Helium One Global (LON: HE1) is raising at least £7m at 5p a share and the cash will be spent on a single exploration well in the Tai prospect in the Rukwa Basin, Tanzania. The AIM-quoted share price closed at 6.35p before the placing was announced.
Management has secured a drilling rig for the first quarter of 2023. Helium One Global has selected Exalo as preferred drilling contractor because of legal problems concerning the previous contractor. The rig will be moved from South Africa to Tanzania.
The drilling rig will cost £2.07m and formulation evaluation will cost £2.05m. The rest will go on other costs and working capital.
When Helium One Global joined AIM at the end of 2020 it raised £6m at 2.84p a share. In April 2021, a further £10m was raised at 10p a share. The share price peaked at around 28p later that year. There have been small cash injections from the exercise of warrants. By the end of June 2022, there was $4.91m in the bank.
Helium is a colourless, odourless and inert gas and it is used in the medical, aerospace and computing sectors. MRI scanners and welding are the largest users of helium. Global production is lower than consumption.