Member Info for Tex2374

Quite from Minchin, take it at face value I guess but it seems they realise licenses = income.

"We've seen Tanzania turn around in the last six months," he said as he noted Barrick Gold's award of more exploration licences in the country. "Tanzania is open for business and this is the time to be involved."

Yeah Wolf, we need to use a better platform. I am calling HSBC tomorrow to see if they can give me an answer in terms of timeframe. Like you, I would rather avoid paying anymore tax than I have to..

Tex

We will know when they plan to start drilling once we have confirmation of the contractor they will use. This still hasn’t been confirmed. Hopefully that is the next news to drop in the coming weeks.

This is from last month.

"Helium One will drill three wells to a maximum depth of 1,200 metres. Each well should take a month to complete and the company is in negotiations with contractors. The company can make savings as a result of the downturn."

3 holes and drilling timeframe of 1 month per hole with the timeframe as stated of Q1/Q2 so feb.March kick off should be about right.

This is the first exciting step to proving the concept!
Tex

Very interesting.... thanks, Dan!

Thanks Dan! what do you use Helium for (if you don't mind me asking)

I would love to start to build a position soon, Poor. But HSBC won't let me. If they don't get their act together soon I am going to have to go open up another account to invest here.. I assume HL are OK with HE1??

Hi FatherT

DME have 10 bagged this year . But will be producing within 12 months and have already produced from that reserve decades ago, so they are way ahead of HE1. That said, their reserve is much less (not sure if the comparison of production). Their current SP is about 2x HE1 so not multiples of where we currently are.

Yes Helium is categorised as a mining element in Tanzania, but you drill it, not mine it, so O&G comparisons make more sense than mining exploration companies, in my view.

I don’t disagree that costs will be lower than a traditional O&G play just pointing out there is a long road ahead to realise the $30+bn

Anyway, wasn’t looking for a fight on a Tuesday morning, so apologies if I came across as patronising.

Tex

It’s a bit early to post this, but I am not expecting any more news this month.

What a great 2020, fantastic progress made and it’s seen the SP move from 1.8 to 4p+ and almost reaching new all time highs.

I’m not going to list all the ticks in the boxes we have achieved but I think it’s fair to say that the foundations are now in place for a transformational 2021.

Roll on Q1 and the PEA, trial mining license, potential Partner and other news from ValOre with maybe some increased focus on Uranium???
GLA
Tex

Also worth noting the stake Scirocco have in HE1. Not sure what they can bring to the party but could be interesting.

I would be interested to know if there will be any plans coming from the Attis side? Does anyone think there may be a secondary play there? I don’t have any real history on Attis and haven’t been invested.

Tex

Morning all,

Best to go with the estimates in the investor presentation and interviews . BLM price $280mcf and the company expects to hold a resource of 138bcf. The resource value HE1 quote is $36bn.

Minchin stated that production costs (once the gas is out the ground I assume) are $50m for the plant to refine the gas to 99.999% (seems to be relatively simple venting process without any waste by product). The plant can handle 350.000mcf per year producing about $95 million in annual sales

Operating costs for the facility are $5-6m per year. Mostly power related. Transport and distribution seem quote ‘simple’.

Numbers all look good. However, I would agree with Delta that people need to be grounded. There are lots and lots of oil and gas plays which have provided similar estimates of fantastic numbers and either not delivered or been delayed by years . HUR was one, Sound Energy with their golden tickets. , Bahamas petroleum BPC is a current one about to spud after years, they have quoted amazing numbers but the SP has had a rocky ride. Closer to home there is the ongoing money pit of UKOG.

Huge potential here but the 10x price will not come till the company is revenue producing (IMO)which is 2023-24 and there are always delays in O&G plays especially with junior explorers who need to get licenses, local approvals and agreements.

First they need to announce they have a contractor to drill the 3 initial wells (I can’t find confirmation of this anywhere. I think this will be the first major news, it will get people interested) then prove the find by the end of H12021 then appraisal drilling and seismic to understand “the trap geology fully” (I am lost at this stage). 2022, if the feasibility assessment all stacks up) they need to look for cash to build the $50m plant which will take 1 year to construct and then plan producing 2023-24. They will also need to start to secure some offtake agreements prior to production.

