As of October 2021, Royal Helium holds 348,908 hectares (862,908 acres) of prospective helium rights comprised of 79 five-year permits and 21-year leases across southern Saskatchewan.
Royal's helium lease/permit land is comprised of 10 main blocks spanning southwestern to southeastern Saskatchewan. Exploration drilling was initiated in 2021 at the Climax block in the southwest resulting in the discovery of the Climax Nazare zone and is subject to further production wells being drilled. Drilling in the southeastern side of the province has been initiated on the Ogema block. Royal has plans to fully explore and develop each of the blocks with detailed seismic, geophysics and drilling. The initial, fully funded budget for 2021 – Q1 2022 is for 10 wells in total to be drilled.
Exploration plans are to drill test 30 structures of similar size to the existing Wilhelm and Mankota helium pools. To identify these structures, the company is using a combination of seismic data, well logs and aeromagnetic surveys.
The seven drill targets at Climax were identified in late 2019 after the company first reprocessed 77.6 km of 2D seismic in conjunction with historic well logs and delineated a basement structure of ~3,094 hectares of four-way structural closure. Another 17,676 hectares of helium permits (100% crown) located immediately west of its Climax property were then granted in November 2019. To further define the possible inert gas/helium bearing formations and refine company target wells, a deep, detailed aeromagnetic survey was flown over the Climax central structure in May.
In January 2021, Royal Helium commenced its maiden drill program on the Climax land block and drilled three wells to a total depth (TD) of approximately 2600 metres. Economic helium concentrations were announced in April 2021, with tests returning levels ranging from 0.33% to 0.64% helium from the Deadwood, Souris River and Duperow formations, with initial high-graded production zones being tested ranging in thickness from five meters to in excess of 30 meters.
Subsequently, further examination and interpretation of drilling at the Climax project discovered a 39-meter helium bearing zone at Climax-3 in the basal Deadwood "Regolith" which was a previously unknown helium bearing sequence. The same zone was also intersected at Climax-2 and the Company seismically mapped the new zone, renamed the Climax "Nazare" zone, over a total area of 32 square kilometers (12.3 mi2). Based on internal estimates, Royal estimates total helium in-place within the Climax Nazare zone across the prospective area to be between approximately 2.5 billion cubic feet ("Bcf") (low-case) and 6.0 Bcf (high case).
A fourth well at Climax, designed to be a production offset to Climax-3 to specifically target the newly discovered Nazare zone, was drilled in August 2021. Climax-4 had the highest and most consistently elevated helium shows to date on the Climax block. The Nazare zone was cored so that an extensive geotechnical program on the rock could be undertaken. The testing program also included a series of drillstem tests over a 120m zone that tested some 0.64% helium and also provided valuable information concerning flow rates, pressures, and permeabilities for the Nazare zone. This information was used to design a completions program, which will be completed in Q4 2021. Based on the results to date at Climax, Royal Helium has expanded the development program for the Climax Group and has applied for 2 additional well licences on the block.
In addition to the development work at Climax, the Company intends to drill additional helium wells in the Southeast land blocks, an area that historically contains some of the highest helium shows in the Province. Royal has completed its seismic evaluations and is undertaking the work required to license two exploratory wells each at the Bengough and Ogema blocks.