Blue Star Helium has clinched a vital initial consent from US authorities as part of a new protracted pathway towards an eventual approval allowing it to drill a first exploration well at its Las Animas helium project in Colorado. The ASX-listed US helium player now hopes to secure an all-important drilling permit in relation to its planned maiden well at the project’s Enterprise prospect later this year.
Perth-based Blue Star says it was recently notified that its Enterprise well application or oil and gas development plan had passed a “completeness” review carried out by state government agency, the Colorado Oil and Gas Conservation Commission or “COGCC”.
The junior helium explorer hailed the nod from the COGCC as a significant milestone in the wake of uncertainty that was sparked earlier this year by regulatory changes to Colorado’s permitting process.
Blue Star’s drilling plans this year were also thrown into disarray following executive orders from the in-coming Biden Administration that – while essentially targeted at hydrocarbon drilling – spawned further complexity and delays across applications for other drilling activities.
Significantly, the company says it believes it may be the first helium player in Colorado to have passed completeness on an oil and gas development plan application since the amended rules came into effect in January this year.
Blue Star Helium Managing Director, Trent Spry said: “We now look forward to undertaking the remainder of the approval process and … receiving the final drill permit for Enterprise 16#1 during mid-to-late November, if not potentially before. We expect to achieve ‘completeness’ on future applications in a much shorter time frame because we now have a form of application that meets COGCC's expectations.”
The next step for the $41 million market-capped company in its Enterprise drilling permit journey involves a public review and a hearing, which have a deadline of September 27 this year.
Blue Star is sitting on an enviable leasehold ground position of more than 170,000 net acres around the historical Model Dome helium gas field that produced uber high-grade helium concentrations and initial flow rates from individual wells of 500,000-to-1 million cubic feet per day almost a century ago.
Model Dome was in production for a brief period only before the US Government picked it up as part of the country’s acquisition of strategic commodity reserves.
Blue Star has been cooling its heels navigating the elongated process to nail down the all-clear to kick off drilling within the fertile Enterprise block about 10km west of Model Dome.
It sees the Enterprise helium occurrences as being lodged in the same helium gas source rocks trapped between the same reservoir and seal strata characteristics as those of the historic Model Dome field.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
