Helium One Global, the primary helium explorer in Tanzania with a 50% working interest in the Galactica-Pegasus helium development project in Colorado, USA ("the Galactica Project"), provides an update following the Blue Star Helium (ASX: BNL) ("Blue Star") announcement issued today regarding an update on the Jackson-4 L4 3154 development well.
Highlights
- Jackson-4 flowed naturally during drilling and at Total Depth ("TD")
- Flow rate measurements since drilling operations were completed have seen increasing natural flow increased to approximately 190 thousand cubic feet per day ("Mcfd")
- Projected stabilised flow rates expected to be between 250 to 350 Mcfd constrained to optimise production, with a maximum potential projected rate of 450 Mcfd
- Early gas samples have returned helium concentrations of up to 1.18% (not air corrected) and 85.93% CO2 in line with expectations
Jackson-4 Gas Sampling Analysis
The Jackson-4 well reached a TD at 1,260 feet (384m) within the Upper Lyons Formation, encountering the Lyons Sandstone Formation at 1,198 feet (365m).
As expected, no water was encountered during drilling of the Lyons Sandstone Formation with wireline logs confirming the penetrated Lyons Sandstone reservoir to be high-quality and gas saturated.
Flow testing since TD has revealed increasing natural flow rates, reaching approximately 190 Mcfd and strong pressure build-up post-testing indicates high permeability and good reservoir communication. Based on the previous engineering study described below, and the observed flow rates, the projected stabilised flow rates constrained for production optimisation are expected to be between 250 to 350 Mcfd, with a maximum of 450 Mcfd.
Initial laboratory analysis of gas samples from Jackson-4 showed a helium concentration up to 1.18% (not air corrected) and 85.93% CO2 (and 12.89% nitrogen) which is in line with expectations. Jackson-4 is one of the southernmost wells on the Galactica-Pegasus project and was anticipated to potentially access higher CO2 and lower helium concentrations than wells to the north and west.
Maintaining optimal plant throughput for beverage-grade CO2 production, requires a consistent CO2 feed. Therefore, high concentrations of CO2 are crucial to enable the necessary blending of input gas to achieve and maintain this optimal feed.
Jackson-4 Flow Testing Results
The Jackson-4 well reached a TD of 1,260 feet (384m), encountering the Lyons Formation at 1,198 feet (365m). The well was completed 62 feet (18.8m) into the Upper Lyons Sandstone Formation and wireline logs confirmed the penetrated Upper Lyons Sandstone Formation to be of high-quality and gas saturated.
The well exhibited natural gas flow during drilling and at TD. Flow testing has continued, with results demonstrating natural flow rates of approximately 190 Mcfd. Strong pressure build-up post-testing confirms high permeability and good reservoir communication.
Blue Star previously released results of an independent engineering analysis of wells in the Galactica-Pegasus project and this analysis established maximum stabilised rates and drawdown for development planning and economic modelling.
The analysis integrated results from the State-16 well with test data from the JXSN-1, JXSN-2, JXSN-3, and JXSN-4 discovery wells and compared it to public information from the adjacent Red Rocks development.
The study concluded:
o Calculated permeabilities in the JXSN discovery wells and State-16 well range from 300 to 750 millidarcies ("mD")
o This permeability range suggests initial flow rates at 6 pounds per square inch absolute ("psia") wellhead pressure of 334 to 780 Mcfd
o The State-16 well showed a calculated permeability of 405 mD in the Upper Lyons Sandstone Formation
o For State-16 (405 mD) stabilized initial flow rates constrained for production optimisation would be 250 to 350 Mcfd with a maximum of 441 Mcfd
Development planning includes considering vacuum compression ranging from 11 psia (-1 pounds per square inch gauge ("psig")) to 6 psia (-6 psig) wellhead pressure which provides the ranges above.
The Jackson-4 well has shown a natural flow rate of approximately 190 Mcfd which compares favourably to the State-16 well which showed a sustained natural flow rate of 150 Mcfd.
Given the higher natural flow at Jackson-4, due to greater permeability in the high-quality Upper Lyons Sandstone Formation, and the previous independent engineering study, projected potential stabilised flow rates, constrained for production optimisation, are expected to be 250 to 350 Mcfd with a maximum potential rate of 450 Mcfd.