Member Info for skittish

LW, don't want to get into a too and fro over the rig, but DM's two 'options' for an offer of a single drill were the toxic Predator rig, which I think is still available, as it is so toxic no one will touch it, and the Exalo rig where despite a 'loi' we were passed over by the rig operator.

I think he was 'over enthusiastic' which maybe why he had to go.

LB does indeed say we have the option to go it alone but that is not the same as getting a rig contract.

It is a question really of whether you think the rig share is simply a way of saving money or a necessity for actually getting a rig.

Hopefully we'll never find out.

LW agree with all in your penultimate post except perhaps for that last line...

If you invest you have to take management on trust (can be dangerous, I know) and Noble have much more experience in Africa than us, it was they it appears that both found the rig, and suggested the rig share.

But it is not a question of why wouldn't He1 go it alone, of course they would, but rather why would Sofori sign up for a single drill on the other side of Africa?

I don't think they would.

The loi rns refers to "a" loi, implication jointly with Noble, not several loi's, so that would be for the 3 drills.

3 drills and follow up next year, if successful would tempt Sofori, especially if Noble gave them the 100% success patter, new helium province, work for 20 years etc etc.

That said I expect the farm out to be successful, based on the Noble directors track record alone, Noble said complete in Q2, so that appears end June for rig contract at the latest, could tie in with a late August/early September drill for us.

The Tz government get 16% of all mining projects, together with taxes and licence fees etc.

As it should be, I hasten to add.

Not sure Noble haver their offers in yet, they are still bigging things up, and offerors have every incentive to wait until the last minute.

If they have got a "string of pearls" along the basin margins, so likely have He1, as their licence areas lead to ours along the basin margin.

Two separate companies, but IMHO the market will regard these 3 drills as a joint effort.

He1 and Noble are joined at the hip, whether we like it or not.

Would be interesting if the farm in partner were the Tanzanian government itself.

I'd say it was almost inevitable, rig share is only the first step, and that was Nobles idea.

But the most important thing is the drill, so both companies now effectively have three chances, will success be 3/3, 0/3, or somewhere in between?

I'll go for 2/3, but not saying which ones...

Interesting patches on the ground near to perceived Mbelele-1 location, imagery from May 2022.

We know that Noble have been interested in this area for a while now.

https://www.flickr.com/photos/194934344@N06/52816754880/in/dateposted-public/

Question is - how soon after final bids are in do they get access to the bidders cash?

I think that the capex requirements are really irrelevant.

They are intending between them to supply 20% of the global helium market.

A few hundred million $ here and there really is irrelevant.

If they hit a commercial reservoir, money (and some slight dilution) will not be an issue. Of a little more concern is that Noble are targeting 2028 for production - 5 years?

Noble have also altered the depth of Pegere-1 to 1200M from 800M. Their graphic now makes more sense.

It is also possible to more accurately locate Mbelele-1, which is likely to be their first well.

https://www.flickr.com/photos/194934344@N06/52816216051/in/dateposted-public/

It is now just 100 metres from the roadway, which leads almost directly to Tai.

They couldn't have dovetailed it better with drilling at Tai if they had tried.

After months of cloud cover it appears to have now finally stopped raining at Tai.

This is a Sentinel 2 view from 9-4-2023.

https://www.flickr.com/photos/194934344@N06/52815057436/in/dateposted-public/

Still very wet on the ground though.

Roll on Q3!

Assuming that it is still in Tunisia, that is where it appeared to be in 2017.

Could be anywhere now.

Maybe Noble are trying to get the best farm out deal that they can.

The CEO owns 31% of the shares.

Keeping the share price high and indicating options regarding rigs may place pressure on bidders to improve what they may offer, bearing in mind none of them will know what others are offering.

As regards He1, it is clear that Noble are the only show in town as they can't get a rig for a single drill.

KIethOz, presumably they also are more likely to get approval from Tz authorities.

Dobby, the thing is that we have been cashed up now for almost 4 months, and yet we wait.

If it is not for Noble then what for.

We can't get a rig for a single drill, no matter how much money we throw at it, it would appear.

Accept that as the reality and you can then chill and not stress over He1.

So we wait patiently.

Sounds great!

Multiple potential partners.

But it also sounds like this farm in process could take a while.

Only now do they undertake due diligence and have access to the data room, in order to structure their offers.

Meanwhile He1 waits patiently.

Q2, should be

Q3

Good question - there are certainly many more fairly highly paid staff now than there were immediately following IPO, so that is one large expense.

I think immediately following IPO they were undercapitalised, hence the quick second fundraise.

Then they were using the Mitchell mineral rig - a "low cost option" - sounds great "looking after shareholder funds", but in the end proved a disaster, and two years on we as shareholders , are still paying for that.

But yes, I think they were unrealistic at first, but have since beefed up the team, so with around $13M in the bank at present have a much better handle on things this time around.

Perhaps DM's inexperience in running such operations proved to be his downfall. Steep learning curve.

I think the tie up with Noble is really interesting, presented as a cost share for sourcing the rig and attendant expenses. But Noble's team have a great track record - you think their geologists and engineers are not talking to our geologists and engineers, sharing knowledge and the geology? I think the team work is probably already much closer than they let on. Good for both, but perhaps especially for us.

I don't think DM ever intentionally tried to mislead, but I think he was maybe out of his depth. That is why I look carefully at the subtle changes in the language they use. I suggested at the beginning of June 2022 that the 2022 drill may be in doubt (not many likes for that post), as DM's language had changed in an interview he gave, the written transcript was different to what he actually said - and so it proved.

