Helium Evolution Incorporated (TSXV:HEVI)
("
HEVI" or the "
Company"), a
Canadian-based helium exploration and production company focused on
developing assets in southern Saskatchewan, today announced the
filing of our unaudited financial results for the three and nine-
month periods ended September 30, 2022, along with a corporate
update on activities that have occurred subsequent to the end of
the period.
For complete details of the condensed interim
consolidated financial statements and the associated management’s
discussion and analysis, please refer to the Company’s filing on
SEDAR (www.sedar.com).
Three &
Nine Months
Ended September
30, 2022
Highlights
|
Three months
ended |
|
Tabular amounts in thousands ofCanadian Dollars, except share and
per share amounts |
September
30,2022 |
September 30,2021 |
Nine months ended
September30,
2022 |
Period ended September 30,20212 |
Financial |
|
|
|
|
Net loss |
3,847 |
238 |
6,843 |
1,023 |
Net loss per share, basic and diluted |
0.04 |
0.01 |
0.09 |
0.05 |
Cash |
9,482 |
332 |
9,482 |
332 |
Working capital |
9,271 |
320 |
9,271 |
320 |
Total assets |
13,644 |
341 |
13,644 |
341 |
Total liabilities |
625 |
21 |
625 |
21 |
Weighted average shares outstanding |
|
|
|
|
Basic and diluted1 |
96,033,974 |
31,102,449 |
72,453,538 |
22,596,717 |
1The weighted average number of common shares
outstanding is not increased for outstanding stock options and
warrants when the effect is anti-dilutive.2 From the period of
incorporation on January 14, 2021 to September 30, 2021
During the third quarter of 2022, HEVI continued
to execute on its focused strategy of developing its 5.5 million
acres of helium rights in southern Saskatchewan, to ultimately
produce and sell helium, generate cash flow and drive positive
returns for shareholders. HEVI drilled two 100% operated wells in
June and July at McCord, resulting in capital expenditures of $3.8
million for the third quarter, primarily allocated to drilling
followed by requisite downhole abandonment activities since initial
results did not return sufficient quantities of helium to warrant
production testing. With strong helium indications in the area, as
well as the expanded and enhanced farm-out agreement (the
“Amended Farmout Agreement”) with
North American Helium (“NAH”) announced October
21, 2022, HEVI maintains a very positive near and longer-term
outlook for its asset base. The Company retained ongoing financial
flexibility with positive working capital of $9.3 million at the
end of the quarter plus $1.5 million of tubing and casing in
inventory, of which $0.5 million was sold subsequent to quarter
end.
The Company was also pleased to bolster the
strength of its internal management team during the quarter with
the appointment of Ms. Kristi Kunec as Chief Financial Officer,
effective September 12th, 2022. Ms. Kunec brings over 15 years of
financial experience with strong acumen in corporate finance,
organizational planning and financial reporting for high-growth
resource companies.
Outlook
On October 21, 2022, through the Amended Farmout
Agreement, HEVI and NAH expanded and accelerated their previous
farmout agreement, providing the Company with numerous significant
benefits, which include:
- An acceleration
of drilling as NAH will drill the first two test wells on HEVI
lands in Q4/22 and a third test well in the first half 2023;
- Preservation of
capital as costs to drill the test wells will be funded 100% by NAH
while HEVI retains a 20% working interest;
- Based on success
with the first three test wells, NAH commits to expeditiously drill
development wells on the earned farmout blocks, subject to surface
access and regulatory approvals;
- NAH will select a
fourth and fifth test well location by June 30, 2023, with both
wells to be spud by the first quarter of 2024;
- New seismic
option and seismic review option agreements will give NAH the
option to increase the number of exploration wells to be drilled by
approximately 60%, from five to up to eight;
- At no cost, HEVI
has received NAH’s proprietary seismic recently used to drill three
successful NAH wells; and
- HEVI retains a
20% working interest in any successful wells with no up-front
capital costs and the ability to participate in future development
wells at the same 20% interest level.
On November 9th, HEVI confirmed that NAH had
spud its first test well (the “First Test Well”)
on farmout lands within Block 1 at its Mankota, Saskatchewan area.
On November 21st, HEVI announced that NAH had informed the Company
that the open hole portion of the First Test Well would be
abandoned, but that NAH was electing to suspend the cased hole
portion of the well to afford optionality and the ability to
re-enter it at a later date, potentially to drill a sidetrack to
another target. NAH is expected to spud its second test well (the
“Second Test Well”) in mid-December. In tandem
with ongoing developments under the NAH Amended Farmout Agreement,
HEVI is also continuing to advance the selection of its own 100%
operated future drilling targets, and are undertaking numerous
initiatives designed to support ongoing technical work, including
geological and geophysical modelling, shooting of proprietary 2D
seismic, seismic reprocessing and interpretation and well log
integration. The Company also recently acquired approximately 360km
of 2D seismic data, with plans to purchase additional 2D seismic
over the next six to nine months.
