Helium One Global Ltd (AIM:HE1, OTCQB:HLOGF) said its southern Rukwa project in Tanzania could become a “unique and strategic” helium development in Africa, following the completion of an independent assessment of the site’s resources.
James Smith, non-executive chairman of the AIM-listed explorer, said the independent Competent Person’s Report (CPR) confirmed the company’s long-held view of the project’s potential.
The study, compiled by international reserves auditor Sproule ERCE, supports earlier internal estimates that underpinned Helium One’s mining licence application last year.
The evaluation focused on a 480 square kilometre area recently granted as a mining licence, and determined contingent resources of 295.8 million standard cubic feet (Mscf) of helium in a so-called 2C case (a mid-range estimate), and 1.35 billion Mscf under more favourable conditions (3C case).
Additional unrisked prospective resources in the wider area were estimated at 709.2 million Mscf (2U) and up to 3.23 billion Mscf (3U).
Sproule’s assessment is based on a phased development plan starting with five wells and an early production system, expanding to a central processing facility and eventually up to 66 wells in total.
Initial output is categorised as “Development on Hold” pending final execution of the licence, while further production would require a standard licence extension beyond the first ten years.
Helium One, which also holds a 50% stake in a helium project in Colorado, said it is now focused on finalising the Tanzanian licence and preparing for early-stage development.
CEO Lorna Blaisse said: "We are delighted that the results of the CPR endorse the work that the team have carried out following successful drilling at ITW-1 and the subsequent extended well test last year, whilst also providing further confidence that we have a unique, unconventional helium play through a resource with capacity to make a material difference in a supply constrained market.
"This is the first helium contingent resources CPR in Tanzania covering a definitive licence area, and which can now be developed pursuant to the mining legislation under the Ministry of Minerals.
"This allows us to assign a greater proportion of contingent resources to the project, and therefore a greater degree of certainty on the quality of the resource.
"The results of this CPR, combined with the vast amount of work required in order to complete and present the company's feasibility study, demonstrate alignment in our modelling and evaluation of the play, and we are on track to advance the project towards development with confidence."