Now LB's language has subtly changed for I think a drill later in Q3 is now pencilled in.

But DM was wildly enthusiastic over Tai-1, until the drill broke (presumably when it hit the fault), and then all the other issues ensued. So I also take that into account, when determining what to do and position myself accordingly. Prior to the drill break he was really upbeat over whatever they were finding.

I have a much larger holding this time around, but perhaps foolishly never sold. As a longer termer hopefully I'll clean up!

We will see.

Incidentally, whilst LB was in Tanzania no pictures of her at Tai? Admittedly they wouldn't have revealed much, an open field at the Tai-3 location, but she was only 200km away, did she not visit?

Maybe a signal of a more business like approach?

Watching that language carefully.

Personally I'd say $1.8M isn't all that bad.

We know that they have a hefty wage bill, 7 directors to support together with now a quite long list of various experts.

JS said at the AGM they are all essential to the operation, so I feel we have to take that at face value.

Whilst they are just ticking over, as at present cash burn isn't all that great, it appears to be the drilling and seismic which eats up the cash at a rapid rate.

Provided we get that discovery today's cash burn will all be forgotten about.

Been thinking about a few things recently concerning this board, and the activity which has taken place recently.

Firstly much was made over the last few months by numerous posters over the Predator rig, and who paid for it to be done up? The implication was that He1 footed at least part of that bill and that DM and shareholders had been rinsed, for no benefit.

Yet when the accounts for the 6 months to 31-12-2022 were published, on 27-3-2023, not a peep out of anyone over the scandalous revelations therein.

That maybe because there were no scandalous revelations.

The only expenses He1 had during the period were for administration amounting to $1.8M (everything is in $), and after exchange rate fluctuations the loss was $1.2M.

So effectively He1 whilst carrying out no activities except normal administration and ticking over, has a run rate of $300,000 per month.

So it is clear that He1 paid nothing to have the Predator rig fixed, but no one points this out despite fairly regular innuendo over DM “mismanagement” or worse, in prior months.

Second is the rig itself.

Believe me, no one is more frustrated than me concerning the delays and the US rig saga, Predator and Exalo. Maybe there have been missteps but the really important point is that in the present market of fairly high oil prices no rig provider is interested in contracting for a single well in the middle of Africa, when there is no guarantee of a follow on.

Much is made of LB apparently saying that He1 doesn't have to wait for Noble to contract, but I don't think she has ever said this, what she said is that He1 retains the right to contract alone if Noble were unable to do so.

All this talk of “No rig”, “rig deal imminent”, whether it be Monday, next week, Friday, ISA day, or whenever, is just setting people up to be disappointed.

LSE is bad enough, but over on telegram you would think every next day is going to be rig deal day.

Maybe it is really sophisticated trolling, bigging it up only to knock it down, so that people invested sell, when the reality is that the rig contract ain't going to appear any time soon – that may be disappointing to some, but IMHO it is realistic, and you have to look at what is real, rather than what you want to be real.

The Noble rig deal answers these difficulties, as it is obvious that no one will contract with Noble either for their two shallow wells – hence the Tanzania Buyers Club.

So as I've said many times over their timetable is now our timetable as it looks like rig providers may pick up the phone when they know it is a call relating to a three well deal.

Noble's farm in bid deadline was yesterday, 31-3-23. I had thought that the successful bid declaration could come as early as mid April, but more likely the end of April, with cash coming in soon after and then rig deal for both He1 and Noble around early to mid May.

Cont/...

Cont/...

However a wiser head than mine had pointed out correctly that Noble also needs to get Tanzanian government approval for the farm in bidder, in which case things may take quite a bit longer to be approved.

All Noble has said is it expects the farm in to be completed in Q2 2023, so that is anytime between now and end June.

So that could put the rig contract back to as late as early July. Which means no drill till at least early/mid September.

LB in her last interview on 13-3-23 seemed to ditch the mid August spud (outlined at the 15-2-23 AGM), emphasising she was still confident of “a Q3 spud” - a subtle change, but in the past subtle changes have been a signal (intentional or otherwise) that matters are different to those previously advertised.

What had changed between those two dates?

Well the Tanzanian Buyers Club was formalised with Noble and LB visited Tanzania around 1/2-3-23 and spoke with government ministers. She couldn't speak/negotiate on behalf of Noble of course, but maybe she emphasised that not only was Nobles drill dependent on the farm in being completed successfully, but so was Helium One's. Maybe she got a better idea of when that process would receive Tanzanian approval.

The rains don't come until December, farm in approved say early June, so rig contract mid June to mid July, He1 drilling mid September to mid October, Noble drilling mid October/November would still enable the three wells to be completed before the rains.

Such a timetable may seem way too pessimistic to some, especially the “RNS tomorrow” boys, but I always try to make my predictions slant to the pessimistic side, but despite this my predictions have proved way too optimistic in the past.

Like it not, He1 and Noble are now in a symbiotic relationship.

Nobles wells are the shallowest they can reasonably drill, far shallower than Tai-3. They are on land (around 90% of Nobles leads are underwater), on the same side of Lake Rukwa as Tai, and just 75km from Tai, a couple of hours drive for rig and crews.

And if you look here, Mbelele-1 will be likely drilled on an arc somewhere between these two points. It will be around 100 to 200 metres from a major road.

flickr.com/photos/194934344@N06/52785725055/in/dateposted-public/

Everything has been done to make Nobles wells quick and simple and to fit in with drilling at Tai.

I'm really optimistic that He1 will get that discovery (usual caveats apply), but having everyone gagging for an imminent RNS isn't doing anyone a favour.

IMHO/ DYOR etc