Highlands Natural Resources PLC Definitive Helios Two Gas Analysis Results (2506V)
27 January 2017 - 3:30AM
UK Regulatory
TIDMHNR
RNS Number : 2506V
Highlands Natural Resources PLC
26 January 2017
26 January 2017
Highlands Natural Resources plc ('Highlands' or 'the
Company')
Definitive Helios Two Gas Analysis Results
Highlands Natural Resources, the London-listed oil and gas
company, is pleased to announce that gas analyses performed at two
independent gas laboratories has confirmed the presence of 0.31% to
0.33% helium at the Company's Helios Two Natural Gas and Helium
Project in Montana, USA.
Highlights
-- Results from two samples strengthen the Board's belief in the Project's helium viability
-- The results are similar to the concentrations of helium
exploited at other major helium operations including the Hugoton
Field in Kansas and Texas, the USA's largest helium resource
-- Optimised testing methodology has led to this more definitive
understanding of the helium concentration
-- Next steps are aimed at assessing the full-scale gas
production rates and economics - focused on drilling a disposal
well and accelerating the de-watering process
-- To be undertaken when the snow has thawed to create operational efficiencies
-- Natural gas already known to be present at Helios Two and
apportioned an NPV(10) of US$341m by RPS Knowledge Reservoir,
LLP
-- Testing has also highlighted methane concentrations of 90%
Highlands CEO Robert B. Price said, "I am happy to provide the
market with conclusive evidence that helium is present in elevated
concentrations at Helios Two. Given the scale of Highlands'
105,000+ acre land holdings in the Helios Two project area, these
results are potentially very significant as they may point to a
meaningful accumulation of helium as well as an important natural
gas field. We are now focused on understanding the commerciality of
this and our next step is to drill a disposal well and to
accelerate the de-watering process to assess full-scale gas
production rates and economics.
"Upon completion of the disposal well and commencement of
full-scale de-watering, Highlands' technical teams expect they will
be able to verify the commercial potential of de-watering in the
Muddy Formation of Helios Two in H2 2017. If full-scale de-watering
proves successful, Highlands would be in the position of having
substantially de-risked Helios Two from a scientific, technical and
operational perspective. At that point, Highlands would accelerate
commercial partnerships towards scale-up and full field
development."
Further Information
Today's results build on those previously announced on 27 June
2016. Previous testing was conducted on several preliminary gas
analyses which were collected using hard plastic sampling tubes and
IsoFlasks. These samples were analysed at multiple gas
laboratories, and uniformly showed that the preliminary sampling
techniques and equipment had allowed for varying degrees of
atmospheric contamination and potential helium leak-off. Helium is
a very small molecule, and is well known for its ability to escape
containment; pressurized gaseous helium is even able to escape
through many metal containers.
As a result, Highlands procured laboratory grade steel sampling
canisters in January 2017, and collected a series of gas analyses
under the instruction of gas analysis professionals. Two such
samples were collected and expedited to two separate gas
laboratories. Highlands has now received final gas analysis
reporting from the two laboratories showing the following
results.
These concentrations of methane and helium are in line with
Highlands' initial expectations for the Helios Two project, and are
similar to the concentrations of helium exploited at other major
commercial helium projects including the Hugoton Field in Kansas
and Texas. The Hugoton Field is the USA's largest helium resource,
and has historically supplied approximately two thirds of the
domestic helium supply via infrastructure operated by the Bureau of
Land Management. That infrastructure as well as the associated
helium reserves are now expected to be decommissioned and depleted
by 2021, creating a potentially significant demand for replacement
sources of domestic helium in the United States. As a result,
helium prices have risen to US$107 per mcf (approximately 3,050%
more valuable than methane, which trades for US$3.50 per mcf) in
the most recent government helium auctions. Private helium
transactions are reported to achieve significantly higher
prices.
THIS RELEASE CONTAINS INSIDE INFORMATION.
**ENDS**
For further information, please visit www.highlandsnr.com, or
contact:
Highlands Natural +1 (0) 918 361
Robert Price Resources plc 7000
Cenkos Securities +44 (0) 131 220
Nick Tulloch plc 9772
+44 (0) 131 220
9771 /
Cenkos Securities +44 (0) 207 397
Neil McDonald plc 1953
St Brides Partners +44 (0) 20 7236
Lottie Brocklehurst Ltd 1177
St Brides Partners +44 (0) 20 7236
Elisabeth Cowell Ltd 1177
Notes to Editors
Highlands Natural Resources (LSE: HNR.L) is a London-listed
natural resources company with a portfolio of high-potential oil,
gas and helium assets and technologies. The company's core projects
include:
-- East Denver Niobrara: a farm-in opportunity for horizontal
oil and gas wells targeting the Niobrara shale formation in a
well-studied area of the Denver Julesburg Basin.
-- DT Ultravert: a re-fracking and parent well protection
technology with 20 patents pending in the United States and
internationally. Highlands is advancing commercial conversations
with a range of oil and gas operators to create revenue-sharing
opportunities for DT Ultravert applications.
-- Helios Two: a 105,000+ acre helium and natural gas prospect
in SE Montana with drilling and assessment operations ongoing.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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