First Helium

Overview

The international supply of helium is expected to run into ongoing supply/demand imbalances in the near future. Why does this matter? The simple answer: helium is needed to supply various industries, including healthcare, semiconductors and aerospace. Given that helium is rare, non-renewable and non-substitutable in many cases, new and significant helium production is strongly needed.

As production of helium in the US becomes diminished attention has turned to adjacently-situated Canada, which has the fifth-largest helium resource in the world. Specifically, the province of Alberta is one of the best jurisdictions for exploration and development because it hosts helium-rich reserves. As a result, companies with projects in Alberta present an exciting opportunity for investors seeking to capitalize on the projected increase in helium demand and strong associated helium prices.

First Helium Inc. (“First Helium” or the “Company”) (TSXV:HELI) is a Canadian exploration and development company specializing in identifying and extracting helium in the province of Alberta. The Company strives to become a leading North American helium producer by leveraging a low-risk development project supported by its existing discovery well and adjacent undeveloped lands. First Helium is working to bring its discovery well into production to establish a strong base of cash flows. The Company’s management team, along with its board of directors and strategic advisory board, are highly experienced with previous success in oil and gas exploration and production, capital markets and finance, helium project development, construction and project management and mining exploration and development.

First Helium’s flagship Worsley project is located north of Grande Prairie, Alberta in the Western Canadian Sedimentary Basin (the “WCSB”). Helium content on the property was tested as high as 1.3 percent based over three long-term test periods. The net present value (“NPV”) of the contingent resource is estimated to be as high as $15.2 million (at a 10 percent discount rate) or $0.23 per basic share outstanding based on an independent engineering report conducted by Sproule Associates Limited (“Sproule”).

In March of 2021, First Helium raised approximately $12 million. The majority of the funds will be used to develop the Company’s Worsley project. The initial discovery well that is located on those lands is expected to be ready to produce helium by the end of 2022, following the installation of a scalable and modular processing facility. The development plan also includes a three-well program that is expected to increase the Company’s inventory of helium volumes at its core production area.

Based on the success of its discovery well, First Helium has now acquired 125 sections of land spanning 32,000 hectares on trend with the discovery well. Most of the additional land was acquired in 2018 at Crown land sales at attractive prices. The Company considers the acquired lands to be highly prospective for helium and on trend with the discovery well at the Worsley Property.

In addition to its core Worsley area, First Helium has an excellent opportunity to establish a significant second core area for exploration and development of helium in another proven productive region of the WCSB. Specifically, First Helium has entered into an agreement with a third-party Canadian company to explore for helium on over 350,000 contiguous hectares of highly prospective land in southern Alberta. Helium content is greater than 0.5 percent in a number of formations over the prospective land base. A key highlight of the agreement is that it provides First Helium access to approximately 360 sections of 3D seismic data and 530 km of 2D seismic data – necessary and typically costly information required for successful helium exploration.

First Helium also exhibits a strong and focused financing strategy. Through its long-term helium production plan, the Company aims to maintain a responsible capital structure and avoid any unnecessarily dilutive financings to develop its lands and facilities. Recently, First Helium fulfilled its goal of achieving near-term liquidity through its listing on the TSX-V on July 12, 2021 following the filing of its Final Prospectus.

First Helium also has a highly attractive valuation relative to its publicly-listed peer group, given its current assets and adjacent land assets. As of July 7, 2021, the Company’s market capitalization was under $20 million and its share structure consists of 65.6 million basic shares outstanding, 6.1 million options and 27.6 million warrants, for a fully-diluted share total of 99.3 million. First Helium’s approximate cash position was also approximately $8.5 million on the same date.

The Company is uniquely positioned for success based on the current timeline for its Worsley project. First Helium will be one of the fastest companies to enter production compared to other existing public companies in the helium industry. It believes that its resources will be low-risk given the existing discovery well and will provide significant helium yields based on current data indications. The Company also plans to set up off-take marketing arrangements with third-party distributors for its helium.

Company Highlights

• First Helium is a Canadian exploration and development company specializing in identifying and extracting helium in the province of Alberta. It is working to become a leading North American helium producer by leveraging a low-risk development project supported by its existing discovery well and adjacent undeveloped lands
• The Company’s flagship Worsley Helium project is located north of Grande Prairie, Alberta in the WCSB. Helium content in its discovery well has been tested as high as 1.3 percent based over three individual long-term test periods.
• The Company is working to bring its discovery well into production to establish a strong cash flow base and expand helium production by drilling an additional three wells on adjacent lands as defined by 3D seismic data.
• The NPV of the contingent resource on the Worsley project is estimated to be as high as $15.2 million (at a 10 percent discount rate) or $0.23 per basic share outstanding, based on a Sproule independent engineering report.
• First Helium has secured 125 sections, or 32,000 hectares of highly prospective helium exploration and development land on trend with the discovery well.
• To augment its Worsley Property, First Helium has entered into an agreement with a third-party Canadian company to explore for helium on over 350,000 contiguous hectares of highly prospective land in southern Alberta. This will provide the Company with an excellent opportunity to establish a significant second core area for exploration and development of helium in another region of the WCSB that has been proven to be productive.
• First Helium is listed on the TSX-V under the “HELI” stock symbol.
• The Company’s management team is highly experienced with previous success in oil and gas exploration and production, capital markets and finance, helium project development, construction and project management and mining exploration and development.
• First Helium acquired an aggregate of six kilometers of strategic natural gas gathering pipeline assets at Worsley.