Workover rig secured for flow testing program in August.
This morning our 2021 Catalyst Hunter Pick of The Year Grand Gulf Energy (ASX: GGE) detailed its next steps for its helium discovery in Utah, USA.
Today, GGE confirmed that a workover rig had been secured ahead of a planned re-entering of the Jesse #1A well in August, where the ultimate aim will be to obtain a flow test for the helium discovery.
This news comes after GGE completed the drilling of its first pure play helium well (Jesse #1A) and confirmed a new helium discovery with helium grades consistently measuring between 0.44 and 0.65%.
Importantly this was well above our base case expectations, even surpassing our bullish case expectation of a helium grade >0.4%.
We now know that GGE has the following:
- A proven helium structure that can be followed up with additional drilling. ✅
- Commercially viable helium grades above our 0.4% expectation (GGE’s grades were between 0.44 and 0.65%). ✅
The only missing link for GGE to go from helium explorer to producer was a commercially viable flow rate.
Today’s announcement now gives us a timeframe for when we can expect to see GGE go back and test the well again to see if its discovery can produce commercially viable flow rates.
- Commercially viable flow rate 🔄- GGE now expecting to re-enter the Jesse #1A well in August.
In a previous GGE note we detailed our bullish, base and bearish case expectations for the flow test results, to read that note click here.
