Quantum Helium Ltd (AIM:QHE) has increased its working interest in the Sagebrush project in Colorado to 90% after buying out a minority partner, bolstering its position ahead of a key phase of appraisal and testing.
The company acquired Jackal Oil Company’s 7.5% interest for US$85,000. Jackal, Quantum said, chose to simplify its portfolio, allowing for what both sides viewed as a clean and straightforward restructuring.
The remaining 10% stake is held by Quantum’s chief executive, Howard McLaughlin.
Quantum already has a drilled and cased discovery well at Sagebrush, and the board said the deal consolidates its position as the project moves towards production testing. No profits or losses were attributable to the interest acquired.
Seismic work and resource updates
A 3D seismic survey at Sagebrush is nearing completion, with fieldwork expected to finish within a week. Once processed, initial results should be available in January.
The survey is designed to tighten understanding of the Leadville formation encountered in the Sagebrush-1 well, identify additional targets and guide the placement of future appraisal and development wells. It will also integrate with existing 3D seismic over the nearby Coyote Wash project.
At Coyote Wash, independent consultant Sproule ERCE has completed most of its technical work for a resource report following seismic reinterpretation and reservoir analysis.
Quantum expects the final assessment within a week. The company previously published an internal best estimate of 1,072 million cubic feet of gross prospective helium resources, and the independent study will help shape next year’s work plan.
Regulatory progress
Quantum said it has seen constructive engagement with the US Bureau of Indian Affairs following delays linked to the recent government shutdown.
Final approvals for an extended flow test at Sagebrush-1 are pending, and the company is targeting the start of testing early in the New Year once those permissions are in place.
Chairman Carl Dumbrell said the increased ownership was a “very positive and strategic outcome” and added: “Operationally, momentum is building. The 3D seismic programme is nearly complete, we expect to receive the Sproule report soon, and our meetings with the BIA this week were constructive and encouraging.”