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Helium Evolution Incorporated (TSXV:HEVI,OTC:HEEVF) (" HEVI " or the " Company "), a Canadian-based helium exploration company focused on developing assets in southern Saskatchewan, is pleased to announce that it has entered into an agreement with ENEOS Xplora Inc. (" ENEOS Xplora ") through its affiliated company, ENEOS Xplora USA Limited (" ENEOS USA "), pursuant to which ENEOS USA has agreed to purchase a convertible note with a face value of $8.3 million (the " Note "). This investment will bring ENEOS Xplora's total investment in the Company to $12.8 million. ENEOS Xplora and ENEOS USA are both wholly owned subsidiaries of ENEOS Group, Japan's largest energy, resources and materials conglomerate with current revenue of $91 billion USD.
Proceeds from the Note will be used to fund HEVI's 20% working interest in the helium processing facility in the Mankota area, located at 1-2-4-9W3 (the " Soda Lake Facility "), as announced on May 27, 2025 . The Soda Lake Facility is expected to be operational in the fourth quarter of 2025 and will initially tie in three helium wells through a dedicated pipeline gathering system. In addition, the Note proceeds will fund HEVI's drilling of new wells and related development activities in the Mankota area, with a winter drilling campaign anticipated to commence in the fourth quarter of 2025 and continue into the first quarter of 2026.
"We are very pleased to secure this strategic financing, which will allow us to fund our working interest in the Soda Lake Facility and advance our drilling campaign in the Mankota area," said Greg Robb, President and CEO of HEVI. "This financing not only strengthens our balance sheet but also positions HEVI to transition into a near-term producer of helium. The upcoming Soda Lake Facility is a cornerstone project that will provide stable processing capacity and create significant growth opportunities for our shareholders."
This expanded financing marks an important achievement in HEVI's strategic growth trajectory within the helium sector, further strengthening the Company's financial foundation and unlocking new opportunities for both HEVI and ENEOS Xplora. The deal underscores HEVI's increasing momentum and its position as a leader in the Canadian helium market.
The Note financing is expected to close on August 29, 2025, subject to requisite approvals, and is convertible into common shares of HEVI, subject to automatic conversion upon achievement of defined milestones (the " Milestones ") and in accordance with TSX Venture Exchange (" TSXV ") policies at a minimum price of $0.205 per share.
If the Milestones are not achieved by August 29, 2026, ENEOS USA will have the right, at any time thereafter, to convert the Note into common shares at a minimum price of $0.205. The Note will mature on August 29, 2027 (the " Maturity Date ") and will accrue interest at a rate of 8.5% per annum, payable in arrears on the Maturity Date.
Additionally, HEVI has granted ENEOS USA a gross overriding royalty (" GORR ") on HEVI's share of production from the three wells being tied into the Soda Lake Facility: 9-35-3-9W3, 10-36-3-9W3, and 10-1-4-9W3 (the " Designated Wells "). The GORR is structured as a sliding scale:
- 5% of HEVI's gross sales in the first year of production;
- 4% of HEVI's gross sales in the second year;
- 3% of HEVI's gross sales in the third year; and
- 2% of HEVI's gross sales thereafter.
HEVI will also grant ENEOS USA a 3% GORR on HEVI's share of gross sales from one of the next three wells to be drilled in the Mankota area (the " New Well "), to be selected by ENEOS USA within 90 days of receipt of drilling and testing results.
Issuance of the Note and the GORR constitute "related party transactions" under Multilateral Instrument 61-101 - Protection of Minority Securityholders in Special Transactions (" MI 61-101 "). The Company intends to rely on the financial hardship exemption from the valuation and the minority approval requirements of MI 61-101 provided for in subsections 5.5(g) and 5.7(e) of MI 61-101, respectively. The participation by ENEOS USA in the financing has been approved by directors of the Company who are independent in connection with such transactions.
About ENEOS Xplora
ENEOS Xplora is engaged in the development and production of oil and natural gas in Japan and around the world as one of the principal operating companies of the ENEOS Group , Japan's largest energy, resources and materials conglomerate.
