Noble Helium announces first two drill targets at North Rukwa

Today Noble Helium (ASX: NHE) have announced their long awaited drill targets at North Rukwa basin.

It’s an important milestone for NHE as the company approaches its Q3 drilling program:

Two highest priority drill targets selected ✅

The two targets, Mbelele-1 and Pegere-1 combined have an unrisked mean recoverable helium prospective resource of 16.5 billion cubic feet (bcf).

This accounts for less than 10% of the project’s total unrisked helium resource of 176 bcf.

Here are the targets on Noble’s 3D map:

We take it as a good sign that the two wells are close by to a cluster of helium soil anomalies, this is what we were referring to when we said there was helium literally leaking out of the ground on NHE’s project.

These are the “near-vertical” wells:

The main purpose of these two wells is to prove that there is a working subsurface helium system.

The targets are not particularly deep, with Mbelele-1 at ~800m and Pegere-1 at ~1200m, this reduces technical drilling risk further.

Mbelele-1 will be drilled first, as there may be potential for multiple stacked reservoirs and could increase the total recoverable helium resource from North Rukwa.

Mbelele-1 is going to a shallower depth and is closer to the targeted Basin Margin Fault.

We think the next catalyst for NHE will be to secure a farmout partner, which would firm up funding for the two wells. The data presented today would form part of NHE’s pitch to farm out partners.

It is worth mentioning that NHE is also going after a helium resource which is associated with Nitrogen, or what could be called “Green Helium” - 95% of the world’s helium is produced as a by-product of fossil fuels.

The nitrogen associated helium NHE is pursuing adds to their ESG credentials.

What’s more we think it is possible that helium end users could one day pay a premium to secure “Green Helium”, in excess of the already high helium prices - click here to see our rundown on a recent NASA contract which included forward helium contract prices.

What’s next for NHE?

Farm out partner secured 🔄(Non-binding bids due by the end of this month)

Rig contract executed 🔄 (Q1-Q2)

The big one: Drilling 🔄(Q3)