Dec 06, 2021 (Baystreet.ca via COMTEX) -- We are right now in the early stages of a red-hot bull market for one often-overlooked natural resource.
Soaring demand for this commodity – at a time when we’re facing a critical shortage – has created an explosive growth opportunity for those investors who know where to look.
This opportunity is in helium.
A resource that has for decades been thought of only as part of a child’s birthday balloon is actually one of the world’s most critical – and irreplaceable – commodities.
And right now we’re on the verge of a critical shortage.
Making matters worse is that, thanks to a combination of factors, there have been virtually no companies exploring for new sources of helium until very recently.
This opportunity is so potentially lucrative that an expert collaboration of natural resource veterans has come together to develop projects with extraordinary potential.
This Team Led Development on One of North America’s Largest Oil & Gas Discoveries...and Now They’re Seeking to Do It Again – With Helium
There’s a dire need for new, North American helium supplies to be brought online as quickly as possible.
For decades, the U.S. was the world’s largest producer of helium, accounting for as much as 40% of the worlds’ supply.
The world’s single largest source of helium for the past 70 years has been the U.S. Federal Helium Reserve (FHR) in Amarillo, Texas.
But within the past few years, the FHR stockpile has been depleted, and the helium market has opened up to the private sector for the very first time in modern history.
And with helium seeing such a tremendous surge in demand – thanks to its use in semiconductors as well as a host of other critical industries – a significant supply gap is emerging for this essential resource.
It’s a team that was (while formerly at Encana) involved in the early stages of the discovery of the Montney Formation, one of the premier natural gas formations in North America.
Without question, the Avanti Energy team is the most experienced – and most decorated – in the helium space, with direct experience in developing multi-billion dollar projects from their time at Encana.
And that’s what this team is working to do again at Avanti Energy...with drilling set to commence on an initial three wells in what could ultimately prove to be a significant helium project in Montana.
Avanti CEO Chris Bakker has over two decades of experience in oil and gas, most recently working as a commercial negotiator with Encana (now Ovintiv) for major facilities and pipelines in the Montney gas play.
His expertise includes all facets of Natural Gas Exploration like land acquisition, exploration, drilling, well production and facility integration and construction.
Vice President of Subsurface Genga Nadaraju has over two decades of experience in the oil & gas industry…Director of Geoscience Dr. Jim Wood has over 30 years of experience as a geologist specializing in reservoir characterization…VP of Engineering Ali Esmail has spent the past 13 years specializing in reservoir engineering …and Senior Geophysicist Richard Balon has over 30 years of experience in the Western Canadian Sedimentary Basin.
This is an experienced team with an impressive track record of success in the oil and gas industry.
And now they appear poised to do it again.
This very same successful team is now using the same methodology at Avanti Energy to explore for what it hopes will prove to be some of the richest helium deposits in the world.
Just recently, the company announced that it had completed its geological interpretation of this property, discovering an estimated undiscovered and unrisked resource potential of:
* Low case: 1.4 bcf of Helium
* Mid case: 4.4 bcf of Helium
* High case: 8.9 bcf of Helium
And on November 9, the company announced that it has contracted with T&S Drilling for its initial three well drilling program at its Greater Knappen land holdings in Northern Montana.
The initial drilling program is scheduled to spud in early December and will target three separate pay zones, two in the Beaverhill Lake formation and one in the Basal Sandstone formation. The drilling targets exhibit structural highs with relief of 70m to >200m. Previously drilled wells surrounding Avanti's lands have high helium shows in multiple Devonian and Cambrian targets with helium percentages of up to 2% and nitrogen percentages of up to 96%.
Analysts at Beacon Securities report that, “Our expectation of 3 exploratory wells in Q4/21 and initial helium production in Q3/22 remains unchanged...we continue to have high expectations for the Greater Knappen area. The initial drilling program in Montana and Alberta will just be the start of a multi-year exploration and development program for AVN. We maintain our $3.80 target price and our Spec Buy rating.”
This potential helium production – as early as Q3 2022 – is happening for Avanti Energy in the midst of soaring demand thanks to helium’s many impactful uses.
Why Helium is Seeing Such a “Rocket Launch” of Demand
As a noble gas helium is not combustible and has properties that make it irreplaceable for a number of important industrial applications.
Helium is the second most abundant element in the universe but it is extremely rare on earth.
With the global helium shortage we are now facing, it’s estimated that the supply will not keep up with demand for the next 20 years.
And that is happening as industry demand is projected to increase at a compound annual growth rate of 11% each year through 2037 .
While helium is most commonly thought of as being used for the inflation of balloons, the truth is helium is used in a number of critical parts of daily life.