SASKATOON, SASKATCHEWAN / ACCESSWIRE / November 20, 2017 / RHC Capital Corporation (TSX-Venture: RHC) ("RHC" or the "Company"), is pleased to announce that it has commenced operations on its first helium well near Benegough, Saskatchewan.
Initial Well
The initial well is the re-completion of an existing vertical wellbore that has been drilled to the target reservoir depth. Operations have commenced and the re-completion is expected to take approximately 10-15 days. Once completed, production testing will occur over the two primary zones of interest. Production testing will run in sequence, beginning with the lower zone, and take approximately 30 days to complete in total. Pending production results, temporary production equipment will be brought on-site while plans for a more permanent facility continue to be evaluated.
Evaluating Results
RHC's assets are associated with some of the the highest known historical helium concentrations in Saskatchewan. Significant primary helium production wells can expect to see helium concentrations range from 0.70% and 1.10% of the total raw gas produced. As part of RHC's production testing, helium concentration tests will be sent to multiple labs for analysis. RHC's initial well has a historic gas analysis test in the upper target zone showing 1.41% helium.
About RHC
RHC operates through its wholly owned subsidiary Royal Helium Corp. the largest helium leaseholder in Canada. To date, RHC is the first and only company focused on primary helium production, listed on a Canadian stock exchange. RHC's assets were methodically evaluated for their helium potential for over two years and have been vetted by helium experts, professional geologists/engineers, and major industry participants.
Helium Market
The current global market is estimated to be ~8 Billion Cubic feet ("cf") annually, with the price of bulk liquid helium rising by more than 100% in the past ten years. Pricing information is generally determined through private contracts for both liquid and gaseous forms (1 lb of Liquid He is approximately 96.65 cf at 1 atm), though liquid helium tends to sell at a significant premium to the gaseous equivalent volume. The US Bureau of Land Management (BLM) does, however, post recent and historical auction results for crude helium sales from its reserves (https://www.blm.gov/programs/energy-and-minerals/helium/federal-helium-operations). A recent BLM auction (July 19, 2017) for 2018 helium allocations were released with helium priced at $112-$125USD/Mcf. In 2013 the BLM announced that it would begin to auction off the reserve annually until it declined to 3.0 billion cubic feet. Depletion to this level is estimated to occur before 2021 at that point the reserve would only supply U.S. government users which would remove a significant portion of existing capacity from the world market.
With approximately 60% share of global supply in 2015 (reserves found mostly in natural gas fields) the USA is the world's leading helium supplier, followed by Qatar with ~25% (USGS). Algeria, Australia, Canada, Poland, and Russia are also producers.
Applications
Helium acts as a cooling medium for superconducting magnets in MRI scanners, NMR spectrometers and other areas of scientific research. Helium has also been used to keep satellite instruments cool and is essential for space travel and rocketry. Helium is often used to fill party/weather balloons, and airships because of its low-density. Hydrogen was once used for this application, but it is dangerously reactive. Due to its unreactive nature, helium is used to provide an inert protective atmosphere essential for making fiber optics and semiconductors and for arc-welding various metal. Helium has applications in leak detection, such as in car air-conditioning systems and gas pipelines. Some gaseous helium mixtures are used to treat respiratory ailments in healthcare applications, and helium is also used in various laser applications.
For further information, please contact:
RHC Capital Corporation (Royal Helium Corp.)
Michael Graham, Chief Financial Officer
Tel: (647) 778-6946
Email: [email protected]
www.royalhelium.com
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FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements, within the meaning of applicable securities legislation, concerning RHC's business and affairs. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "intends" "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".
These forward-looking statements are based on current expectations, and are naturally subject to uncertainty and changes in circumstances that may cause actual results to differ materially. Although RHC believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that these expectations will prove to be correct. There are risks which could affect RHC's future results and could cause the results to differ materially from those expressed in these forward-looking statements.
SOURCE: RHC Capital Corporation