SASKATOON, SK, Feb. 28, 2024 /CNW/ - Royal Helium Ltd. (TSXV: RHC) (TSXV: RHC.WT.A) (OTCQB: RHCCF) ("Royal" or the "Company") is pleased to announce its initial set of development plans for 2024. With a focus on high grading the existing drilled fields in Saskatchewan, Royal's development efforts will be centred on the completion and testing of existing wells in the Val Marie, Ogema and Steveville properties and new drilling on the 40 Mile project in Alberta.
Royal Helium Ltd. Logo (CNW Group/Royal Helium Ltd.)
Mr. Andrew Davidson, Chief Executive Officer of Royal states, "With the Steveville helium processing facility online and building to capacity daily, we are pleased to be focused on determining the site for the next processing facilities. This is firmly the goal of all development work that will be completed in 2024. Given the drilling activities completed from 2021 – 2022, Royal is uniquely positioned to move from one facility to multiple in the short-term."
Val Marie, Saskatchewan
The Val Marie project in southwestern Saskatchewan is a 27,000-acre project which is 100% owned by Royal under a 21-year lease. The site of the most recent well drilled in the portfolio, the Val Marie-1 well is awaiting completion and testing of the zones of interest encountered in the 2022 drill program. The Val Marie-1 helium exploration well was drilled to a total depth of 2,596 metres. Mass spectrometer and gas chromatography readings during drilling encountered significant helium shows with multiple intervals ranging from 5 to 10 meters in thickness within the Devonian and the Cambrian formations. Val Marie-1 returned the highest background level helium results that Royal has encountered to date, including the Steveville field, which is now on production through Royal's 100% owned helium processing facility. Royal will be completing and flow testing of these stacked shows in the Devonian and Cambrian horizons.
The Val Marie field sits upon the Val Marie Arch on the northern flank of the Bowdoin Dome. One of the earliest projects in the Royal portfolio, Val Marie has long been a high priority field. The Bowdoin Dome is thought to be the dominant structure allowing the migration of helium into southwestern Saskatchewan reservoirs. Extensive regional mapping and geophysical work has been done with the tremendous amount of new deep well data available to Royal's technical team, which has enabled the team to define several additional drilling prospects on their lands in SW Saskatchewan.
Ogema, Saskatchewan
The Ogema project in south central Saskatchewan comprises more than 60,000 acres and is home to the eastern most helium wells drilled in Saskatchewan. Drilled and partially tested in 2021, upon receiving legislative permitting changes in 2023, Royal is planning to perforate and test the Ordovician Red River formation within the wellbore with the view of making a production and plant decision.
The Red River formation in south central and southeastern Saskatchewan has long been a prolific oil and gas producing formation that boasts helium prospectivity with the numerous shows across the province. This formation has returned the highest concentrations of helium historically, with test results as high as 2.45%.
Steveville, Alberta
In 2021, Royal drilled three wells at the Steveville helium project in southeastern Alberta. The processing facility is being fed by highly productive Devonian horizons that will provide material cash flow to Royal through the offtake agreements that it has in place with one of the largest space exploration companies in the world.
While Steveville-1 well was not contemplated for production after the initial completions testing, subsequent geological review completed since August of 2022 has identified a potentially productive zone remaining behind pipe at Steveville-1. Royal intends to test this new zone.
If successful, the addition of a third well feeding the Steveville helium facility can increase the productive life of the current Steveville project by as much as 33%. While it will not increase the throughput, as maximum capacity at the facility is achieved with the two tied-in wells, Royal has the ability to tie-in the third well to the facility which will allow for a production buffer if either of the two current production wells move offline for periodic maintenance. Further, it will allow for a lower production rate from each of the wells to extend the current engineered reserve life of 9 years significantly, while not sacrificing the feed rate at the facility.
40-Mile, Alberta
In 2023, Royal acquired its newest project area in southern Alberta. Acquired under a seismic option agreement with an independent private vendor, the 40 Mile project is comprised of 7,000 acres and boasts one historic well that was drilled, flow tested and assayed. This well flowed at exceptionally high rates during initial testing and returned helium concentrations exceeding anything that Royal has received to date.
Royal completed seismic work at 40 Mile in in 2022 and 2023 and has multiple seismically defined drill targets across multiple prospective zones. It is intended that drilling on the 40 Mile project will commence in the second half of 2024.
About Royal Helium Ltd.
Royal is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Company controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, Royal is well positioned to be a leading North American producer of this increasingly high value commodity.
Royal's helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore the plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
Andrew Davidson Chief Executive Officer Royal Helium Ltd.
Cautionary Statement Regarding Forward-Looking Information
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release includes certain statements that may be deemed to be "forward-looking statements". All statements in this news release, other than statements of historical facts, that address events or developments that management of the Company expects, are forward-looking statements, including anticipated deliveries under Royal's offtake agreement, the intended construction of helium processing plants, intended drilling activities and the processing capabilities of Royal's existing wells and potential wells. In addition, all references to resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the resources described exist in the quantities predicted or estimated and can be profitably produced in the future. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the Company's control, including without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, volatility in production rates, environmental risks, inability to obtain drilling rigs or other services, capital expenditure costs, including drilling, completion and facility costs, unexpected decline rates in wells, wells not performing as expected, delays resulting from or inability to obtain required third party and regulatory approvals, ability to access sufficient capital from internal and external sources, inability to access gas transportation and processing infrastructure, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, and the uncertainty of estimates and projections of production, costs and expenses. Although management believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance, and actual results or developments may differ materially from those in the forward-looking statements. The Company undertakes no obligation to update these forward-looking statements if management's beliefs, estimates or opinions, or other factors, should change. Please see the public filings of the Company at www.sedarplus.ca for further information and risks applicable to the Company.
