Helium One Global Ltd (AIM:HE1, OTCQB:HLOGF) presents a very exciting opportunity as the explorer is now “on the cusp” of a transformation into a production company.
That’s the view of Panmure Liberum analyst Ashley Kelty, who in a note this week repeated a ‘buy’ recommendation and a price target of 3.6p – representing substantial upside to the current price on AIM of around 1p.
Kelty’s comments came in a note following the release of Helium One’s full-year results, albeit the analyst described the explorer’s numbers as “largely irrelevant, given the changes to the business post-period end.”
His ‘buy’ note highlighted: “The move into the US with a farm-in to a 50% WI in the Galactica Pegasus project in Colorado coupled with the successful Itumbala EWT which has led to an application a mining licence in Tanzania which would allow for the development of the southern Rukwa Helium project.
“The upcoming drilling in Colorado could deliver maiden revenues as soon as 1H25, and the potential development in Tanzania leaves the company on the cusp of transformation into a production company.”
Kelty noted that investor attention would be on near-term activity in Colorado, where five new wells are planned, and he said that with more than £30 million of equity raised in 2024, the company’s balance sheet is ‘good shape’ – with Helium One fully funded for the initial development phase at Galactica.
He acknowledged meanwhile that that new funding would be needed in Tanzania, but it is conceivable that the company may be able to secure debt financing for that.