CALGARY, AB, Jan. 11, 2022 /CNW/ - First Helium Inc.
("First Helium" or the "Company") (TSXV: HELI) (FRA: 2MC),
today announced that it has delivered for sale over 1,100 barrels
of light crude oil, realizing over $90,000 in sales revenue for the Company.
"In December, First Helium delivered approximately 1,100 barrels
of light oil, produced during flow-testing of its 1-30 discovery
well. The sale of that oil signifies the first revenue and a
significant milestone for the Company as it continues with its
exploration and development of helium gas in the Worsley area," said Ed
Bereznicki, President & Chief Executive Officer of First
Helium. "Not only does 1-30 establish operating cash flow, but it
also has the potential to significantly increase the underlying
asset value of the Company," added Mr. Bereznicki.
Based on the production and field level netback assumptions
outlined below, First Helium management estimates annualized cash
flow of approximately $6 million,
which when capitalized at a typical industry field level cash flow
multiple of 3.0x, results in potential incremental market value of
approximately $18 million
attributable to the 1-30 well. In addition, the Company's
helium discovery well 15-25 was assigned an un-risked, "best
estimate" contingent resource NPV10 value of $15.2 million by Sproule Associates Ltd.,
independent evaluator, in a report dated March 31, 2021, referenced by First Helium in its
Final Prospectus dated June 28, 2021.
When considered together, these two assets alone indicate a
potential aggregate value of over $30
million, prior to giving consideration to First Helium's
extensive portfolio of prospective exploration opportunities.
Over the next month, First Helium anticipates that it will
complete construction and commissioning of an oil battery at 1-30,
including the installation of multiple storage tanks to mitigate
seasonal weather impacts, reduce downtime and allow tank treating
to minimize operating costs. The Company has procured all equipment
necessary for the construction of the oil battery and expects to
bring the 1-30 well into full production in early February.
First Helium expects to commence production of light oil from
1-30 at an estimated rate of 400 barrels per day, with expected
field netbacks of CA$45.00 to CA$50.00 per barrel based on a
current WTI price of US$68.00 to
US$73.00 per barrel, which is
anticipated to provide ongoing operating cash flow for the Company
in mid-Q1. In connection with its March year end, the Company will
commission an independent reserves evaluator to prepare an NI51-101
compliant reserve report for 1-30, including a net present value of
estimated oil reserves. Lastly, the Company will continue to
explore alternatives to maximize the value of 1-30 to further the
Company's helium exploration and development strategy.
ABOUT FIRST HELIUM
First Helium is a helium exploration and development company
operating in the Worsley area of
Alberta, Canada. In response to
the shifting supply dynamics of the global helium marketplace,
First Helium was founded to capitalize on the untapped potential of
significant helium resources in Western
Canada. Building on its successful 15-25 discovery well,
which has repeatedly production tested at over 1.3% of helium
content and 65% natural gas content, and its 1-30 oil success,
First Helium is working to develop its land base of over 79,000
acres along the highly prospective Worsley helium trend, and 276,000 acres of
select exploration option lands located in southeast Alberta, near existing helium operations. To
establish its operating base, First Helium seeks to market its
helium gas into the North American market via term off-take
marketing arrangements with established third-party distribution
companies.
For more information about the Company, please visit
www.firsthelium.com. The Company's final prospectus, financial
statements and management's discussion and analysis, among other
documents, are all available on its profile page on SEDAR at
www.sedar.com.
ON BEHALF OF THE BOARD OF DIRECTORS
Edward J. Bereznicki
President, CEO and Director
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX) accepts responsibility for the adequacy or accuracy of this
release.
FORWARD-LOOKING AND CAUTIONARY STATEMENTS
This news release contains certain statements or disclosures
relating to First Helium that are based on the expectations of its
management as well as assumptions made by and information currently
available to First Helium which may constitute forward-looking
statements or information ("forward-looking statements") under
applicable securities laws. All such statements and disclosures,
other than those of historical fact, which address activities,
events, outcomes, results or developments that First Helium
anticipates or expects may, or will occur in the future (in whole
or in part) should be considered forward-looking statements. In
some cases, forward-looking statements can be identified by the use
of the words "expect", "will" and similar expressions. In
particular, but without limiting the foregoing, this news release
contains forward-looking statements pertaining to the timing and
rate of production of the 1-30 discovery well; the timing of the
completion of the construction and commissioning of an oil battery
at 1-30; anticipated cash flows; the entering into of off-take
marketing arrangements; the use of funds and the Company's
strategy. The forward-looking statements contained in this news
release reflect several material factors and expectations and
assumptions of First Helium including, without limitation: that
First Helium will continue to conduct its operations in a manner
consistent with past operations; the general continuance of current
or, where applicable, assumed industry conditions; availability of
debt and/or equity sources to fund First Helium's capital and
operating requirements as needed; and certain cost assumptions.
Forward-looking statements are based on estimates and opinions
of management at the date the statements are made and are subject
to risks, uncertainties and assumptions, including those set out in
the Final Prospectus dated June 28,
2021 and filed under the Company's profile on SEDAR at
www.sedar.com. Readers are cautioned that actual results may vary
materially from the forward-looking statements made in this news
release. Risks that could cause actual events or results to differ
materially from those projected in forward-looking statements
include, but are not limited to, risks associated with the oil and
gas industry; the ability of First Helium to fund the capital and
operating expenses necessary to achieve its business objectives;
the impact of the COVID-19 pandemic on the business and operations
of First Helium; the state of financial markets; increased costs
and physical risks relating to climate change; loss of key
employees and those risks described in the Final Prospectus dated
June 28, 2021. First Helium does not
undertake any obligation to update forward looking statements,
except as required by applicable securities laws. Investors should
not place undue reliance on forward-looking statements.
SOURCE First Helium Inc.