Key points:
- Helium One shares rallied 10.7% after completing the drill rig audit.
- Investors cheered the move that paves the way for phase II drilling.
- However, the Rig must now be transported from Kenya to Tanzania.
The Helium One Global Ltd (LON: HE1) share price rallied 10.7% after announcing the completion of the Rig Audit, which was being conducted by Aberdeen Drilling Consultants (ADC) on its preferred drill rig in Kenya.
Investors cheered the news, as evidenced by the rally in Helium One shares since the announcement indicates that the Rig is now ready for use at the company’s Rukwa Helium project in Tanzania once it is transported to the site.
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The drill rig will be used for phase II drilling, which the company hopes will uncover significant helium deposits it can extract and sell. The project was initially billed as one of the world’s most extensive and least costly helium reserves. Still, phase I drilling results were disappointing, triggering a decline in Helium One shares.
The helium company told investors the audit included a detailed examination of the entire Rig and its associated systems. In addition, a final endurance test was conducted, which required eight hours of operation at over 2,000 Psi.
Helium One noted that the drill rig was an Epiroc Predator 220 drilling rig with a 950 horsepower powertrain and 100T mast rating capable of drilling an 8.5” hole to 2500m. Therefore, the Rig is more than capable of testing targets at Tai, where it has identified stacked closures with a maximum depth of 1300m
The company has contracted Baker Hughes, a tier-one energy contractor, to provide integrated services during the phase II drilling campaign, including cementing, drilling fluid, downhole gas sampling and wireline evaluation services.
David Minchin, Chief Executive Officer, commented: “We are delighted to report the completion of the ADC audit over our preferred drilling rig at its yard in Kenya. The audit has allowed a complete assessment of the Rig’s operational capability culminating in a successful high-pressure endurance test that required all systems on the Rig to operate together under more than 2,000 Psi pressure load for a period of eight hours. The in-depth audit completed by ADC has delivered significant value to the company, flagging issues that had the potential to cause considerable cost and delay if only identified later in the field.”
*This is not investment advice.
The Helium One share price.
Helium One shares rallied 10.66% to trade at 6.75p, rising from Friday’s closing price of 6.10p.
