Helium One Global confirms free gas at Jackson-2, reinforces strategic push in Colorado and Tanzania

Why Is Helium One Global’s Jackson-2 Gas Discovery a Strategic Milestone?

Helium One Global Ltd (LSE: HE1), the AIM-listed helium exploration company, has successfully drilled and confirmed free gas at its Jackson-2 well in Colorado, deepening its footprint in the strategically critical helium sector. The well, part of the Galactica-Pegasus development project operated by Blue Star Helium Ltd (ASX: BNL), was drilled to a total measured depth of 1,232 feet and intersected a 73-foot interval of gas-saturated, high-porosity sandstone in the Upper Lyons Sandstone Formation. The natural gas flow encountered during and after drilling, alongside the absence of water, confirms strong reservoir potential.

This development marks the fifth successful well in the Galactica campaign, cementing Helium One’s entry into the North American helium market and diversifying its exploration risk beyond East Africa. The Jackson-2 find comes at a time when global helium prices remain elevated due to constrained supply from traditional producers such as the U.S. Bureau of Land Management and Qatar, creating urgency among advanced technology and healthcare industries for reliable new sources.

What Does Jackson-2 Reveal About the Galactica-Pegasus Project’s Potential?

The Jackson-2 well targeted the high-grade Upper Lyons Sandstone, achieving continuity with earlier successful wells — Jackson-27, Jackson-29, Jackson-31 and Jackson-4. Petrophysical data from offset wells suggests porosity levels between 22% and 26%, indicative of a high-quality reservoir. Importantly, no water was detected during drilling, and early gas samples, while air-contaminated, are currently undergoing lab analyses for helium and CO₂ content.

Helium One and Blue Star Helium are preparing the wellhead installation for surface pressure measurement and formal flow testing. The rig will soon mobilise to the sixth and final well site, State-9, concluding the current development campaign. Blue Star will then assess the full drilling programme and initiate planning for infrastructure build-out, including processing facilities and pipeline tie-ins.

What Is Helium One’s Role in the Galactica Development?

Under a farm-in agreement, Helium One is funding the first US$450,000 of drilling costs at Jackson-2 in exchange for a 50% working interest in the Galactica-Pegasus helium development. The broader Galactica region, discovered by Blue Star in 2022, offers multi-well development potential and is bordered by third-party projects like Red Rocks, which enhance the regional infrastructure outlook. The success of Jackson-2 strengthens the case for early-stage commercialisation of the project and supports Helium One’s ambitions to become a diversified helium supplier across two continents.

The North American helium strategy complements Helium One’s domestic exploration portfolio in Tanzania, giving the company a de-risked, dual-hemisphere exposure to one of the world’s most supply-constrained critical commodities.

How Are Helium One’s Tanzanian Projects Progressing?

In Tanzania, Helium One holds 100% equity in two key projects: Rukwa and Eyasi. The company’s flagship Rukwa Project, located in the southern Rukwa Rift Basin, has transitioned into an appraisal stage following a successful 2023–2024 exploration campaign. At the Itumbula West-1 well, Helium One achieved a breakthrough by flowing 5.5% helium to the surface in Q3 2024—one of the highest recorded concentrations globally.

In September 2024, the company submitted a Mining Licence application for a 480 km² area encompassing the Rukwa discovery, which was granted in March 2025 by the Tanzanian Mining Commission. This regulatory milestone positions Helium One to begin phased development in East Africa, potentially adding a long-term production leg alongside its more immediate U.S. opportunity.

Meanwhile, the Eyasi Project in northern Tanzania remains at a prospecting stage but has returned surface seep readings of up to 10.4% helium. Its rift basin setting, similar to Rukwa, enhances geological confidence in its long-term value.

How Are Investors Reacting to Helium One’s Dual-Market Strategy?

Stock sentiment for Helium One Global Ltd has turned notably positive following the Jackson-2 gas discovery. As of May 9, 2025, HE1 shares on the LSE closed at £0.905, reflecting a recovery from a 52-week low of £0.50. However, it remains significantly below its August 2024 high of £2.15, highlighting the stock’s volatility amid exploration risk and macroeconomic headwinds.

Trading volumes surged past 64 million shares following the well update, suggesting a resurgence of institutional and retail participation. The stock is currently in a mid-range trading zone, with technical analysis platforms like StockInvest.us projecting potential downside risk of around 5.3% over the next quarter due to resistance at the £1.10 level.

Still, analyst consensus remains strongly bullish, with Investing.com and other platforms giving Helium One a “Strong Buy” rating. The 12-month price target is pegged at £3.60—an upside of over 290% from current levels—based on the successful de-risking of Jackson-2 and the grant of the Tanzanian mining licence.

Is Helium One a Buy, Sell or Hold?

Investment Recommendation: Hold

Helium One is now transitioning from speculative exploration into early-stage production readiness. While the stock remains volatile, its recent execution success, balanced asset base, and positive institutional sentiment suggest further upside potential in 2025. Investors with existing positions may consider holding until flow test results and production infrastructure timelines are finalised.

For new investors, the stock offers an attractive entry point for long-term exposure to helium—a critical mineral with no known substitute in many industrial and medical applications. That said, timing will be crucial, and clarity from Jackson-2’s test results and the State-9 campaign will be key catalysts.

What About Blue Star Helium’s Market Position?

Blue Star Helium Ltd (ASX: BNL), operator of the Galactica project, is in a more precarious financial position. Its share price recently dropped 25% to AU$0.006 but remains up 100% over the past quarter. The company reported a net loss of AU$13.06 million for the last fiscal year and has limited revenue visibility.

Its market cap stands at AU$21.56 million with over 2.6 billion shares in issue. Weekly price swings average 34.1%, marking it as a high-volatility, high-risk equity. While it continues to deliver on exploration objectives, the company’s balance sheet limitations and dilution risks remain key concerns.

Investment Recommendation: Sell

Given its financial losses and extreme volatility, Blue Star may be best suited for short-term speculative traders rather than long-term investors. Until the company secures external financing or transitions into production with Helium One’s support, its stock may remain under pressure.

What Does Institutional Flow Data Suggest?

Detailed institutional and FII/DII flows for Helium One and Blue Star remain sparse due to their small-cap status. However, social sentiment and trading data from platforms like LSE.co.uk and TradingView confirm elevated investor interest, particularly in HE1 following the Jackson-2 update.

OTCQB trading under ticker HLOGF in the U.S. has also spiked, reflecting growing international investor interest in Helium One’s dual-market model. If commercial flows are confirmed at Jackson-2 and State-9, the company may attract passive capital from critical mineral ETFs and commodity-focused funds.

What’s Next for Helium One Global?

The remainder of 2025 will be pivotal. Helium One and Blue Star are expected to complete flow testing at Jackson-2 shortly and spud the State-9 well soon after. These results will determine the timing and scale of infrastructure buildout, including processing units and pipeline integration.

In Tanzania, dry season logistics will determine the next phase of appraisal or pilot production. The award of the mining licence paves the way for discussions with offtakers, potential JV partners, or infrastructure investors.

Analysts expect Helium One to announce early-stage commercial development milestones by H1 2026, with near-surface Rukwa production potentially outpacing the more infrastructure-heavy U.S. projects in terms of first helium sales.