Relative to other helium peers, HEVI remains
very well positioned and pleased with how far it has advanced on
the journey to realize production and cash flow. The Company looks
forward to benefitting from the continued exploration and
development of its asset base by NAH, which affords HEVI extensive
data and expertise while preserving capital and enabling the
Company to pursue drilling and development of its 100% owned
targets in the future.
Stay Connected
to Helium
EvolutionShareholders and other parties interested
in learning more about the Helium Evolution opportunity are
encouraged to visit the Company’s website, which includes an
updated corporate presentation, and are invited to follow the
Company on LinkedIn and Twitter for ongoing corporate updates and
helium industry information. Helium Evolution also provides an
extensive, commissioned ‘deep-dive’ research report prepared by a
third party whose background includes serving as a research analyst
for several bank-owned and independent investment dealers. In
addition to recent media articles, HEVI maintains a profile on the
Investing News Network platform, where further information,
editorial pieces and industry reviews are available.
About Helium
Evolution Incorporated
Helium Evolution is a Canadian-based helium
exploration and production company holding the largest helium land
rights position in North America among publicly-traded companies,
focused on developing assets in southern Saskatchewan. The Company
has over five million acres of land under permit near proven
discoveries of economic helium concentrations which will support
scaling the exploration and development efforts across its land
base. HEVI’s management and board are executing a differentiated
strategy to become a leading supplier of sustainably-produced
helium for the growing global helium market, offering a compelling
opportunity for investors.
For further
information, please
contact:
Greg Robb, President & CEOKristi Kunec, CFO |
Phone: 1-587-330-2459Email: info@heliumevolution.caWeb:
https://www.heliumevolution.ca/ |
|
|
Cindy Gray, Investor
Relations |
info@5qir.com | 1-403-705-5076 |
Statement
Regarding Forward-Looking
Information
This news release contains statements that
constitute "forward-looking statements." Such forward looking
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results, performance or achievements,
or developments in the industry to differ materially from the
anticipated results, performance or achievements expressed or
implied by such forward-looking statements. Forward looking
statements are statements that are not historical facts and are
generally, but not always, identified by the words "expects,"
"plans," "anticipates," "believes," "intends," "estimates,"
"projects," "potential" and similar expressions, or that events or
conditions "will," "would," "may," "could" or "should" occur.
Forward-looking statements in this document
include statements regarding the Company's expectations regarding
the Company’s expectations regarding the Company’s and NAH’s
exploration and drilling plans, the Company’s ability to identify
future exploration and drilling targets, including the purchase of
2D seismic and activities related to the Amended Farmout Agreement,
increasing shareholder value, the Company’s ability to preserve
capital, , drilling timeline of the Second Test Well and any future
NAH drills, the purchase of additional seismic and other statements
that are not historical facts. By their nature, forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause our actual results, performance or
achievements, or other future events, to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors and risks
include, among others: NAH may be unsuccessful in drilling
commercially productive wells, NAH may defer the drilling of the
Second Test Well and subsequent wells; the Company may choose to
defer, accelerate or abandon its drilling plans; new laws or
regulations and/or unforeseen events could adversely affect the
Company’s business and results of operations; stock markets have
experienced volatility that often has been unrelated to the
performance of companies and such volatility may adversely affect
the price of the Company's securities regardless of its operating
performance; risks generally associated with the exploration for
and production of resources; the uncertainty of estimates and
projections relating to expenses; constraint in the availability of
services; commodity price and exchange rate fluctuations; the
current COVID-19 pandemic; adverse weather or break-up conditions;
and uncertainties resulting from potential delays or changes in
plans with respect to exploration or development projects or
capital expenditures.
When relying on forward-looking statements and
information to make decisions, investors and others should
carefully consider the foregoing factors and risks other
uncertainties and potential events. The Company has assumed that
the material factors referred to in the previous paragraphs will
not cause such forward-looking statements and information to differ
materially from actual results or events. However, the list of
these factors is not exhaustive and is subject to change and there
can be no assurance that such assumptions will reflect the actual
outcome of such items or factors. The reader is cautioned not to
place undue reliance on any forward-looking information. Such
information, although considered reasonable by management at the
time of preparation, may prove to be incorrect and actual results
may differ materially from those anticipated. Forward-looking
statements contained in this press release are expressly qualified
by this cautionary statement. The forward-looking statements
contained in this press release are made as of the date of this
press release. The Company does not intend, and expressly disclaims
any intention or obligation to, update or revise any
forward-looking statements whether as a result of new information,
future events or otherwise, except as required by law.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
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