Join our daily newsletter At The Bell to receive exclusive market insights
- Noble Helium (ASX:NHE) shares are up nearly 30 per cent in the first hour of trades
- The news follows high helium gas concentrations being hit at the company’s Tanzanian project
- A helium shortage is expected to carry on into early 2025, starting in 2022
- Shares last traded at 13.5 cents
Microcap helium explorer Noble Helium (ASX:NHE) was up nearly 30 per cent in early trades as the company reported hitting strong helium concentrations in drilling at North Rukwa.
All in all, helium was shown to comprise up to 2.46 per cent of sampled gas hit downhole.
These results came from its much-touted Mbelele prospect on-site, part of its larger Tanzanian North Rukwa helium play.
In the background, funding remains in place to complete all required early-stage works hereafter. Specifically, appraisals.
“We’re now planning additional appraisal of the Mbelele structure to sample and flow-test the gas gap as well as conducting a pilot program to flow test the helium-enriched fluids in the deeper reservoirs,” Noble Chairman Shaun Scott said.
“The Mbelele structure has very good helium concentrations contained within exceedingly thick, porous, permeable and stacked reservoirs.”
Wait. Drilling for helium?
For those out of the loop: most of the earth’s helium is extracted from underground reservoirs.
The gas, with applications broadly one-part-novelty and one-part-critical-tech, can be made artificially but it’s an expensive process. Most people just drill gas wells.
The world was recently thrown into a helium shortage during COVID (2022 to be precise) when two big outages at a US and Russian plant respectively led to, yet again, another shortage.
Industry publication Gasworld forecasted that a helium shortfall is set to last until the start of 2025.
Helium shortages happen relatively often compared to other commodity cycles given the nature of the projects which process helium. Read: there aren’t many.
Drill results discussion
The company reported helium concentrations near 2.5 per cent in gas were discovered in “highly permeable” reservoirs at Mbelele.
The full section of what could potentially be helium gas (“full section net reservoir”) was extended by over three times downhole Mbelele-1 to 148 metres and twofold to 271m downhole Mbelele-2.
These assumptions are based on post-drill petrophysics analysis.
Furthermore, hydrogen shows are up to 1500 times higher than background levels in the upper 350m of Mbelele-2. “Native hydrogen” deposits are rare, but, not unheard of.
“The hydrogen was an unexpected surprise which could provide significant additional upside and we plan to sample and test as part of the appraisal program,” Mr Scott added.
Why not?
Shares last traded at 13.5 cents.
