D3 Energy advances South African helium, natural gas ambitions with spudding of new well

D3 Energy has begun drilling of the new RBD12 natural gas and helium well
Well follows on from successful production testing at RBD03 and RBD10 which returned sustained flow rates and strong helium concentrations
RBD12 results will be used to plan ongoing development of the ER315 permit

Special Report: D3 Energy is looking to replicate its earlier successes with the spudding of the RBD12 natural gas and helium well at its ER315 permit in South Africa’s Free State.

The drilling of the well marks the next stage of the company’s ongoing exploration and appraisal program that is aimed at unlocking the full potential of its helium and natural gas assets.

D3 Energy (ASX:D3E) has good reason to be optimistic about the prospects of RBD12 given the recent successes it has seen with the RBD10 and RBD03 wells.

Following the installation of more fit-for-purpose and accurate metering equipment that was designed and manufactured in Australia to meet API and AGA standards, testing of RBD03 – a repurposed legacy gold exploration hole – nearly doubled gas flow rates to 147,000 standard cubic feet per day (scf/d) and confirmed methane content of 87.1% and 5.1% helium.

Testing of the RBD10 production well also achieved a very significant 52% increase in production over previously measured rates to 191,000scf/d.

RBD10 also delivered world-class helium concentrations of 4.7% with methane making up 87.7% of the gas stream.

The strong levels of helium seen in both RBD03 and RBD10 is hugely encouraging as the rare gas is expected to be the main driver for value.

Helium has traded between US$1000 and US$2500 per thousand cubic feet on the US spot market due to its irreplaceable uses in high-tech industries, including semiconductor manufacturing, nuclear energy, solar panels, optic fibre and the cooling of superconducting magnets in MRI scanning machines.

This price is significantly higher than the wholesale price of natural gas in South Africa, a country eager to secure any available volumes of the fuel to address its energy demands.

RBD12 to provide critical insights

RBD12 is located near RBD03 and is budgeted to cost ~$200,000 to drill and complete.

The well will be drilled to further assess the reservoir’s deliverability and to collect additional data on helium and methane concentrations.

Upon the successful intersection of gas, RBD12 will undergo production testing, which will provide critical insights for the ongoing development of ER315.

Results from the well will inform key decisions regarding well interference, spacing, and the future submission of a Production Right application to the South African authorities.

This article was developed in collaboration with D3 Energy, 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.