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Helium Evolution Incorporated (TSXV:HEVI) (" HEVI " or the " Company "), a Canadian-based helium exploration and production company focused on developing assets in southern Saskatchewan, today announced the filing of our unaudited financial results for the three and nine- month periods ended September 30, 2022, along with a corporate update on activities that have occurred subsequent to the end of the period.
For complete details of the condensed interim consolidated financial statements and the associated management's discussion and analysis, please refer to the Company's filing on SEDAR ( www.sedar.com ).
Three  &  Nine  Months  Ended  September  30,  2022  Highlights
| Three  months  ended | ||||
Tabular  amounts  in  thousands  of Canadian  Dollars,  except  share  and per share amounts | September  30, 2022 | September 30, 2021 | Nine  months ended  September 30,  2022 | Period ended September 30, 2021 2 |
| Financial | ||||
| Net loss | 3,847 | 238 | 6,843 | 1,023 |
| Net loss per share, basic and diluted | 0.04 | 0.01 | 0.09 | 0.05 |
| Cash | 9,482 | 332 | 9,482 | 332 |
| Working capital | 9,271 | 320 | 9,271 | 320 |
| Total assets | 13,644 | 341 | 13,644 | 341 |
| Total liabilities | 625 | 21 | 625 | 21 |
| Weighted average shares outstanding | ||||
| Basic and diluted 1 | 96,033,974 | 31,102,449 | 72,453,538 | 22,596,717 |
1 The weighted average number of common shares outstanding is not increased for outstanding stock options and warrants when the effect is anti-dilutive.
2 From the period of incorporation on January 14, 2021 to September 30, 2021
During the third quarter of 2022, HEVI continued to execute on its focused strategy of developing its 5.5 million acres of helium rights in southern Saskatchewan, to ultimately produce and sell helium, generate cash flow and drive positive returns for shareholders. HEVI drilled two 100% operated wells in June and July at McCord, resulting in capital expenditures of $3.8 million for the third quarter, primarily allocated to drilling followed by requisite downhole abandonment activities since initial results did not return sufficient quantities of helium to warrant production testing. With strong helium indications in the area, as well as the expanded and enhanced farm-out agreement (the " Amended Farmout  Agreement ") with North American Helium (" NAH ") announced October 21, 2022 , HEVI maintains a very positive near and longer-term outlook for its asset base. The Company retained ongoing financial flexibility with positive working capital of $9.3 million at the end of the quarter plus $1.5 million of tubing and casing in inventory, of which $0.5 million was sold subsequent to quarter end.
The Company was also pleased to bolster the strength of its internal management team during the quarter with the appointment of Ms. Kristi Kunec as Chief Financial Officer, effective September 12 th , 2022. Ms. Kunec brings over 15 years of financial experience with strong acumen in corporate finance, organizational planning and financial reporting for high-growth resource companies.
Outlook
On October 21, 2022, through the Amended Farmout Agreement, HEVI and NAH expanded and accelerated their previous farmout agreement, providing the Company with numerous significant benefits, which include:
- An acceleration of drilling as NAH will drill the first two test wells on HEVI lands in Q4/22 and a third test well in the first half 2023;
- Preservation of capital as costs to drill the test wells will be funded 100% by NAH while HEVI retains a 20% working interest;
- Based on success with the first three test wells, NAH commits to expeditiously drill development wells on the earned farmout blocks, subject to surface access and regulatory approvals;
- NAH will select a fourth and fifth test well location by June 30, 2023, with both wells to be spud by the first quarter of 2024;
- New seismic option and seismic review option agreements will give NAH the option to increase the number of exploration wells to be drilled by approximately 60%, from five to up to eight;
- At no cost, HEVI has received NAH's proprietary seismic recently used to drill three successful NAH wells; and
- HEVI retains a 20% working interest in any successful wells with no up-front capital costs and the ability to participate in future development wells at the same 20% interest level.
On November 9 th , HEVI confirmed that NAH had spud its first test well (the " First Test Well ") on farmout lands within Block 1 at its Mankota, Saskatchewan area. On November 21 st , HEVI announced that NAH had informed the Company that the open hole portion of the First Test Well would be abandoned, but that NAH was electing to suspend the cased hole portion of the well to afford optionality and the ability to re-enter it at a later date, potentially to drill a sidetrack to another target. NAH is expected to spud its second test well (the " Second Test Well ") in mid-December. In tandem with ongoing developments under the NAH Amended Farmout Agreement, HEVI is also continuing to advance the selection of its own 100% operated future drilling targets, and are undertaking numerous initiatives designed to support ongoing technical work, including geological and geophysical modelling, shooting of proprietary 2D seismic, seismic reprocessing and interpretation and well log integration. The Company also recently acquired approximately 360km of 2D seismic data, with plans to purchase additional 2D seismic over the next six to nine months.
Relative to other helium peers, HEVI remains very well positioned and pleased with how far it has advanced on the journey to realize production and cash flow. The Company looks forward to benefitting from the continued exploration and development of its asset base by NAH, which affords HEVI extensive data and expertise while preserving capital and enabling the Company to pursue drilling and development of its 100% owned targets in the future.
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 Twitter 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. In addition to recent media articles , HEVI maintains a profile on the Investing News Network platform, where further information, editorial pieces and industry reviews are available.
About  Helium  Evolution  Incorporated
Helium Evolution is a Canadian-based helium exploration and production 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, offering a compelling opportunity for investors.
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/ |
| Cindy Gray, Investor Relations | info@5qir.com | 1-403-705-5076 |
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 Company's  expectations regarding the Company's and NAH's  exploration  and drilling plans, the Company's  ability to identify future exploration and drilling targets, including the purchase of 2D seismic and activities related to the Amended Farmout Agreement,  increasing shareholder value,  the Company's  ability  to  preserve capital,  ,  drilling  timeline  of  the  Second  Test  Well and any future NAH drills,  the  purchase  of  additional  seismic  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:  NAH  may  be unsuccessful  in  drilling  commercially  productive wells, NAH  may  defer  the  drilling  of  the  Second  Test  Well and subsequent wells; the  Company  may  choose  to  defer,  accelerate  or  abandon  its  drilling  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; the uncertainty of estimates and projections relating to expenses; constraint in the availability of services; commodity price and exchange rate fluctuations; the current COVID-19 pandemic; 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  press  release  are  expressly  qualified  by  this  cautionary  statement.  The  forward-looking  statements contained  in  this  press  release  are  made  as  of  the  date  of  this  press  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.
Neither  the  TSX Venture  Exchange  nor  its  Regulation  Services  Provider  (as  that  term is  defined  in  the  policies  of  the  TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
