NHE lab results increase net pay by over two-three times.
Our helium Investment Noble Helium (ASX: NHE) just announced the lab results from its two well drill program at its project in Tanzania.
Late last year NHE drilled two wells across one of its ten targets - the Mbelele prospect targeting a 15.7bcf prospective helium resource.
Across its 10 targets, NHE has a project wide prospective resource of ~176bcf of helium which is the largest owned by any single company in the world.
Late last year NHE announced preliminary results from the two well drill program.
Today, NHE improved on those results with final lab results from the drill program.
Here are our key takeaways from today’s announcement:
- Helium grades up to ~2.46% confirmed in the Mbelele prospect
NHE confirmed grades up to 2.46% a lot higher than already producing helium projects around the world.
For context - helium grades across projects in the US average ~0.35% and the ones that are producing helium right now in Qatar and Algeria average between 0.05% and 0.19%.
- Net Reservoir thickness increased across both wells
NHE confirmed that net reservoir thickness increased by 3x for Mbelele-1 and 2x for Mbelele-2.
Nety reservoir thickness for the two wells now sit at 148m (Mbelele-1) and 271m (Mbelele-2).
NHE also confirmed high porosity and permeability across the two reservoirs.
- Results to date exclude the potential shallow gas cap.
A big part of NHE’s drill results was the ~10-15m potential gas cap NHE hit relatively shallow in its well.
The significance of the gas cap is that it would be a free flowing gas section of its well which would flow helium to surface without the need for any stimulation work.
NHE confirmed in today’s announcement that the potential gas cap would be tested in the next stage of works and all of the information from the program be used to update the Mbelele prospects resource estimates.
What’s next for NHE?
Flow tests on Mbelele prospect 🔄
NHE confirmed today that a low cost flow test was being designed together with the University of Queensland Centre for Natural Gas.
NHE expects the work to translate into a flow test for the Mbelele prospect.
Commercialisation progress 🔄
NHE also mentioned that “commercial negotiations towards securing a leased plant and offtake agreement are continuing”.
NHE has always been pursuing a speed to market approach with its project whereby it would put the project into production as quickly as possible to start generating revenues from its project.
Given NHE is preparing for a flow test right now, we expect the more material commercialisation progress to be made after the company can show potential customers the types of quantities it can produce.
