The Helium One Global Ltd (LON: HE1) share price plunged 18.9% after issuing an update regarding the drill rig contract it had signed with SOFORI. Due to delays, the helium exploration and drilling company noted that Australia’s Noble Helium had pulled out of a similar contract with SOFORI.
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The primary helium company expressed its frustration with SOFORI over the continued lack of operational and contractual progress required under the terms of the non-binding Letter of Intent (LoI) signed by the two companies regarding the mobilisation of a drill rig.
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Noble Helium secured a Drillmec HH102 rig from Marriott Drilling Group (Marriott) of the UK, ensuring its first campaign at its North Rukwa Project in Tanzania proceeds as planned in Q3 2023. Noble and Helium One operate in neighbouring license areas at Rukwa in Tanzania.
Helium One confirmed that it was exploring other options if SOFORI does not fulfil the obligations outlined in the notice of rectification, which will still enable Helium One to meet its targeted drilling of the Tai-C well in Q3 2023. The company has sent a rectification notice to SOFORI.
The company revealed that it was evaluating the Drillmec HH102 Marriott rig as a viable option in case SOFORI fails to deliver its drill rig on time, according to the rectification notice. The company has already commenced civil works at its site to expedite the drilling campaign.
Lorna Blaisse, CEO of Helium One, Commented: “Whilst frustrating that a definitive contract has not been signed, we continue to work with SOFORI with a view to fulfilling their obligations under the LoI. In the meantime, we have commenced our civils work at site in order to ensure we can expedite drilling Operations as soon as possible once we have a rig secured.”
Noble Helium’s CEO and Co-founder, Justyn Wood, commented: “The ongoing delays with Sofori’s rig forced us to consider other options, and fortunately, an identical Drillmec HH102 became available with Marriott, a highly experienced UK-based drilling company. Marriott brings significant expertise in oil and gas exploration, appraisal and development drilling, including recent exploration drilling in Northern Kenya.”
*This is not investment advice.
Helium One (HE1) share price.
The Helium One share price plunged 18.92% to trade at 4.50p, from Thursday’s closing price of 5.55p.
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