin’ is fair. He has ~£20k in and given his work history you can tell he’s not some multimillionaire with £££ to throw around. Just a down to earth geologist with a proven track record - certainly been instrumental in some big M&M companies, and now his time to shine heading one up.
In all fairness maybe he should be putting more in as he doesn’t have to pay a mortgage… he’s been living in your head rent free.
Morning ITV
I generally keep the posts technical but I feel the time for discussion of the fundamentals is over. The project is weeks away from ramping up so now is time to sit back and enjoy the ride. Big money to be made and I’ve gone all in now, all down to Mr Minchin.
Is it not because my post comprehensively answered the question postulated by the initial post, geared towards the company the board it’s posted on is dedicated too?
Not sure likes make any difference on here anyway…I’ve seen great posts go unrecognised and absolute dog water get double digits.
Yes more of a sweeping statement but would be applicable to helium gas specifically too. Of course helium is a very valuable product so a more scaled down resource would be viable compared to other gases.
Seems to have cut off some of my post.
This style of stacked trapping was seen but unfortunately not tested in the Tai1 prospect whereby 5 stacked helium units were found within the Karoo, beneath the 130m thick lateral sealing unit.
It is my person belief that had they have been able to test the Karoo shows they would have confirmed a discovery, but different-than-expected reservoir qualities proved this to be impossible. I imagine they will be tearing the same structure (more north/deeper) this time to get to the bottom of the Tai-closure. If they hit, I think they will hit big (multiple BCF payload) but if they find little-no helium it will indicate the sealing unit (as previously mentioned) may have cracked and released its payload over the geological time is has been sat there.
I hope this helps to understand the pros and cons of the two fault closures. Ultimately it’s risk v reward - I personally believe a lot of the geological risk has now been mitigated for Tai but we will find out the reality in due course.
Hi Skittish,
Interesting post as ever - I don’t really look into noble much so thanks for breaking down their thesis.
If you consider helium exploration in the Rukwa basin to simply be an extension of classic sedimentary petroleum/hydrocarbon geology (of which at times helium is found as a trace byproduct) I think it would indicate that both methods are viable, but as ever is dependant on the unique basin parameters of source, seal, reservoir, trap, maturation, migration and most importantly luck (AKA timing on a geological level). You can compare and contrast these 7 key parameters and extrapolate the pros/cons yourself, it’s largely down to personal interpretation at this point, especially given the basin is largely unexplored.
As in conventional O&G exploration, you require a lithiological unit that can store your escaping helium, this must be a permeable + porous rock. In HeliumOne’s case this is the sandstone reservoir rocks, I don’t know the underlaying geology of Noble but given their proximity to us I would imagine they have an analogous reservoir play.
Now where it gets interesting is the trap and seal aspect as this is where the two fault closures differ.
All trapping plays revolve around ‘structural traps’, where a fault pairs the aforementioned reservoir rock against an impermeable cap rock (seal). No matter the seal, as long as it’s impermeable it will lead to an accumulation of the gas/oil over geological timescale until the reservoir is literally overflowing (this is where you detect seeps at surface in a single trap system).
Nobles trapping style is intrinsically ‘safer’ as a trap as it is typically easier to predict, model and interpret its position on a macro model of the basin. This means if you have a migration model that indicates flow of oil/gas towards your traps (and possibly also surface seeps) you are more likely to hit a discovery of what you’re drilling for. However, the drawback is that typically these seals have lower volume payload trapped in them and are therefore less likely to be economically viable. It’s hard to explain without showing a picture but by having your seal/cap juxtaposed against a vertical unit, in 3D space you are effectively reducing the maximum inflow and reservoir by at least half.
HeliumOne’s style trapping on the other hand is inherently more risky as the seals are both harder to find and also the chance of them having shifted and released their payload over a long geological time is astronomically higher than that of a margin fault closure. However, the upside is that once you find a thick and robust intra-basin closure (especially between formations such as the 130m karoo sealing unit at Tai) you are more likely to be in for one hell of a discovery.
On top of this, these intra-basin closures are typically (not always) in stacked fashion where even if one seal breaks, it’s payload is then caught by the higher sitting seal until it hits a big seal-system (e.g 5 helium
While I understand the disappointment, I do think they have a chance to redeem themselves by getting this 2023 campaign rolling. If they get the rig RNSed with baker hughes locked in all will be forgotten. They MUST bring this plan home, failure to do so simply can’t be an option.