Helium One Global Ltd (AIM:HE1, OTCQB:HLOGF) has reported initial flow rates from the Jackson-31 well at the Galactica helium project, in Colorado.
The well flowed naturally, and flow testing has shown increasing rates, reaching approximately 250,000 cubic feet per day (cfd) of total gas.
After engineering analysis, it’s expected that the stabilised flow rates will be between 300,000 and 400,000 cfd, with a maximum potential rate of 500,000 cfd.
The company noted that the well exhibited strong pressure build-up post-testing, indicating high permeability and good reservoir communication.
Initial gas sample analysis has returned helium concentrations of up to 2.2%, and it's expected that the reservoir helium concentration is in the range of 2.3% to 2.5%.
Testing and sampling activities at Jackson-31 are ongoing.
"This is an encouraging update, and investors will be keen to hear how drilling of the Jackson-4 well is proceeding and of wider development activity," Panmure Liberum analyst Ashley Kelty said in a note.
Helium One owns a 50% interest in the project alongside partner Blue Star Helium.