Plus, they need a drilling partner of course, so revenue and margin estimates need to take into consideration that we are going to be sharing the rewards.

Not trying to put a downer on the share. This has great potential and seems a lot more straight forward than the majority of O&G plays and is a really interesting play. But there is a long road ahead

I will buy into this share with an expectation of investing £1 and getting £10+ back by 2025. There will also be lots of opportunities to take profit and buy in on the dips.

I love the enthusiasm on the board and I’ve taken the time to read up and research it quite a lot. I like this play and I think there is a fun journey ahead. Just don’t get carried away with the big resource numbers, they mean nothing if you can’t get the stuff out the ground, refine it, transport it, sell it.

Tex

Same process as any gas drill so pretty much the same as oil and it’s land based

Good corporate presentation http://www.helium-one.com/wp-content/uploads/2020/12/20-12-04-Helium-One-Presentation-December.pdf

I agree Mark. Unfortunately, it’s a problem on any board where the rampers are in control, it is literally impossible to have a debate about anything.

Unless you are throwing around multibag numbers, you’re a “troll’’ or being paid to post. It’s crazy and people honestly think these posters bashing any contrarian view have made a long term investment. .

Wolf has great knowledge, insight and points. People should be glad to have some balance and actually debate points, otherwise you are just in the echo chamber.

Rent over. :-)

https://twitter.com/davidburton1971/status/1338455428926156802?s=21

Worth a scan if you haven’t seen it. Grab a beer or two it’s quite long :-)

Correct, johny, that makes the 350,000,mcf from the initial planned production plant look pretty good at first glance.
Tex

Wolf, I have the same issue with HBSC.
Unrelated question, are you on Twitter ? Here is a lot of posting going on about HE1
Tex

I don’t think finding enough Helium is too much of an issue. They have already spent $8m on exploration to date on. Seismic etc , plus the stuff is seeping from the ground where the drill holes are planned and it’s seems high % . :-) (no idea if this is good but my simple brain tells me it must be a good indicator)

The drill approach seems relatively low cost which is good, but I am not sure how much of the resource they can prove from the initial 3 targets (I don’t have the knowledge to comment about gas structures or anything like that maybe someone is on here with real O&G knowledge)

I think phase 1 and 2 should be fine (I.e prove the discovery and that it is commercially viable). Then the fun starts in terms of a road to production for 2023-24.

It’s a long journey and I am sure there will be lots of twists and turns and it is obviously quite capital intensive, plus (as discussed over the weekend) we will need a partner to find the drilling.

For peer comparisons check out DME and Gazprom both of which will be producing by the end of 2021.

Very interesting sector, fun to read up on helium usage and the market.

Tex

RMS 5p by year end? Not sure what you are smoking, especially since production and sales don't start till Jan and initial mask orders are only a few million in the first 2 months.

RMS completely (so far) missed a trick on their GTM, licensing and production model, IMV. I posted on this over the weekend if anyone is interested. Yes it will go up but not 150% by the end of Dec (if you are talking about the next 2 weeks). Their issue is that they don't have the management experience, gravitas and seniority, to get the big deals done.

I am in both shares and I expect more short term upside here than RMS.

Just my view
Tex

Very strange picture... everyone is sitting at 6.5 on the bid. only one on 7 and five on 7.5 on the ask.....

looks like we will just be bouncing around that range today.

Interesting Hydrogen... if we assume drilling the initial 3 holes is completed by July 2021, that gives 2 years to put relevant licenses and sign-off in places for the 2023-24 production target. hopefully they can get that done in that timeframe.

On an unrelated topic, does anyone have any experience with any of the BoD... in these sort of plays a lot of the risk is centrred around the BoD and their ability to execute, as well as their longer term strategy and drivers..
Cheers,
Tex

Transportation distance isn't a real issue IMV, the additional cost compared to a closer port is just fuel and a driver, which aren't major costs. In these sort of jurisdictions you just don't have the level of infrastructure as in other parts of the world so it is just part and parcel of the play. In their words "Simple logistics to port via Dar es Salaam"

I am not sure about the economics required to make a pipeline viable but I imagine the associated cost would be huge and only established when there is a viable level of production.

As for security, yes I am sure it will be a consideration, however, I'm not sure there is a huge black-market for Helium.

Tex