Quantum Helium Ltd (AIM:QHE) has cleared a key regulatory hurdle in Colorado, after receiving formal approval from the US Bureau of Indian Affairs for the Indian Mineral Development Agreement covering its Coyote Wash project.
The AIM-traded company said the IMDA provides the contractual and regulatory framework to explore and develop helium and hydrocarbons on Tribal lands at Coyote Wash, where it holds a 100% working interest and operates the project. With the agreement in place, Quantum said it can now push ahead with final permitting, well planning and drilling preparations across five mapped Leadville helium prospects, while also refining development plans for Ismay oil targets.
"The approval of the Coyote Wash IMDA is a major step forward for Quantum," said chief executive Howard McLaughlin.
"It provides the regulatory framework required to advance what is already an independently verified 0.97 BCF 2U gross helium prospective resource with additional oil upside."
"Coyote Wash adds real scale to our Colorado portfolio. At the same time, our immediate focus remains on Sagebrush, where the extended production test at Sagebrush-1 is fully prepared pending final regulatory approvals."
The approval follows a previously announced independent resource review by Sproule ERCE, which confirmed 2U gross prospective helium resources of 0.97 Bcf at Coyote Wash. Sproule also identified prospective recoverable oil resources of up to 1.77 million barrels (3U case) within the Ismay Formation. Combined with the 0.134 Bcf 2U gross helium prospective resource at Sagebrush, Quantum said it holds 1.104 Bcf gross (828 MMscf net) 2U prospective helium resources across its Colorado portfolio.
Attention now turns to Sagebrush, where Quantum said it is still awaiting formal BIA approval of the assignment of operatorship, although the regulator has confirmed all required documentation has been received and is in good standing.
Carl Dumbrell, Quantum Helium executive chair, meanwhile, added: "Our visit to Colorado this week was extremely productive across technical, operational and stakeholder fronts. We reviewed seismic interpretation, field operations and final testing preparations, ensuring alignment across the team."