Pulsar Helium Inc. press release

Pulsar Helium Announces Independent Resource Estimate For One Prospect At The Topaz Project, Immediate Investment Of £1.125 Million And Intention To Dual-List On The London Stock Exchange's Aim Market

2024-08-21

TSXV - TSX Venture Exchange · Portugal · Resource Estimate

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This announcement is an advertisement and not an admission document or a prospectus and does not constitute or form part of an offer to sell or issue or a solicitation of an offer to subscribe for or buy any securities nor should it be relied upon in connection with any contract or commitment whatsoever in any jurisdiction. Potential investors should not purchase or subscribe for any transferable securities referred to in this announcement except on the basis of the information in the final form of an admission document (the "Admission Document") which may be published in due course in connection with the proposed admission of its issued and to be issued common shares ("CommonShares") to trading on AIM, a market operated by London Stock Exchange plc ("AIM"). Upon such publication the Admission Document will supersede this announcement and the information contained herein in its entirety and your investment decision, if any, must be made only on the basis of the information contained therein. It should be noted that an investment in any transferable securities referred to in this announcement carries a number of risks and that the value of investments may go down as well as up. Investors should take independent advice from a person experienced in advising on investment in securities such as those referred to in this announcement if they are in doubt.

CASCAIS, PORTUGAL / ACCESSWIRE / August 21, 2024 / Pulsar Helium Inc. (TSXV:PLSR)(OTCQB:PSRHF) ("Pulsar" or the "Company") is pleased to announce receipt of an independent technical report of the Contingent and Prospective Resources for helium and CO2from Sproule International Limited ("Sproule") from one prospect at the Company's flagship Topaz Project in Minnesota (the "2024 Sproule Report"). The evaluation relates to the Company's first half 2024 drilling of the Jetstream #1 appraisal well* and geophysical surveys conducted across the prospect. The contingent and prospective resource acreage covered in the 2024 Sproule Report represents approximately 13% of the Company's gross land position that it has under lease and exclusive option.

Pulsar is also pleased to announce its intention to apply for the admission to trading of the Company's Common Shares on AIM, with a target admission date before the end of October 2024 (the "AIM IPO"). The AIM IPO is supplementary to the Company's existing listing on the TSX Venture Exchange (the "TSX-V") in Canada.

Based on feedback from a recent corporate roadshow arranged for the Company by OAK Securities, the Company believes the AIM IPO will enhance its access to UK and European based investors, from whom it is proposing to raise approximately £5 million in connection with the AIM IPO. A principal of OAK Securities has agreed to cornerstone the IPO capital raising by advancing to the Company £1.125 million to fund the long lead items for the deepening of the Jetstream #1 well, expected to commence in October 2024, and the AIM IPO costs (the "Cornerstone Investment"). The mechanics of the Cornerstone Investment are detailed below.

_* In the State of Minnesota, the regulatory term is ‘exploratory boring'._

Resource Highlights from one prospect at the Topaz Project:

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Helium Resources Evaluation (unrisked, gross recoverable)

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44% increase to Sproule's previous helium Contingent Best Estimate (2C) Gross Recoverable Resource, now 22.9 million standard cubic feet ("MMcf"), Pmean of 79.0 MMcf, and P10 of 174.0 MMcf

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12,165% increase to the helium Prospective Best Estimate (2U) Gross Recoverable Resource, now 380.2 MMcf, Pmean of 1.3 billion cubic feet ("Bcf"), and P10 of 2.8 Bcf

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CO2Resources Evaluation (unrisked, gross recoverable)

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Maiden CO2Contingent Best Estimate (2C) Gross Recoverable Resource, 171.8 MMcf, Pmean of 597.7 MMcf, and P10 of 1.3 Bcf

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Maiden CO2Prospective Best Estimate (2U) Gross Recoverable Resource, 2.9 Bcf, Pmean of 10.1 Bcf, and P10 of 21.3 Bcf

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Due to an ongoing shortage of CO2in the USA, with bulk CO2purchases increasing up to USD$32 per thousand cubic feet ("Mcf"), it has the potential to be a bonus and valuable by-product of Pulsar's helium production*

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Chance of commerciality

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The 2024 Sproule Report states: "Chance of Commerciality (Pc) is the likelihood that the Topaz Project will, in a timely manner, be able to be commercialized. The Topaz project has both commercial concentration helium and CO2and there are no significant environmental nor logistical barriers to commercialization given its location. Therefore, given the Resource base, the Pc is fairly high for an early stage project with a value of 0.65."

