US trading up 3.5% near open at US$1.23. At current exchange that is pretty close to 89.5 pence so markets seem to be just balancing out. Yesterday US was trading slightly behind UK in terms of exchange rate. TXP is exactly the best arbitrage candidate at least in US with the $50 trade cost on many platforms, but there may some of that. In the end there won't be big gap between any of TSX, US OTC and LSE.
This is all happening pretty real time - the sidetrack was successfully drilled in the last few days and was even cased. So they are off to side of the old well bore and are drilling ahead. They should be at the site of the second helium show (where the drilling broke down only nine meters into the helium charged formation) either now or over the weekend.
This is Royal Helium, another primary helium play - in Saskatchewan. I have followed it since their drilling program started early this year. They have drilled 3 wells at a prospect called Climax and just did an equity raise and now have enough cash to properly evaluate that and one other prospect. They have a discovery at well 3 at Climax where they found a "regolith zone" that was not suspected and has very high He levels (9% on one sample - the rest of the pay zones on their lands are more like 0.5%). They estimate 6 BCF of Helium. They are doing further evaluation of this zone (including a fourth Climax well targeting this zone spudidng soon) and plan to produce it quickly. The only reason I mention Royal Helium now is because it is now trading on OTC in US as RHCCF (just listed in the last week). Before that it was only on Vancouver Venture Board and I could not easily buy it in US. It is cheap, there is a lot happening in the next six months, I am building a small position to keep me interested. I think it s a complementary holding to He1, as is DME. I still have my best hopes for He1 of course, and a much bigger position, but these companies are a little ahead in that they have discoveries and will likely be producing before He1. It will be good to watch how smoothly they get their production facilities up and running. They have a corporate presentation on their website, the news releases from 2021 are there, and there are some good interviews including a very recent one. Cormark and one other broker have targets around $2 Canadian - it trades at 50 cents C or 40 cents US. It is slightly below where most recent private placement was, though each privately placed share came with a two year warrant for 1/2 share at 75 cents. It certainly hasn't had a big run up like DME and it is still largely under the radar, at least in US. You have to do your own DD, but I am interested and I am buying some.
I did buy a small amount today at @ US $1.20. I have been reviewing every aspect of this story and I still like it and it is still my highest conviction holding among my small cap special situation/turnaround picks (which are all of course high risk/high reward.)
Xavier Moonan is still a major part of my conviction. I would say that he (and others) did an amazing job in planning and executing and then publicizing this visit of the Energy Minister to every important TXP site.
I call these shares my due diligence dollop.
has begun..... (not "has began"). I used to say "If you cannot spell it, you probably cannot do it" - but that is no longer true.
It sure is a beautiful rig, and very advanced. But that could mean anything. Star Valley is out of Calgary. I thought the rig was already in Houston. If not does that mean it has left Calgary on way to Houston? How long will that take? Or does it mean that the rig is already in Houston and they are moving it to Green's Port for loading (that is what I hope it means). If so when will the ship be available? When does it depart? How many days (?6-10) does it take to get to Trinidad? (I wish we had a tracking number - I am sure Paul does). Once on the Island it should not take too many weeks to get going on the 2021 commitment of shallow wells on the legacy leases (and they will include one deep test). Wonder what the composition of the drilling crew will be? They want to hire some local experienced drilling personnel but they also want huge experience and technical know-how. Wonder what part of the crew the bring with them.
Paul plans to have Cascadura project producing 200 mmcf/day in 12-18 months. Again mentions that Chinook gas will go there. That will be a lot of liquids too and the wall of cash will be a reality.
But first steps are to QUICKLY get the Coho well hooked up and then the Cascadura 1-ST and Cascadura Deep wells hooked up. That will get them north of 60 mmcf/day into sales and will provide the funding for the canadian rig to start banging out shallow wells on legacy lands including a deep test, then three cascadura development wells, then hopefully (if Royston is a discovery) some Royston development wells. And don't forget the second group of exploratory wells (including Kraken) will be moving forward at the same time. There is more ahead of us than behind us. But there is urgency to start monetizing what we have already found and tested and is all ready to go. They 1300 bopd from legacy production cannot pay the bills any longer as we enter (hopefully) this hyper growth phase.
I think the plan is that NGC will buy the Coho pipeline connection and also the Coho surface facilities because that is their policy. Cannot even imagine how long that negotiation will take (said humorously).
I still don't get the Shell impediment at all. The central block is still producing well but at maybe half its peak production. There is ample capacity for the gas and they had agreed to take it. Maybe the NGC wants to run it into the big main N-S NGC pipeline but that is a big distance for 10 mmcf/day. Maybe that is why NGC actually was involved in discussions of a second Coho development well, so the volumes would be greater and maybe would justify a longer pipeline spur to the east (rather than a short pipeline extension to the south).
