Oilman Jim's Letter - 4 February 2024

Pulsar Helium (PLSR.V PSRHF Y3K.F) announced that mobilisation of the Capstar drill rig is currently underway. Drilling of the Jetstream #1 appraisal well is expected to begin February 2, located within 20m of the original LOD-6 discovery well. The conductor has already been installed, utilising a smaller rig that has since demobilized from the site. Drilling and well testing is anticipated to be completed within one month inclusive of a comprehensive open-hole wireline logging suite acquired by Baker Hughes. Following rig release, a well testing package will mobilise to site to conduct flow testing and pressure build-up operations. The land was originally drilled in 2011 as a mineral exploration borehole and helium-rich gas was intersected by chance. It flowed 10.5% helium, with only trace hydrocarbons present.

88 Energy (88E.AX EEENF 88E.L) announced its quarterly report. In Q1 2024, a 20% working interest in PEL 93 (an 18,500 sq km onshore permit in the Owambo Basin of Namibia) is anticipated to be transferred to 88 Energy following approval by the Namibian Ministry of Mines and Energy. Per 88E, PEL 93 provides exposure to a first-class operating jurisdiction and one of the last frontier oil and gas regions capable of delivering multi-billion barrel discoveries. Meanwhile, the Hickory-1 discovery well flow test and well stimulation program is set to commence mid-February, following ice road construction, pad construction and rig mobilisation. The budget of US$11 million gross now is fully funded. The Slope Fan System and Shelf Margin Deltaic are the two primary test targets and the results will also be of interest to Pantheon Resources (PANR.L PTHRF P3K.F), which holds adjoining acreage.

Baron Oil (BOIL.L GHA.F) announced that following approval by Timor-Leste's National Petroleum Authority, the condition precedent has been satisfied and the farm-up agreement between Baron's wholly owned subsidiary, SundaGas, and TIMOR GAP in relation to the Chuditch PSC has now become unconditional. Baron’s directors consider that the farm-up has a value to the company of approximately US$8.5 million made up of a reimbursement for back costs of around US$1 million and the offset of future spending which in 2024 is estimated to be around US$7.5 million. The operational plan remains to drill and flow test the Chuditch-2 appraisal well in late 2024, subject to rig and drilling services availability and the completion of drill financing. The cost of the Chuditch-2 appraisal well is anticipated to be approximately US$32 million, including the costs of a full production flow test. Baron is responsible for 80% of the costs and financing will be required.

Pantera Minerals (PFE.AX PTMLF ) announced the establishment of a conceptual exploration target at the Superbird lithium brine project. The target ranges from 0.436 to 2.96 million tonnes of contained lithium carbonate equivalent within the project’s exclusive abstract area. The estimate is based on lithium concentrations with a median value of 338mg/L, which the company says showcases the potential world-class scale of the project. Pantera has formally entered into a binding implementation agreement to acquire 100% of the issued share capital in Daytona Lithium, the holder of the 12,500 acre Superbird lithium project, which is situated in the South-West Arkansas Smackover, a renowned high-grade brine formation.

Europa Oil & Gas (EOG.L EGN.F) announced that it has received notification from the Irish Government's Department of the Environment, Climate and Communications that the Minister has given his consent to extend Phase 1 of FEL 4/19 to 31 January 2026. The company intends to use the extension to carry out further technical studies and try to secure a partner to advance development of the licence. FEL 4/19 contains the 1.5 trillion cubic feet Inishkea West gas prospect. News last month was the acquisition of a 42.9% equity interest in Antler Global, which holds an 80% working interest in the EG-08 production sharing contract, offshore Equatorial Guinea. The company believes it already has drill-ready prospects with estimated total prospective resources of 1.4 trillion cubic feet of gas equivalent.

Finder Energy (FDR.AX) announced its quarterly report. It successfully bid in the 33rd UK Offshore Licensing round for the P2610 licence containing the large Boaz gas/condensate prospect with mean prospective resources of 748 billion cubic feet of gas and 81 million barrels of condensate. Finder is partnered with Equinor, the operator of nearby Sleipner Area facilities, providing a pathway for development and access to strong European gas prices. The company also announced during the quarter a mean prospective resource estimate of 150 million barrels for the Whitsun prospect in P2528. Whitsun is an analogue to the nearby giant Buzzard Field and Finder has opened a data room to attract a partner for the Whitsun exploration well.

Chariot (CHAR.L OIGLF C62.F) announced an operational update. Onshore Morocco, the first drilling campaign of two wells on the Loukos licence is on track to commence around the end of Q1 2024. Planning activity is well advanced and a contract has been signed with Star Valley Drilling for provision of the 101 rig which is already operating in country. Imminent approval is expected of the environmental permit for up to 20 well operations across the licence area, allowing flexibility and efficient planning of future campaigns. The Gaufrette prospect has been confirmed as the first drilling target and success will potentially unlock multiple similar prospects totalling 26 billion cubic feet of best estimate recoverable prospective resources. The Dartois prospect has been high-graded as the most likely second drilling target and has the potential to unlock a trend of prospects with over 20 billion cubic feet of total best estimate recoverable prospective resources. Work is continuing with on success-case fast-track industrial commercialisation opportunities, with the possibility to deliver near-term cash flows.

Royal Helium (RHC.V RHCCF RD31.F) announced that it has been approved to be a recipient of a contribution of C$3 million from the Government of Canada under its Aerospace Regional Recovery Initiative. This results from the offtake agreement that the company has signed with a space launch company in North America. Royal is Canada’s first publicly listed helium producer with over 1 million acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta, Its helium reservoirs are carried primarily with nitrogen, deeming it “green” unlike many operations that rely on natural gas production for helium extraction.

Finally, Melbana Energy (MAY.AX MEOAF) announced an update for Alameda-3 drilling, onshore Cuba. Flow testing of Unit 3 of the Amistad reservoir has been completed satisfactorily and all objectives met. The presence of moveable oil of similar quality and reservoir conditions as that observed while testing the same unit in Alameda-2 has been confirmed and no formation water was observed during testing. The company now is preparing to drill ahead to test the deeper Alameda and Marti reservoirs discovered in 2022 that have been independently estimated to contain a combined 179 million barrels of prospective recoverable resources.

More in the Private and International letters this evening.

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