SASKATOON, SK, July 5, 2022
/CNW/ - Royal Helium Ltd. (TSXV: RHC) (TSXV: RHC.WT) (OTCQB: RHCCF)
("Royal") is pleased to announce that the Company has
received the comprehensive simulation study for multistage
hydraulically fractured horizontal wells completed by Dr.
Gary Zhao, P.Eng., Petroleum Systems
Engineering, University of Regina. Over
600 simulations were run with multiple variables, using the data
from Royal's DST and DFIT operations in the Climax-4 well. Royal is
currently evaluating several of the viable production well models
presented and will select the ultimate design(s) that will have the
largest deliverability with the quickest payback period. Given the
large areal extent of 30+ sections (30+ square miles) of Nazare,
multiple wells will be considered. Royal anticipates well design
finalization and drilling of the first Nazare well in late
2022.
Study highlights include, on a per well basis:
|
|
Single-leg HZ
Well
|
Dual-leg HZ
Well
|
Low
case
|
|
|
|
|
Initial 6-month average
flow rate
|
3,078
MCF/day
|
6,155
MCF/day
|
|
Helium production
rate
EUR Raw gas
|
20 MCF/day
4.63 BCF
|
40 MCF/day
9.27 BCF
|
|
EUR Helium
|
30,095 MCF
|
60,255 MCF
|
High
case
|
|
|
|
|
6-month average flow
rate
|
8,623
MCF/day
|
17,245
MCF/day
|
|
Helium production
rate
EUR Raw gas
|
56 MCF/day
11.31 BCF
|
112 MCF/day
22.61 BCF
|
|
EUR Helium
|
73,515 MCF
|
146,965 MCF
|
*Notes to
table:
|
|
1/ All 4
scenarios forecast time to abandonment > 30 years (where
recovery > 10 MCF/day)
|
|
2/ "EUR" =
Forecast Expected Ultimate Recovery
|
|
3/ Helium
production rate calculated as .65% of 6-month average raw gas
production
|
|
4/ Helium
EUR calculated as .65% of raw gas EUR
|
|
|
|
John Styles, Lead Engineer for
Royal comments, "The development of a large scale unconventional
primary helium reservoir is a first for Saskatchewan, and perhaps the world. Although
the simulation study evaluated well configurations with as many as
12 lateral legs, we will likely focus on the 1 - 3 leg scenarios
with 1-mile-long laterals. These scenarios are single section (1
square mile) development plans whereas the areal extent so far
identified by seismic exceeds 30 sections. With these results and
after the first horizontal into Nazare, we will plan to
strategically exploit Nazare to its fullest extent".
Andrew Davidson, President and
CEO, Royal Helium comments, "We are
extremely pleased with the outcome of Dr. Zhao's study, the
validation that our Nazare discovery is capable of large-scale
deliverability is a huge addition to our "conventional" production
profile beginning with our first 2 processing plants at Climax and
Steveville. We now look forward to planning the first Nazare well
for later this year and, predicated on its outcome, the design work
for an additional, larger permanent facility for the Climax Nazare
reservoir. The question of whether the Nazare will be a
producible reservoir has now been answered and we will move
aggressively towards the first production well and further, will
make plans toward exploiting the whole reservoir".
Study Notes
The entire simulation study encompassed 612 simulations designed
to evaluate the combination of factors that could yield a
simulation result with a forecast initial production rate above 1
mmscf/d for as long a period as possible. The factors evaluated
included: 1 through 12 legs, each with 700m or 1400m leg
lengths (1/2 mile and 1 mile with customary 100m buffer); permeabilities ranging from 5
through 40 nD; multi-stage frac completions ranging from 10 through
32 stages, each with fracture half lengths ranging from 15 through
350 meters; an assumed evaluation term of 30 years to reach an
economic limit.
Dr. Zhao's full report will be published under the title" Drill
Stem Test Data Interpretation and Long Term Productivity Study for
Royal Helium Reservoirs of Climax/Deep Nazare Zones" Dr. G. Zhao,
Petroleum Systems Engineering, Faculty of Engineering and Applied
Science University of Regina,
June 30th 2022.
There are no current National Instruments such as NI 51-101 or
NI 43-101 that cover helium deposits or production.
About Royal Helium Ltd.
Royal controls over 1,000,000 acres of prospective helium land
in southwestern and south-east Saskatchewan. All of Royals' lands are in
close vicinity to highways, roads, cities and importantly, close to
existing oil and gas infrastructure, with a significant portion of
its land in close proximity to existing helium producing locations.
With stable, rising prices and limited, non-renewable sources for
helium worldwide, Royal intends to become a leading North American
producer of this high value commodity.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
INFORMATION
Neither 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.
This release includes certain statements that may be deemed
to be "forward-looking statements". All statements in this
release, other than statements of historical facts, that address
events or developments that management of the Company expects, are
forward-looking statements. Although management believes the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance, and actual results or developments may differ
materially from those in the forward-looking statements. The
Company undertakes no obligation to update these forward-looking
statements if management's beliefs, estimates or opinions, or other
factors, should change. Factors that could cause actual
results to differ materially from those in forward-looking
statements, include market prices, exploration and development
successes, continued availability of capital and financing, and
general economic, market or business conditions. Please see
the public filings of the Company at www.sedar.com for further
information.
SOURCE Royal Helium Ltd.