Oilman Jim's Letter - October 19, 2024

Pulsar Helium (PLSR.V PLSR.L PSRHF Y3K.F) announced that its common shares have commenced trading on the AIM market of the London Stock Exchange. The admission follows successful completion of the fundraising of £3.875 million (C$7 million) before expenses. Total gross funds raised by the company pursuant to the fundraising and the £1.125 million pre-IPO cornerstone investment therefore amount to £5 million. The company's common shares will continue to be listed and traded on the TSX Venture Exchange in Canada and the OTCQB Venture Market in the United States. Net proceeds of the fundraising are expected to be used primarily to accelerate the development of the company's Topaz helium project in Minnesota through undertaking further drilling to deepen the Jetstream #1 well, acquire further seismic studies and complete a preliminary economic assessment…more

Woodside Energy (WDS.ASX WDS WDS.L WOP0.F) announced that the company has decided to delist from the London Stock Exchange. Delisting from the LSE will reduce Woodside's administration costs it says. The last day of trading of Woodside shares on the LSE will be 19 November 2024. The company’s primary listing on the Australian Securities Exchange and its American Depositary Receipts program on the New York Stock Exchange will not be affected. The simultaneously released third quarter report recorded quarterly production of 53.1 million barrels of oil equivalent (577,000 barrels of oil equivalent per day), up 20% from Q2 2024 due to ramp-up of Sangomar, increased uptime across operated assets including 99.9% LNG reliability at Pluto and increased seasonal domestic gas demand. Full year production guidance has been narrowed to 189-195 million barrels of oil equivalent. Quarterly revenue was $3,679 million, up 21% from Q2 2024…more

Deltic Energy (DELT.L 7RC0.F) previously stated that it intends to limit further investment in its UK portfolio and will look to pursue opportunities overseas in jurisdictions that are more favourable and supportive of the oil and gas industry. The latest is that Graham Swindells has informed the board of his intention to step down as CEO effective immediately and will be succeeded by Andrew Nunn, the company's current COO. Per the new Chief Executive Officer, Deltic anticipates shortly announcing a series of measures to reduce the company's overheads and will then look further afield to find value for shareholders…more

Union Jack Oil (UJO.L UJOGF 1UJO.F) responded to media speculation regarding the planning permission for further development of the Wressle well site, confirming that it is aware of a letter that has been addressed to North Lincolnshire Council, informing the council of an intention to challenge its decision to grant planning permission for an extension to the Wressle well site, long term oil and gas production and construction of an associated pipeline at Wressle. Subsequently, the council confirmed that following receipt of legal opinion and in light of the Finch Supreme Court decision, it will not seek to resist the proposed legal challenge and the planning consent is expected to be quashed. Union Jack already started deploying its investment capital outside the UK earlier this year…more

TAG Oil (TAO.V TAOIF TOP.F) announced that production from the BED4-T100 horizontal well is averaging 200 barrels of fluid per day, 35 percent water. The well is now equipped with a sucker rod pump for long term stable production. Cumulative oil production of the well to date is in excess of 15,000 barrels and shipments have commenced to third party facilities. With the successful proof of concept of producing commercial oil volumes from the unconventional Abu Roash “F” reservoir in the BED-1 concession, current development plans include returning the previously completed and produced BED1-7 vertical well to production following an extended pressure build-up analysis. The well will be set up with a sucker rod pumping system, similar to the T100 well during the fourth quarter. In addition, several new drilling locations have been identified for an additional one or two vertical wells in Q1 2025 targeting high intensity natural fractured areas that can potentially produce at good initial oil volumes. Planning of a second horizontal well is also underway and is planned for drilling in Q2 2025. Further announced was receipt of a “No Objection Letter” approval from an industry operator in Egypt to the company’s proposal to acquire a significant interest in their concession in the Western Desert of Egypt. TAG engaged in evaluating the concession earlier this year and submitted a binding proposal in the second quarter. The farm-in agreement contemplates standard farm-in terms and is subject to certain conditions and other regulatory approvals. The target concession covers an area of approximately 2,000 sq km (512,000 acres), nearly 20 times larger than the 26,000-acre BED-1 concession. Of specific interest is the unconventional ARF oil formation that is present covering a large portion of the targeted concession with indications of good ARF reservoir properties, similar to the BED-1 concession, which has estimated oil initially in place of 532 million barrels assigned to the ARF unconventional resource play. Completing this acquisition will add immediate conventional production and upside in proven reservoirs…more

