Predator Oil & Gas, LON:PRD, the Jersey-based oil and gas exploration company with exploration plays in Morocco, Ireland and Trinidad and Tobago, is moving into the Helium market.
The Armchair Trader recently reported on the growing strategic importance of this lighter-than-air inert gas, when we covered the IPO of Pulsar Helium [LON:PLSR] on AIM earlier this month.
As reported, helium has many industrial uses, including semiconductor manufacture; in modular reactors to transfer heat from the reactor to a steam generator; MRI scanners, where helium is used to cool copper coils to convert them into a superconducting state; leak detection, which is essential in aerospace and engineering; in spacecraft to purge gas for hydrogen systems; fibre-optics; hard drive performance and of course deep-sea diving, as well as inflating party balloons.
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Excited about Snowcap
Predator, founded in 2017, has an exploration and production licence in Trinidad. It has been operating in the south of the island on the Inniss Trinity field. The upstream explorer has an 83% interest in the Cory Moruga licence it bought from AIM-listed Challenger Energy Group LON:CEG about a year ago. The Jersey-based company participates in the exploration through T-Rex Resources, a joint venture also shared by Touchstone Exploration [LON:TXP] through a non-operating participatory agreement. At the beginning of the year, it said it was excited at the prospects of the Snowcap Discovery, a virgin, undeveloped onshore field and initiated an accelerated three-year work programme to de-risk prospective resources identified in existing wells on the licence including well re-entries, workovers and new drilling to initiate production and cashflow
In Morocco, Predator has a 75% interest in the Guercif Licence together with its partner ONHYM, the Moroccan state oil company, and is another onshore development with four exploration permits covering an area of over 7,200 kilometres. The licence, which Predator entered in March 2019, is for eight years and is split into an initial period of 30-months; a first extension period of 36-months; and a second extension period of 30-months. After each licence period there is an opportunity to withdraw from the licence without entering the next licence period. Last year Predator extended the initial period of agreement by a further nine months to fifty-one months to allow for the acceleration of the one well commitment planned for the first extension period. Drilling the MOU-4 well in 2023 removed the drilling commitment from the first extension period and eliminated the requirement to put up a new bank guarantee in favour of ONHYM prior to entering the first extension period.
It is in Morocco that Predator sees the potential for helium on the back of an independent report it commissioned from Scorpion Geoscience that assessed the potential conventional prospective gross recoverable gas resources from its MOU-5 well is up to 5.9 trillion cubic feet (TCF) with a helium yield of 104.3 billion cubic feet (BCF). The company paid its advisors – aligning them with the Moroccan direction of travel – through issuing GBP138,000 of shares in lieu of services.
Predator Oil & Gas losses narrowing
In its last set of results to end-June, Predator reported a GBP978,238 loss for the six months, which compared favourably to the GBP2.4m loss Predator made for the same period in 2023 and had about GBP4.3m in cash in the bank on top of GBP1.2m restricted cash with no debt which meant that the company could fully-fund its operations for the next twelve-months.
Predator also has a 50% interest in licencing option 16/26, known as Corrib South in Ireland which its shares with Theseus, a private company. The oil exploration business opened the week (28th October) at 7.02p, down 34.7% over one-year and down 26% year-to-date. Predator has a market cap of GBP40m.
