Pulsar Helium Inc. (TSX-V: PLSR): Additional acreage could increase the size of the prize
• Pulsar has signed a lease with a private mineral rights holder to expand the area surrounding the company’s Topaz helium project. The additional mineral rights are within a 6.2 mile radius of the Topaz discovery and cover a total of 2,840 gross acres (1,049 net acres). This more than doubles net acres under lease (existing net area of 1,040 net).• Pulsar also has an option to acquire a further 2,092 net acres.
• The new lease is for an initial term of 20 years (extendable up to a maximum of 40 years). The lease gives Pulsar exclusive rights to non hydrocarbon gases. The private mineral rights owner will receive U$11,000 in cash from Pulsar and retains a production royalty of 3%. The acreage addition could increase the amount of prospective resources (current 2U: ~3 mmcf, 3U: ~76 mmcf currently). A new resource report is expected to be prepared after the drilling campaign.
• We estimate the unrisked NAV of 100 mmcf of helium at ~C$0.65 per share.
• Pulsar also announced that the licence area for the Tunu project in Greenland has been extended by 45 km2 to 2,816 km2. This enlarged area now covers the Kap Tobin locality where thermal springs were sampled in 2021, returning a helium concentration of 0.8%, alongside 97% nitrogen and 2% argon. This area is also expected to be able to co-generate power and heat.
• We re-iterate our target price of C$0.90 per share.
Cashflow
Assuming US$15 mm development capex (helium sold in gaseous form) and first gas in 2H24, net cash is forecast to be >2x the current market cap by YE25.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
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