By Daily News Reporter and Agencies
Helium One has set out plans to list on London's AIM to finance its drilling plans in Tanzania, where it believes it has a world-scale resource.
Tanzania-focused Helium One aims at landing on London's AIM on December 3 via a reverse takeover of cash shell Attis Oil and Gas.
Helium One's CEO David Minchin said the plan was to raise £5.0 million for the drilling, which designed to take off in the first half of next year and production may start in 2023-2024.
"The listing now is to raise £5 million to mobilise the rotary lie detector," Mr Minchin said.
The company plans to drill in the first or second quarter of 2021.
"It's great in concept. We just need to make discoveries. We've done all we can now," Mr Minchin was quoted as saying.
The company expects to hold a resource of 138 billion cubic feet for a Rukwa project. At $280 per mcf, that's $36 billion.
"We're one of the only companies with this size of strategic resource in the world, and we'll be the only company on AIM in the exciting and expanding helium space," Helium One's CEO said.
The company received its Tanzania licences in 2015.
Since then, the company has collected and reprocessed 1,000 km of original seismic, flown a high gravity seismic survey and conducted a micro and macro analysis of seeps.
The company had planned to list on the Australian stock exchange, but then Covid-19 derailed this plan.
"In Australia, it's harder to secure investment in Africa. London is a natural place for our plans and it's a good place that understands investments in Africa," he said.
"Helium One will drill three wells to a maximum depth of 1,200 metres. Each well should take a month to complete and the company is in negotiations with contractors. The company can make savings as a result of the downturn."
Success in the first wells will see Helium One move to appraisal drilling and 3D seismic to understand trap geology fully.
"In 2022, we will be looking for equity for the construction and then it will take around a year to build. We can be producing in 2023-24," Mr Minchin said.
The company will construct a $50 million production plant from modular components. The company will export helium as a liquid in an ISO container, via Dar es Salaam.
Tanzania has thrown up some challenges for companies, but Mr Minchin was optimistic.
"We've seen Tanzania turn around in the last six months," he said as he noted Barrick Gold's award of more exploration licences in the country. "Tanzania is open for business and this is the time to be involved."
The state approved the renewal of Helium One's exploration licences in September.
Scirocco Energy voiced its support of Helium One's plans with Attis. Scirocco, formerly known as Solo Oil, has a 12 per cent stake at Helium One. The launch of AIM will cut Scirocco's stake to 4.6per cent.
Tom Reynolds, CEO of Scirocco, said the deal with Attis was a positive development for Helium One and set it up to deliver material growth.
"Valuation reads across highlights challenging market conditions at this time, but in our view, it's far more important that we now have exposure to a very exciting story with a listing on a recognised exchange," he said.
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