You are right about any Chinook gas going to the Cascadura collecting site - and from there to the main N-S NGC pipeline. That drill pad is only 1.3 km from the Cascadura drill pad. And Cascadura 1ST and Cascadura Deep wells are only 900 feet apart but were drilled from the same pad so the production end of the two wells cannot be more than 100 feet apart. They just need to have the whole Cascadura development plan finished and accepted and then NGC has to get that connecting pipe in the ground. The Energy Minister wants all that to happen by end of 4th quarter.
Here is Paul Baay quote from today….
“ Touchstone is currently completing our testing at Chinook-1 and expect such gas production to be added via pipeline to the Cascadura facility."................
I don't agree that they would "stage" a big flare for a visit of a government official who is trying to promote a middle ground between green energy and the most responsible lowest CO2 footprint use that is possible for hydrocarbons. It is not like a little bonfire for making s'mores.
As I said it was "somewhat" off topic to talk about DME here so you could have skipped that thread. The reason I posted it here was the topic of He3 level in the helium gas (300 ppm vs 5-20 ppm). The higher level of He3 may pertain to the Helium one given the source of our gas and prior testing of helium in Tanzania - and that might have some implication (positive) for the company. Or not.
From the flare it seems obvious that they are in middle of flow test which should take at most a few days. Then they will do a pressure build up test which can take up to a week. This testing will help determine at what rate the well can be produced. And also can be used to help calculate additional reserves.
I think they would prefer to link the operations update with an announcement that Royston has spud. Maybe they can include some other items also, like a final decision on where Coho will be tied in, and even whether or not they will move quickly to a second Coho well to boost production there (a site for second Coho well is shown on their current corporate presentation). Maybe a word about the status of the Canadian rig. Maybe they could talk about potential for Cruse development wells and whether horizontals are an option. Canadian rigs and drill crews are pretty good at horizontal drilling.
Other items are down the road a ways. Like Cascadura development plan and NGC starting construction of the pipeline spur to the Cascadura site. Those items may be a month or two away, maybe linked with the report of initial Royston results in the next operations update (after this one, which I expect in 1-2 weeks). As Paul says, there is more ahead of us than behind us.
This one from his FB page. Some additional pictures in the last couple minutes. And a comment from Xavier about next visit being at first gas.
Trinidad energy website issued revised set of photos with CHINOOK in capital letters under the two photos of the flare.
aim looking at the photos of flares from the other three discovery wells in the current corporate presentation, this flare is smaller than Cascadura1-ST and Cascadura Deep flares. But it looks pretty similar to the Coho flare.
Well the Chinook well pad is not as close to the as yet unbuilt pipeline extension to the cascadura well pad - as the coho drilling pad is to an actual working pipeline. And here we are a year and a half later and Coho gas is still totally stranded with the pipeline lengths piled up at the site but not a piece of pipe in the ground. A nano liquification module and some trucks sounds better and better.
Thanks for your comments, I was hoping there would be someone more knowledgeable than I am right here!
The Wikipedia page on Helium 3 is fascinating. Apparently there are something like 200-300 He3 atoms per million He4 atoms in primordial helium (cosmological helium) from deeper plumes, but diluted to 20 ppm or less in helium gas from crust/mantle source diluted by radioactive decay of uranium and thorium. Seems like it would be very costly to pull out those 300 helium atoms in a million, but maybe a lot more feasible than extracting 20 helium atoms per million. Sounds like DME may have a buyer if they have the higher 300 ppm concentration of He3 in some of their reservoirs and the government would likely extract it (at Los Alamos? to do fusion research) and then sell the He3 to Intel. That is all rank speculation, musings of the barely educated.
That is very interesting - I learn a lot here - I didn't even know they had such things as nano liquification plants - NGC could pay for one of those since they get a good long term price on the gas. I actually wonder if they have any. One of many vendors is cryonorm.
Capacity: <10 Metric Tons per Day
Capacity [gallons/day]: <6,250 gallons per day
Capacity: <75 Metric Tons per Day
Capacity [gallons/day]: <46,875 gallons per day
Capacity:<500 Metric Tons per Day
Capacity [gallons/day]: <312,500 gallons per day
Cryonorm LNG liquefaction Plants are designed in compliance with EN-1473. Nano- and micro scale units are fully skid mounted designs.
Based on customer demand, Cryonorm completes the installations with gas pre-treatment, LNG storage tanks, truck loading bay and/or power generators.
Possible sources for LNG are:
Stranded gas fields
Associated / flared gas
I'm quickly in over my head and I think I will need an Oxford Professor of Noble Gasses to chip in here. There is evidence of higher He3/He4 rations in Tanzania suggesting a plume from lower source rather than helium from upper mantle. I do not know if there is any commercial implication to this or how hard it is to separate He3 from He4. As I said I'm way over my head. But there is stuff out there.