US helium appraisal well set for mid-March

Our 2021 Catalyst Hunter Pick of the Year Grand Gulf Energy (ASX: GGE) just put out an update on its Jesse-2 helium well at its US helium project.

GGE is ~50% of the way through constructing its well pad, has all long lead items purchased and a drill rig contract secured.

GGE expects drilling to be drilling in Mid-March.

GGE’s Jesse-2 well is nearby the Doe Canyon helium field (which produces up to 50% of North American helium) at ~20mmcf per day with helium grades of 0.4% from ~ 20 different wells.

Similarly, GGE’s project has the potential to host >20 different wells and we are hoping Jesse-2 is the first of many wells that GGE can put into commercial helium production.

The Doe Canyon helium field is owned by US giant, the NYSE-listed Air Products which has a market cap of US$68BN.

Below is an image of the two fields side by side:

The Jesse-2 well will follow up GGE’s discovery well (Jesse-1), which hit a proven helium structure with a grade up to ~1%.

The ultimate aim for Jesse-2 will be to see the company produce a commercially viable flow rate that warrants putting GGE’s helium discovery into production.

Here is what we know about GGE’s helium project now:

• ✅ A proven helium structure: A >61m gross gas column (with ~31m of independently audited net pay)
• ✅ Commercial helium grades: Helium grades of up to 1% returned to surface (higher than our 0.4% expectation)

For GGE to deliver a commercial helium project, it needs:

• 🔄 Commercially viable flow rate: GGE’s Jesse-2 well is being drilled with this goal in mind.