The contingent resources estimated in the 2024 Sproule Report relates to one prospect within the Topaz Project, comprising acreage under the Company's leases surrounding the Jetstream #1 well, and the acreage of the prospective resources is under the Company's leases and exclusive options. The contingent and prospective resource acreage covered in the 2024 Sproule Report represents approximately 13% of the Company's gross land position that it has under lease and exclusive option.

Thomas Abraham-James, President & CEO of Pulsar, commented:"_The resource evaluation is significant as it is based only on one prospect within the Topaz Project and data from only one well, Jetstream #1, which naturally flowed high-concentration helium of up to 14.5% to surface and without the presence of water. Such positive estimations received from a single and comparatively shallow well are hugely encouraging ahead of further exploration, which Pulsar has scheduled for Q4 2024. Data indicates that the well penetrated only the top of the helium-bearing fracture zone which is likely to persist for a further 1,650ft (500m) vertical depth. Therefore deepening of the Jetstream #1 well, scheduled for Q4 2024, is likely to have a significant impact on the next iteration of the resource estimation. We have made great progress in our first year as a listed entity and intend to build on this success and realise Topaz's full potential."_

Thomas further commented_:"The process to dual-list the Company's securities on London's AIM market is underway, with AIM being an attractive exchange for growth industrial gas companies. We have very strong interest from UK and European investors, underpinned by an immediate £1.125m cornerstone investment in the IPO from a principal of our UK broker, OAK Securities."_

_*This is for context and does not form part of the resource report._

Outlook

The Jetstream #1 well confirmed the presence of helium and CO2bearing gas identified in the original LOD-6 discovery well and has substantially de-risked the Topaz Project. In addition, Jetstream #1 correlates with seismic data acquired by the Company which shows a distinct velocity anomaly at the depth of the gas zone that persists for a further ~500m and it is the Company's near-term intention to deepen Jetstream #1 to test the full scale of the seismic velocity anomaly. This is also proposed to be accompanied by a step out well and additional seismic acquisition with the intention of increasing the size of the resource base and delineating additional prospects. The Company intends to commission a third-party preliminary economic assessment (PEA) study, with the intention of identifying near-term production scenarios.

Company Analysis of Material Changes from the 2022 Sproule Report

Sproule last reported on Pulsar's Topaz Project with its "Evaluation of the Helium Resources of RGGS Land & Minerals, Ltd., L.P. in Minnesota, USA for Pulsar in April of 2022" (the "2022 Sproule Report"). There have been several material changes to the Topaz Project since that report, the most notable being Pulsar's drilling of the Jetstream #1 well. This well confirmed the presence of a fractured reservoir that contained native gas with high concentrations of both helium and carbon dioxide. In the 2022 Sproule Report, Sproule used a Low Case Reservoir Model of a single fracture which has now been disproven as the Jetstream #1 well has multiple fractures with gas shows. Additionally, the 2022 Sproule Report used a High Case Reservoir Model of a vugular dual porosity system which has likewise been disproven. Using conventional oil and gas testing equipment, the Jetstream #1 well tested reservoir pressures and flow rates and obtained multiple reliable gas analysis.

Pulsar also acquired multiple geophysical surveys across the Topaz Project which have been integrated into the analysis of both the Jetstream #1 well and the historical mineral wellbores. These various geophysical surveys have been interpreted to show an extended gas filled fracture network deeper than the penetration of the Jetstream #1 well and more laterally extensive. These 3D volumes have been accounted for as Prospective Resources as they have yet to be tested by any wells.

The Company's land holdings that are evaluated in the 2024 Sproule Report consist of a helium discovery located approximately 100 km northeast of Duluth, in Lake County, Minnesota, USA.

Gas samples were taken from the flowing well test and analyzed by Isotech Laboratories. 21 samples over 12 days were compositionally analyzed and had a range of helium of 14.48-7.91% by volume with an average of 9.91%. The carbon dioxide percentages ranged from 21.5% to 71.28% by volume with an average of 62.49%.

The Company notes that Jetstream #1 was drilled within 50ft (15m) of the LOD-6 discovery well (drilled in 2011), a mineral exploration borehole that encountered an uncontrolled gas from a depth of 1,778ft (542m), with concentration of 10.5% helium, measured in 2011. The gas flowed naturally to surface and showed no sign of pressure decline during the flow period of four days.

