Mosman Oil and Gas Ltd (AIM:MSMN) told investors it has confirmed the presence of helium and methane at its Sagebrush-1 well, in Colorado, through a review of historic data.
The company’s technical team found gas sample reports from 1993 showing helium content of 2.76 per cent and approximately 20 per cent methane. The gas included 35 per cent nitrogen, 40 per cent carbon dioxide, and heavier hydrocarbons.
Flow rates from the historic drill stem test ranged between 152 and 163 mcfd, it added/
"We are excited to find such valuable helium content data that is within our broad range of expectations based on helium content of other wells in the area,” chief executive Andy Carroll said in a statement.
“This is an important data point to help assess the potential commercial value of not only our Sagebrush project but also our nearby Coyote Wash project.”
The company plans a production feasibility study to determine the best approach for gas separation.
Conversion of the well from oil to helium and methane production is expected to cost around US$100,000.
Existing pipeline infrastructure on site is also under evaluation.
Carroll added: “All initial indications are that the helium content and flow rate from the DST suggest this Sagebrush-1 oil producing well could be recompleted and converted to commercial helium production.
“This information enables us to move to engineering studies and commercial negotiations with the potential for helium production within 12 months utilising existing infrastructure.
Also, Mosman noted that future drilling at Sagebrush will depend upon 3D seismic data acquisition and regulatory approval, targeted for the second half of 2025.