Pulsar Helium Inc. (TSX-V: PLSR): High concentration of very high value helium-3 at Topaz
• Laboratory analysis of gas samples from the Jetstream #1 well at Topaz shows sustained helium-3 concentrations ranging from 1.3 to 14.5 ppb, amongst the highest naturally occurring helium-3 levels publicly reported in a terrestrial reservoir.• This is in addition to the measured 7-8% concentration of helium-4.
• Helium-3 was encountered across all tested intervals of Jetstream #1 suggesting a single homogeneous source of helium charging the reservoir, rather than sporadic pockets or contamination.
• Helium-3 is rare and valuable, commanding ~US$2,500 per litre in specialized markets (and US$18.7 mm per kg).
• At present, there is no commercial technology in operation that separates helium-3 from helium-4 in a gas stream at scale. Pulsar is in discussions with third parties to evaluate methods for helium-3 separation. The aim is to produce pure helium-3. Pending further visibility, we re-iterate our target price of £0.80 per share.
Helium-3: where is it found? What is it used for?
In Earth's atmosphere, helium-3 exists at only about 7 parts per trillion, and historically it has been obtainable mainly as a by-product from nuclear facilities (via tritium decay) or in minute quantities from certain natural gas fields. The isotope's ability to absorb neutrons makes it indispensable for neutron detectors used in nuclear security and scientific instrumentation. Its low boiling point and unique quantum properties enable ultra-low-temperature cooling systems (utilized in quantum computing and fundamental physics experiments). Moreover, helium-3 is a promising fuel for nuclear fusion reactions, when combined with deuterium, helium-3 could produce energy with virtually no radioactive waste, a long-term goal of fusion energy programs.
Valuation
Our unrisked NAV for Pulsar is £2.08 per share with a ReNAV of £0.78 per share. This assumes that Pulsar has access to the proportion of the resources on State lands which it is in the process of securing. The presence of helium-3 is not included in our valuation yet and offers further material potential upside.
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.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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