Pulsar Helium: High-Grade US Discovery Nears Production

• Pulsar Helium is a dedicated helium exploration company advancing projects in the U.S. and Greenland
• Its flagship Topaz project in Minnesota has encountered high helium concentrations up to 14.5% with no associated water
• Pulsar recently deepened its first discovery well and is drilling a second well to further delineate the resource
• The company aims to reach a final investment decision (FID) on initial helium production within the next 24 months
• Pulsar sees strong fundamentals for the helium market driven by tech applications and declining U.S. production

Helium is a critical and irreplaceable commodity that plays an essential role in numerous high-tech applications, from semiconductor manufacturing and MRI scanners to space exploration. Despite its importance, the global helium market faces significant supply challenges due to the scarcity of primary helium sources and the industry's dependence on helium as a byproduct of natural gas production.

Pulsar Helium is a pure-play helium explorer dedicated to advancing a portfolio of high-potential helium projects in stable jurisdictions. The company's flagship Topaz project in Minnesota has already delivered encouraging results, encountering helium concentrations as high as 14.5% with no associated water.

The Topaz Discovery

Pulsar Helium's journey at the Topaz project began in 2021 with the acquisition of the project, which had previously been drilled by another company exploring for nickel. That initial drilling encountered high helium concentrations, providing the foundation for Pulsar to secure the asset and launch a focused helium exploration campaign.

In 2024, Pulsar drilled the Jetstream-1 well, its first well at the Topaz project, to a depth of 2,200 feet. The results were exceptional, with the well encountering helium concentrations up to 14.5% that flowed naturally to surface without any associated water. This significant discovery put Topaz on the map as a potential game-changer for the North American helium market.

Expanding the Resource

Building on the success of the Jetstream-1 well, Pulsar has embarked on an ambitious program to expand and delineate the helium resource at Topaz. The company recently completed deepening the discovery well to a total depth of 5,100 feet, with indications of additional helium-bearing reservoir rock encountered during drilling.

As Pulsar Helium CEO Thomas Abraham James explained in a recent interview,

We put a rig back onto that well and then we went and we lengthened it, and we had a miss-eye with the data there going to be about another 1,600 feet worth of potential helium-bearing reservoir. In fact, it seems to be thicker than that, and we drilled down to a maximum depth, the total depth of 5,100 feet.

In parallel with the deepening operation, Pulsar is also drilling the Jetstream-2 well nearby to further prove up the extent of the reservoir. The company is employing air drilling, a technique that allows for faster penetration through the competent crystalline basement rock at Topaz. While the air drilling provides underestimates of the actual helium concentrations due to dilution with atmospheric air, at levels up to 7.24%, these are still observed highly encouraging results.

Interview with CEO Thomas Abraham-James

Path to Production

With the resource potential at Topaz continuing to grow, Pulsar Helium has a clear roadmap to advance the project towards commercial helium production. The company is working with industry-leading partners to design and engineer the processing facilities that will be required to separate the helium from the raw gas stream.

We have - a couple of months ago - announced to the market that we have signed an agreement with a company called Chart Industries. Chart Industries is a U.S multi-billion-dollar company, and what they specialize is in the design, the engineering, and then the fabrication and installation of large industrial gas facilities, amongst other things.

The helium processing plant envisioned for Topaz would be modest in scale compared to a typical natural gas facility, with the key steps being the separation of carbon dioxide followed by the cryogenic distillation of the helium. The carbon dioxide itself represents a potential value-added product, with strong demand in the regional market.

Pulsar's goal is to reach a final investment decision (FID) on initial production at Topaz within the next 24 months. To support this objective, the company is advancing a multi-pronged work program including the analysis of drilling results, preparation of an updated resource report, completion of economic studies in partnership with Chart, and the acquisition of additional geophysical data over the project area.

Our intention is in the next 24 months to get to a point where it's final investment decision for proceeding with production. So that's what we're working hard on.

Once FID is achieved, Pulsar anticipates an 18-month timeline to design, fabricate, construct, and install the production facilities, culminating in the commencement of commercial helium sales from the Topaz project.

Market Fundamentals

The investment thesis for Pulsar Helium is underpinned by robust market fundamentals for helium, with demand growth being driven by high-tech applications in sectors like semiconductor manufacturing, MRI scanners, and space launch vehicles. At the same time, supply remains constrained due to the lack of primary helium production and the industry's dependence on helium as a byproduct of hydrocarbon production.

More than 95% of the world's helium production is as a byproduct of natural gas. There's no flexibility whatsoever. Even if a customer doesn't need product [helium] for whatever reason for a particular month, they're still being forced fed it and then it's just wasted as it [gas] will vent off to the atmosphere. So, there's no flexibility in it.

This lack of flexibility in the supply chain, combined with rising demand and declining production from the U.S. Federal Helium Reserve, has created opportunity for new entrants like Pulsar to capture market share. The company's focus on low-cost, high-concentration helium production from the Topaz project positions it to be highly competitive in this evolving market landscape.

The Investment Thesis for Pulsar Helium:

• Pure-play helium exploration and development company focused on low-risk jurisdictions
• Flagship Topaz project in Minnesota has demonstrated high helium concentrations up to 14.5% with no associated water
• Near-term catalysts include results from ongoing drilling and testing program to expand and delineate the resource
• Objective to reach FID on initial helium production within 24 months, with first production 18 months thereafter
• Strategic partnership with industry leader Chart Industries for plant design and engineering
• Compelling market fundamentals with growing helium demand and lack of primary supply
• Opportunity to gain exposure to critical helium market in advance of potential re-rating as Topaz advances towards development and production

The Helium Macro Thematic:

The global helium market is at an inflection point, with growing demand driven by high-tech applications bumping up against scarcity of primary supply. As the U.S. Federal Helium Reserve winds down sales, the market is looking to new sources to meet rising consumption from sectors like semiconductor manufacturing, MRI scanners, and space launch.

This supply crunch is exacerbated by the industry's dependence on helium as a byproduct of hydrocarbon production, leaving the market beholden to the vagaries of oil and gas economics. The lack of flexibility in this model has created a compelling opportunity for primary helium producers able to directly tap into the expanding market.

Against this constructive demand backdrop and challenges for byproduct supply, the stage is set for the ascendance of pure-play primary helium producers. These emerging companies offer investors the opportunity to gain leveraged exposure to the increasingly strategic helium market while diversifying away from the risks and constraints inherent in byproduct sourcing.