Jetstream #1 was designed to twin this discovery and encountered gas which naturally flowed to surface at a similar depth of between 1,740 - 1,975ft and had a maximum measured absolute open flow rate of 821 Mcf/d from fractured igneous reservoirs, with 8.7-14.5% helium and 62-74% CO2 measured, with no formation water present. Total depth drilled was 2,200ft, and Jetstream #1 is in a suspended state capable of being either re-entered or used for production.

In May 2024, the State of Minnesota enacted legislation that includes helium exploration, production and for leasing on state lands. The new regulatory framework allows the State of Minnesota to issue leases for exploration and production of non-hydrocarbon gases (including helium), with Pulsar already having lodged an application for new leases in areas of interest for helium and hydrogen. Prior to the new regulations, leases could only be issued on mineral rights that are privately held, accordingly all of Pulsar's existing leases are with private entities.

Helium Contingent and Prospective Resources Report Prepared by Sproule, an Independent Evaluator

Pulsar is pleased to share summary estimates from its Contingent Resources and Prospective Helium and CO2Resources Report prepared by Sproule, an independent qualified reserves evaluator, dated August 21, 2024. All volumes are reported as unrisked and there is both a geological risk (Pg) and a Chance of Commerciality (Pc) that requires independent evaluation. The Chance of Commerciality (Pc) is the likelihood that the Topaz Project will, in a timely manner, be able to be commercialized. The Topaz Project has both commercial concentration helium (being not less than 0.5% by volume of gas) and CO2and there are no significant environmental nor logistical barriers to commercialization given its location. Therefore, given the Resource base, the Pc is fairly high for an early stage project with a value of 0.65.

The Contingent and Prospective Resources data presented in the 2024 Sproule Report was prepared in accordance with the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") as of July 31, 2024. No economic evaluation was performed Sproule for any of the assigned resources. The evaluation adheres in all material aspects to the principles and definitions in the COGE Handbook.

The Company is not deemed to be engaged in oil and gas activities and as such they are not required to disclose under National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities. Additionally, Helium is not a defined "Product Type" in NI 51-101. Consequently, any reference to contingent or prospective resources in the 2024 Sproule Report should not be interpreted in being prepared in accordance with NI 51-101.

Evaluated Helium Contingent and Prospective Resources as of July 31, 2024 (unrisked)

| Category / Level of Certainty | Recoverable

Contingent | Recoverable

Prospective | Recoverable

Contingent | Recoverable

Prospective | | | Gross (MMcf) | Gross (MMcf) | Net (MMcf) | Net (MMcf) | | Low Estimate | 3.2 | 53.5 | 1.6 | 11.5 | | Best Estimate | 22.9 | 380.2 | 5.9 | 40.3 | | High Estimate | 174.0 | 2,785.7 | 34.9 | 205.9 |

Evaluated CO2Contingent and Prospective Resources as of July 31, 2024 (unrisked)

| Category / Level of Certainty | Recoverable Contingent | Recoverable

Prospective | Recoverable

Contingent | Recoverable

Prospective | | | Gross (MMcf) | Gross (MMcf) | Net (MMcf) | Net (MMcf) | | Low Estimate | 24.2 | 410.2 | 11.9 | 88.0 | | Best Estimate | 171.8 | 2,862.1 | 44.6 | 303.7 | | High Estimate | 1,331.4 | 21,254.6 | 266.7 | 1,570.7 |

Notes:

1.

Low Estimate - P90; Best Estimate - P50; High Estimate - P10.

2.

The helium and CO2resources are presented in millions of cubic feet (MMcf), at base conditions of 14.65 psia and 60 degrees Fahrenheit.

3.

The resources are technical before any commercial or economic truncation.

The net resources stated are derived from Sproule's calculation of the Company's Net Revenue Interest in the applicable resource. Net Revenue Interest was calculated by taking the gross recoverable volumes attributable to a particular lease multiplied by the working interest and accounting for any royalties, severances or other payments required.

Additional Information Regarding the Contingent Resources

Contingent Resources are those quantities of gas estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development but which are not currently considered to be commercially recoverable due to one or more contingencies. There is uncertainty that it will be commercially viable to produce any portion of the resources. Contingent Resources do not constitute, and should not be confused with, reserves.

