Mosman Oil and Gas Ltd (AIM:MSMN) has confirmed the completion of its acquisition of an 82.5% working interest in the Sagebrush project in Colorado.
"We are pleased to finalise this important acquisition where we believe there is additional oil potential and significant helium potential. It is a great combination with the adjacent Coyote Wash project 100% owned by Mosman,” chief executive Andy Carroll said in a statement.
"The oil revenue from the producing wells will help fund the ongoing exploration and development program."
The Sagebrush-1 well, drilled in 1984, tested non-flammable gas but was not assessed for helium. The well made an oil discovery above the salt layer and initially produced over 600 barrels per day.
Since production began, the project has yielded more than 300,000 barrels of oil across nine wells, with seven currently producing around 17,000 barrels a year.
The transaction was effective from 1 January 2025.
Now that the deal’s complete, Mosman intends to progress exploration efforts focussed more on the area’s helium potential.
It plans to reprocess 2D seismic data, and acquire 6-8 square miles of new 3D seismic in the southern portion of the Sagebrush Project. The combined cost of this work is estimated at $500,000, funded from Mosman’s existing cash resources.
Mosman highlighted that it has identified helium prospects in the Leadville formation below the salt, with permitting and environmental surveys underway.
Drilling is targeted for late 2025, pending regulatory approvals.
In London, Mosman shares advanced around 7.5% on Monday – and they are up around 40% in 2025 to date.