Catching up on last week’s news and starting again with the drills, Helium One (HE1) collaborator, Noble Helium (NHE.AX), announced a A$13.5 million placing to drill and test its first well and purchase long lead items for its second well at the North Rukwa Project. The drilling rig is now said to be preparing for a mid-June mobilisation to Tanzania. Under the co-operation agreement to share costs, Helium One will use the rig first to drill its well in August, before Noble Helium drills its first two wells in September and October respectively. With long-term helium pricing of US$450 per thousand cubic feet (50 times the price of LNG), potential future numbers for both companies are significant.
Molecular Energies (MEN) announced first quarter Argentina financial results and a corporate update. The company reported a turnover in excess of US$8.6 million and EBITDA of US$2 million. EBITDA for the second quarter is currently expected to be greater. The little discussed, but high-impact Tapir exploration well in the Paraguayan Pirity Concession remains on track for a spud at the end of the first week of July, targeting a complex of prospects, estimated by MEN to contain in aggregate over 260 million barrels of P50 unrisked resources, with a chance of success of 17%.
Beacon Energy (BCE) announced mobilisation of the drilling rig for the planned Schwarzbach-2 development well in the Erfelden Field, onshore Germany. This “upcoming drill” has been much touted by some on social media, yet the share price has only declined. Read the Core Information section of the website and you’ll understand why.
Challenger Energy (CEG) announced that it has bid for, and now anticipates being awarded, the AREA OFF-3 licence, offshore Uruguay. This is the sole remaining available block offshore Uruguay; all other offshore exploration licences are held by the energy majors Shell, Apache and YPF. The licence area is 13,252 square kilometres and will increase CEG's total Uruguay acreage holdings to around 28,000 square kilometres, making the company the second largest offshore acreage holder in Uruguay behind Shell. Per Challenger, the block has a current estimated resource potential of up to 9 trillion cubic feet of gas from multiple exploration plays.
IOG (IOG) announced a corporate update. The Blythe H2 well flowed at a maximum rate of 22.8 million cubic feet of gas per day and 280-336 barrels per day of condensate, below the expected initial H2 gas rate of 30-40 million cubic feet per day. The well is expected to be brought on stream this month and, once on, H1 is planned to be shut in. The gas market also has changed. In January this year, IOG's average realised gas price was 214p per therm, however, that has fallen to 64p per therm. Near term prices now are less than half the level in February 2022 before Russia’s invasion of Ukraine. As a result, IOG is likely to breach one or more of its debt covenants and has initiated what it says are constructive discussions with an ad-hoc group of its largest bondholders. The company says it will keep shareholders updated.
Zephyr Energy (ZPHR) announced a placing, subscription and project update. The company is raising £3.15 million at a price of 3.5p per share. Net proceeds of the financing will be used to fund near-term capital expenditure at the Paradox Project. This is expected to include a production test on Zephyr's State 36-2 LNW-CC well plus future infrastructure and gas processing costs. The goal is to production test the well prior to the end of June and the company claims that evidence of high pressure and hydrocarbons in the well is substantial.
Barryroe Offshore Energy (BEY) announced that, in consequence of the Irish government’s decision to refuse to grant the lease undertaking, the company has decided that it can no longer proceed with the proposed placing and open offer. It has £152,000 remaining, approximately 3 weeks of working capital, and if funding is not secured in the short term one of the options being considered is a creditors’ voluntary liquidation. Going concern issues will delay publication of the annual accounts and if the company is unable to publish its annual accounts for the year ended 31 December 2022 by 30 June 2023, then trading in the shares will be suspended on 3 July 2023. Barryroe Offshore Energy, formerly Providence Resources, is a company I’ve warned about many times (see previous Sunday Blogs).
Thank you for reading and I wish a happy weekend to all. Please note the Private Blog (containing more) will be published this evening.