Blue Star Helium Ltd (ASX:BNL, OTC:BSNLF) has honed in on a high helium concentration at the JXSN#3 discovery, which forms part of the Galactica/Pegasus prospects in Las Animas County, Colorado, with shares rising as a result.
The latest results mean the helium explorer encountered high helium concentrations in each of the three wells drilled as part of its first exploratory water well program.
Moving ahead, Blue Star has four helium well drilling applications in the work, designed as immediate follow-ups to the Galactica/Pegasus discoveries.
What’s more, another 29 helium wells for Galactica/Pegasus are in various stages of the permitting pipeline.
In the meantime, global energy consulting and advisory firm Sproule is working to upgrade the Galactica/Pegasus resource estimates and Blue Star expects to at least declare contingent resources at the helium targets.
Gas column “larger than expected”
Blue Star managing director and CEO Trent Spry commented: “We are happy to confirm high helium concentrations from the JXSN#3 well to round out an exceptionally successful initial exploratory water well program at our Galactica/Pegasus prospects, which saw high helium concentrations being discovered in each of the three wells drilled.
“The gas column in JXSN#3 is located outside the Galactica P50 prospective resource contour and is larger than expected.
“JXSN#3 is located around 6.4 miles southeast of the Denton B#1 well, where Blue Star had previously interpreted gas to be present on historical logs.
“These two wells show that the Lyons formation is helium bearing across a large part of the Galactica structure, where Blue Star has a dominant/extensive acreage coverage."
Shares have been as much as 27.6% higher this morning to A$0.037 with more than 30 million changing hands.
The results are in
Blue Star has recovered high helium concentrations from each of the JXSN#1, JXSN#2 and JXSN#3 exploratory water wells, which were drilled at the company’s Galactica/Pegasus prospects.
Back in May, Blue Star declared a discovery at each of these wells.
From here, samples that best represented the reservoir gas were selected for air-free calculation and normalisation.
This returned 1.98% helium from JXSN#1, 3.14% from JXSN#2 and 2.14% from JXSN#3.
Next up: Voyager
Blue Star recently appointed consulting engineer SIGIT to prepare a plan of development, including a front-end engineering and design (FEED) study for an initial processing facility at the nearby Voyager prospect.
In addition to its work at Galactica/Pegasus, advisory firm Sproule has been engaged to prepare the first independent resource assessment at Voyager.
Meanwhile, BNL plans to complete dedicated appraisal and production wells in the larger-than-expected gas column in order to maximise flow rates, which are therefore naturally expected to be higher on an equivalent basis.
Helium market balloons
Blue Star’s latest announcement comes as the market for helium heats up.
“Helium prices are at all-time highs, with a number of commentators reporting helium sales of up to US$600 per million cubic feet and anecdotally helium spot sales at between US$2,000 and US$3,000 per million cubic feet,” Spry explained.
“Naturally, we are keen to sell helium into this market as soon as possible.
“Our consulting engineers, SIGIT, are preparing a plan of development for our Las Animas prospects.
“Following the discoveries at Galactica and Pegasus, they will now also commence an additional FEED study on a processing facility to be located in the Galactica/Pegasus/Serenity area.
“This is in addition to the FEED study we announced previously for a facility to be located at Voyager, which is similar to the Model Dome field that produced in the 1930s and lies 6 miles to the southeast.
“Helium bearing gas (at roughly 8% helium) was discovered at the BBB#1 well during our first exploratory water well campaign last year, triggering the plan of development and FEED study at Voyager.”