Blue Star Helium (BNL.ASX BSNLF) announced an update on helium development well permitting at its Galactica/Pegasus helium project in Las Animas County, Colorado. The Colorado Energy and Carbon Management Commission has approved five new proposed helium development well locations (Jackson 27 SWSE, Jackson 31 SENW, Jackson 29 SWNW, Jackson 2 L4 and Jackson 4 L4) at the Galactica/Pegasus project. These wells are located to the south and southwest of the successful State 16 well toward the proposed Galactica plant site and are expected, together with State 16, to form part of the initial gas gathering into the Galactica helium production facility which the company is developing with its farm in partner, Helium One Global (HE1.L HLOGF HE1.F). This approval satisfies a key condition precedent to the Helium One farm out agreement. Drilling is to start Q4 2024, subject to Form 2 approval…more…more

Helium Evolution (HEVI.V HEEVF) announced that its partner, North American Helium, has secured licenses to drill two joint wells (7-2 and 3-19) in the Mankota area of southern Saskatchewan. Both are considered delineation wells designed to further assess the reservoir potential in the area. The 7-2 well, which is anticipated to be drilled first, offsets the 9-35 discovery well, which was drilled in the first quarter of 2024. The 9-35 well flow tested at approximately 7 million standard cubic feet per day and 9,000 kiloPascals flowing tubing pressure during the six-day extended flow period. The gas composition of the well is 0.64% helium and 96.7% nitrogen, with the balance comprised of fractional percentages of minor component gases. A post-flow pressure transient analysis on the 9-35 well revealed no reservoir pressure depletion or reservoir boundaries, highlighting a potentially expansive and productive reservoir. The analysis also calculated an absolute open flow potential of 13.3 million standard cubic feet per day. Helium Evolution says it is working closely with North American Helium to secure licenses for the remaining seven wells in its drilling program, which is set to unfold this fall and winter…more

Gold Hydrogen (GHY.ASX GHYLF) announced an operational update on the company’s Ramsay project on the Yorke Peninsula. Results achieved to date confirm that the project has significant potential to be a commercially attractive natural hydrogen and helium producer. CSIRO reporting and data confirms the highest helium purities ever sampled in groundwater in Australia, ranging from purity levels of 20% to 25%. The helium flow testing program has confirmed helium to surface, with helium content increasing as the hole stabilized and purity levels were sampled up to 36.9% at the well head during testing. Drill analysis identified a potential 180 metres thick and extremely high-purity Kulpara Dolomite zone which featured positive Helium shows in the Stage 1 exploration well testing of Ramsay 2. 2D seismic survey results indicate further optimal locations across a regional play for future drilling for both natural hydrogen and helium. The company now is preparing new drilling and exploration designs to optimize the extraction of both natural hydrogen (1.3 billion kilogrammes best estimate prospective resource) and helium (41 billion cubic feet best estimate prospective resource) for its next drilling campaign…more

First Helium (HELI.V FHELF 2MC.F) announced a non-brokered private placement financing of 41,666,667 units at a price of C$0.06 per unit for aggregate gross proceeds of C$2.5 million. Each unit will be comprised of one common share and one common share purchase warrant exercisable at a price of C$0.09 cents per share for a period of 36 months from the date of issuance, subject to an acceleration clause. As part of the private placement offering, the company has received lead orders from a key insider and another significant shareholder totalling C$2 million. Other members of the company’s management team will also participate. The company intends to use the net proceeds from the offering to fund additional asset development and operating expenses on its Worsley project, as well as for general working capital. First Helium holds over 53,000 acres along the Worsley Trend in Northern Alberta. Following the 15-25 helium discovery, the company has identified numerous follow-up drill locations and acquired an expansive infrastructure system to facilitate future exploration and development across its land base. Cash flow from its oil wells at Worsley has helped support First Helium's ongoing exploration and development growth strategy and further potential oil drilling locations have also been identified…more

Vintage Energy (VEN.ASX) and Galilee Energy (GLL.ASX) announced they have entered into a binding scheme implementation deed under which Vintage will acquire all of the fully paid ordinary shares in Galilee by way of a scheme of arrangement under which Galilee shareholders will receive two fully paid ordinary shares in Vintage for every one fully paid ordinary share in Galilee. Existing Vintage shareholders will hold approximately 60% and existing Galilee shareholders 40% of the merged group. Per Galilee’s Executive Chairman, Ray Shorrocks, there is a huge opportunity emerging in Australia’s east coast gas market and this merger is aimed at enabling the combined companies and their shareholders to take full advantage of the looming gas shortfall and the impact that will have on gas prices, margins and free cashflow generation.

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