8th Nov 2024 12:30
(Alliance News) - Mendell Helium PLC on Friday said that M3 Helium Corp has bought interests in three further wells on the western side of the Hugoton gas field in Kansas.
Mendell Helium is a Perth, Scotland-based company switching to a helium production focus from health and wellness products.
In June, Mendell announced that it had an option to acquire M3 Helium, which is based in Kansas and holds an interest in six wells. There is no certainty that the option to acquire M3 Helium will be exercised, nor that the enlarged group will successfully complete its re-admission to trading on the AQSE Growth Market.
According to Mendell, two of the wells are in production, while the third is thought to be suitable for conversion into a water disposal well. The acquisition of the producing wells takes M3 Helium's total number of wells to eight, not including disposable wells.
M3 Helium has acquired an 85% interest in the Bearman, Demmit and Cockerham wells, which are all located on the western side of the Hugoton gas field in Stanton County, Kansas.
"Today's acquisition is a further example of the progress that M3 Helium is able to make due to its connections in the Kansas region. Whilst these are not going to be significant producing wells, the incremental production they will provide M3 Helium is at minimal cost. There is no obligation to spend any funds on the wells but, once the management evaluate the potential advantages of a disposal well, M3 Helium will be able to assess the economics of extending their production capabilities," said Chief Executive Officer Nick Tulloch.
Shares in Mendell Helium fell 1.0% to 3.71 pence each on Aquis on Friday afternoon.
By Holly Beveridge, Alliance News senior reporter
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