In response to the global movement towards carbon neutrality, ENEOS Xplora is promoting a "Two Pronged" approach, through which ENEOS Xplora aims to cultivate and enhance environment-friendly business as well as focus on their conventional oil and natural gas development and production.
While the safe and stable supply of energy has always been and will continue to be ENEOS Xplora's mission, in order to create greater social value within the carbon neutral trend, guided by its corporate philosophy, "Explore the EARTH and Create Value" ENEOS Xplora will leverage its subsurface technology and innovative creativity to be a key player working towards a sustainable society.
| 1. Company name | ENEOS Xplora Inc. | ||
| 2. Address | ENEOS Building, 1-1-2 Otemachi, Chiyoda-ku, Tokyo, Japan | ||
| 3. President | Yasuhiko Oshida | ||
| 4. Capital | JPY 37.6 billion | ||
| 5. Description of business | Exploration for and development of oil, natural gas, and other mineral resources; extraction, processing, storage, sale, and shipment of petroleum, natural gas, and other mineral resources and their secondary products; carbon dioxide capture, transport, storage, and utilization | ||
About Helium Evolution Incorporated
Helium Evolution is a Canadian-based helium exploration company holding the largest helium land rights position in North America among publicly-traded companies, focused on developing assets in southern Saskatchewan. The Company has over five million acres of land under permit near proven discoveries of economic helium concentrations which will support scaling the exploration and development efforts across its land base. HEVI's management and board are executing a differentiated strategy to become a leading supplier of sustainably-produced helium for the growing global helium market.
Stay Connected to Helium Evolution
Shareholders and other parties interested in learning more about the Helium Evolution opportunity are encouraged to visit the Company's website, which includes an updated corporate presentation, and are invited to follow the Company on LinkedIn and X for ongoing corporate updates and helium industry information. Helium Evolution also provides an extensive, commissioned ‘deep-dive' research report prepared by a third party whose background includes serving as a research analyst for several bank-owned and independent investment dealers.
For further information, please contact:
| Greg Robb, President & CEO Kristi Kunec, CFO | Phone: 1-587-330-2459 Email: info@heliumevolution.ca Web: https:// www.heliumevolution.ca/ |
Statement Regarding Forward-Looking Information
This news release contains statements that constitute "forward-looking statements." Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "potential" and similar expressions, or that events or conditions "will," "would," "may," "could" or "should" occur.
Forward-looking statements in this document include statements regarding the Company's expectations regarding the closing of the transactions disclosed in the news release including the completion of the Note and the related closing date, meeting the Milestones for automatic conversion, price at conversion, the use of proceeds from the Note, the benefits of the strategic partnership to the Company, the Company becoming a leading supplier of sustainably-produced helium, requisite approvals, the Company's beliefs regarding growth of the global helium market, the Company's beliefs regarding the completion date of the Soda Lake Facility and related helium production, the Company's belief that the transactions described in this news release will create significant growth opportunities for its shareholders and other statements that are not historical facts. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors and risks include, among others: the transactions described in this news release may not close; granting of requisite approvals; the Company may not meet the Milestones for automatic conversion; the Company may reallocate the proceeds of the Note for reasons that management believes are in the Company's best interests; the Company may not realize the benefits of the strategic partnership described in this news release; the Company may choose to defer, accelerate or abandon its exploration and development plans; new laws or regulations and/or unforeseen events could adversely affect the Company's business and results of operations; stock markets have experienced volatility that often has been unrelated to the performance of companies and such volatility may adversely affect the price of the Company's securities regardless of its operating performance; risks generally associated with the exploration for and production of resources; constraint in the availability of services; commodity price and exchange rate fluctuations; adverse weather or break-up conditions; and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures.
When relying on forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and risks other uncertainties and potential events. The Company has assumed that the material factors referred to in the previous paragraphs will not cause such forward-looking statements and information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release. The Company does not intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.
This news release is not for distribution to U.S. news services or for dissemination in the United States. This news release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the " U.S. Securities Act ") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
