GRAND GULF ENERGY LIMITED Red Helium Project Update
April 2022
Corporate Disclaimer
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Shareholders should not rely on this presentation. This presentation does not take into account any person's particular investment objectives, financial resources or other relevant circumstances and the opinions and recommendations in this presentation are not intended to represent recommendations of particular investments to particular persons. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments.
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This presentation may include forward looking statements. Forward looking statements are only predictions and are subject to risks, uncertainties and assumptions which are outside the control of the Company. These risks, uncertainties and assumptions include commodity prices, currency fluctuations, economic and financial market conditions in various countries and regions, environmental risks and legislative, fiscal or regulatory developments, political risks, project delay or advancement, approvals and cost estimates.
Actual values, results or events may be materially different to those expressed or implied in this presentation. Any forward looking statements in this presentation speak only at the date of issue of this presentation. Subject to any continuing obligations under applicable law and the ASX Listing Rules, the Company does not undertake any obligation to update or revise any information or any of the forward looking statements in this presentation or any changes in events, conditions or circumstances on which any such forward looking statement is based.
Competent Person's Statement
The information in this report is based on information compiled or reviewed by Mr Keith Martens, consulting geologist/geophysicist to Kessel Resources. Mr Martens is a qualified oil and gas geologist/geophysicist with over 45 years of Australian, North American and other international executive oil and gas experience in both onshore and offshore environments. He has extensive experience of oil and gas exploration, appraisal, strategy development and reserve/resource estimation. Mr Martens has a BSc. (Dual Major) in geology and geophysics from The University of British Columbia, Vancouver, Canada.
Red Helium Project
Strategic Pivot to Pure-play Helium Exploration Project
Prolific Location
• Helium-Prolific Four Corners area
• Drill Friendly Utah
• 250,713 acre AMI, > 29,000 gross leased
• Proximal to dedicated infrastructure
• 20 miles to 2 of 8 US helium plants
• Pipeline connected to Lisbon helium plant
• Mar '22 Helium Offtake Agreement
• Helium Price ~$605/mcf
• Mar '22 Strategic Alliance
De-Risked Geology
• Known Geology, 315km quality 2D seismic
• Vintage wells within AMI proved:
• Trap, Seal, Reservoir Presence, Gas Charge, Helium system within AMI
• 4 independent prospects with 2 drill ready locations and deeper under-explored potential
• Jesse#1A Key Objectives:
• Helium Presence / Concentration
• Reservoir Effectiveness / Flowrates
Large Resource
• Red Structural Closure
• 4 - 5 times Doe Canyon
• Doe Canyon Analog, 15 miles to East
• 3 - 5 bcf anticipated helium production
• High rate gas wells: Avg. IP ~20mmcfd
• Average helium grade ~0.4 - 0.5% with upside
• = high helium flow rates
• Dec'21 Maiden Helium Prospective Resource
• Gross P50 unrisked 10.9bcf1
Commitment to Project Delivery & Monetisation: Fully Funded for at least 2 Exploration Wells and Strategic Opportunities / Acquisitions2
Sep '21
Acquisition
1 ASX announcement 8 December 2021, Maiden Prospective Resource, based on Sproule Report, detailed in Slide 4. 2 ASX announcement 20 April 2022, $11m placement, before costs
Corporate Snapshot
US-Focused Helium Explorer with positive Energy production cashflow
** Options and 30 million performance rights subject to SH approval
OTCQB Listing: North American (NA) Visibility
OTC enhance visibility / accessibility of the company to NA shareholders and media partners.
The estimated quantities of helium that may potentially be recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal is required to determine the existence of a significant quantity of potentially moveable helium.
De-risked asset base
Assets have existing wells with Helium present and extensive 2D seismicLow-cost exploration Multiple Drill Ready Targets: Future wells ~US$3.3m
Carbon market exposure
45Q Tax Credit upside through CO2 sequestration potential
Robust netbacks
Skilled executive team
Access to capital
Low breakeven and low production costs with high torque to commodity prices
Management brings track record of North American asset development
ASX/OTCQB listing expands investor base, provides exposure to international capital
1 Well cost overrun shared at earned WI split.
2 ASX announcement 8 December 2021, Maiden Prospective Resource, based on Sproule Report. The Company is not aware of any new information or data that materially affects the information included in the referenced
ASX announcement and confirms that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed.
Financial Information | |
ASX Trading Symbol | GGE |
Total Shares | 1,546 million |
Market Cap @ 4.7c | A$72.7 million* |
Net Cash @ 31 Dec 2021 | A$3.0 million |
Performance Shares/Rights | 165 million** |
Options (3 years at 2.5 cents each) | 60 million |
Options (3 years at 7.0 cents each) | 10 million** |
Options (3 years at 8.0 cents each) | 103 million** |
* Market Cap includes placement shares |
Red Helium: Earning 85% of Valence1 | Earning | Max Cost $US |
Current Interest | 55% | |
Drilling first well by Oct '22 | 15% | $1.5M |
Drilling second well by Oct '23 | 7.5% | $1.5M |
Drilling third well by Oct '23 | 7.5% | $1.5M |
Total Payments Remaining | 85% | $4.5M |
Recoverable Helium (bcf)2 | P90 (1U) | P50 (2U) | P10 (3U) |
Gross to Valence (28,046 gross acres) | 7.6 | 10.9 | 12.9 |
Net to Valence (18,959 net acres) | 5.2 | 7.4 | 8.5 |
Net to GGE (earning 85% of Valence) | 4.4 | 6.3 | 7.2 |
Red Project Total | 7.9 | 20.8 | 57.6 |
Helium: Critical Path Irreplaceable Technological Enabler
Major growth predicted in most usage areas, particularly: Space, Medical, Semiconductor and Fibre Optics
Helium Usage by
Inert
Industry
Forecast helium consumption by industry 2021 - 2030E (bcf/y)
Doesn't react with other elements and non-flammable unlike hydrogen
Non-toxic
Can be used in many applications without posing health or wellness risks
Lighter than air
Ability to lift or float. Atmospheric molecules escape to space
Boiling point -269°C
9 8 7 6 5 4 3
Liquid at ultra cool temperatures enables superconductivity
2
High Thermal Conductivity Removes heat in space applications and electronics manufacturing
1 0
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Small molecular size
Can be used to find the smallest of leaks
MRI/NMRWelding/CuttingDiving
LiftingFibre OpticsOtherLaboratory/SpaceLeak DetectionSemiconductorsMilitary & Space
Source: H&P Equity Research / Akap Energy estimates Feb 2022
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Grand Gulf Energy Limited published this content on 25 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 April 2022 23:59:10 UTC.