Four contingencies are identified for the Topaz Project development:

1) Evaluation Drilling & Testing: There is a requirement for more evaluation drilling to confirm the geological continuity of the reservoir and to reduce the uncertainty of the area of continuity of the reservoir from the proven productivity of the near wellbores. It is anticipated that as the Company continues to pursue primary development of the reservoir, commercial productivity will be established by testing closer to and within the primary production contingent resource areas, at which time this contingency would be removed.

2) Corporate Commitment: There has been no final investment decision and endorsement from the Company to move forward with commercial development of this asset. Gathering of the additional technical data is required to establish the commerciality of the project and make the final investment decision. Additionally, a detailed development plan has not been determined and further work needs to be completed to confirm how the resources will be developed. Currently, the Company is working on securing additional acreage by exercising lease options, pursuing additional lands, engaging vendors for drilling activities and engaging with local government and regulatory bodies. It is anticipated that as the development plan is refined the Company would be able to make a final investment decision, at which point this contingency would be lifted.

3) Market Access: There is a viable helium and carbon dioxide market in Minnesota. Considering the early stage of the project, the Company will be required to build helium extraction facilities as well as execute a helium and/or CO2sales contract to allow for the product to reach markets. Once determination of market access has been completed, or will be completed in the near term, this contingency may be lifted.

4) Demonstration of commerciality: Once the uncertainties on the reservoir size are reduced and the determination of market access has been negotiated the field development plan can be designed and the economics can be calculated to determine a basis for commerciality and reserve determination.

Additional Information Regarding the Prospective Resources

The estimated quantities of a gas that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable non-hydrocarbon gases.

Risk

The Topaz Project has twice flowed and tested helium and carbon dioxide gas in volumetrically significant percentages and both wells demonstrated shut-in pressures that indicated a reservoir that extended beyond the immediate area of the wellbores. The Jetstream #1 well has been logged, cored and with an optical televiewer log has confirmed the presences of open, gas filled fractures. Therefore, the Geological Chance of Success for the Contingent Resource (Pg) has been assessed as 0.95.

The Prospective Resources are defined by the integration of a variety of geophysical methods that have tied back to multiple boreholes, including the Jetstream #1 well. These resources by definition are untested and undrilled and have a much higher risk. The largest uncertainty is the ability to locate the fracture network with the drill bit and the amount of regional connectivity of the fracture network. The estimated Geological Chance of Success for the Prospective Resources is assessed as 0.25. The Company is planning additional 2D and 3D seismic data acquisition for the purpose of reducing these uncertainties and following the acquisition, processing and interpretation it is anticipated that the Pg of the Prospective Resources will increase.

The Chance of Commerciality (Pc) is the likelihood that the Topaz Project will, in a timely manner, be able to be commercialized. The Topaz project has both commercial grade helium and CO2and there are no significant environmental or logistical barriers to commercialization given its location. Therefore, given the Resource base, the Pc is fairly high for an early-stage project with an estimated value of 0.65.

AIM Dual-Listing and Financing

The Cornerstone Investment of £1.125 million will be made by way of a subscription for special warrants (the "Special Warrants") of the Company by Jerome Anthony Keen, a principal of OAK Securities (the "OAK Subscriber"), pursuant to a special warrant subscription agreement between the OAK Subscriber and the Company entered into on 21 August 2024. The Cornerstone Investment will be made by no later than 30 August 2024 and will form part of the £5 million that the Company is proposing to raise in connection with the AIM IPO.

The Special Warrants will entitle the holder on the exercise thereof to receive, without payment of any further consideration, such number of depositary interests over Common Shares equivalent to £1.125 million divided by the AIM IPO price, to be priced in the context of the market, subject to admission to trading on AIM of the Common Shares occurring by 31 October 2024 (or such later date as the OAK Subscriber, in its absolute discretion, may notify the Company in writing). If the AIM IPO has not occurred by 31 October 2024 (or such later date as the OAK Subscriber, in its absolute discretion, may notify the Company in writing), the Special Warrants will automatically be deemed exercised and entitle the OAK Subscriber to receive, without payment of any further consideration, such number of Common Shares equivalent to 1.2x the amount of the Cornerstone Investment (being C$2,400,000) divided by the market price of the Common Shares at that time, subject to receipt of TSX-V approval.