Blue Star cranks up helium resources, expands planned drill program
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Special Report: Blue Star has upgraded prospective helium resources at its Enterprise and Galileo prospects by 16 per cent to 3.5 billion cubic feet.
This accounts for the additional leased acreage that the company has picked up since the first resource assessment in late May this year along with a general audit of the resource calculations by independent global energy consultants Sproule.
The recent leasing has also led Blue Star Helium (ASX:BNL) to expand its drilling program to a minimum of three wells and up to five wells to test several prospects in addition to Enterprise.
“I am very happy with the 16% increase in our prospective helium resources at Enterprise and Galileo and I am looking forward to soon receiving Sproule’s independent review of our Galactica and Pegasus targets,” managing director Joanne Kendrick said.
“Our preliminary internal assessment ranks the Galactica and Pegasus drilling targets on equal footing with Enterprise, which is very exciting.”
She added that the expanded drilling program will maximise the prospective resources tested and deliver clear advantages over the previously planned single well at Enterprise.
Helium is a high-value commodity that is vital in a number of modern technology applications such as MRI, nuclear medicine, rocketry and space exploration.
While it is traditionally a low concentration by-product of natural gas production, Blue Star is targeting high helium concentration accumulations on its acreage.
Both Enterprise and Galileo are located within a fairway proven by the Model Dome helium field, which produced gas with grades of up to 8 per cent helium before it was acquired by the federal government for its strategic reserve.
The company has already staked out the location of the first hole at the Enterprise prospect and is working closely with the regulator to progress permitting.
This has an estimated dry hole cost of $US300,000 ($419,080) with a further $US100,000 if commercial amounts of helium are discovered and the decision is made to complete the well as a producer.
Blue Star will also be undertaking an immediate site visit to select the additional drilling locations in preparation for selection and well staking.
Drilling approval for the newly selected locations is expected in early 2021.
Further leasing opportunities are progressing to consolidate several prospects across the portfolio, including around Voyager where a further independent resource review is planned.
This article was developed in collaboration with Blue Star Helium, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.