Helium One’s latest Galactica Project update hints at big helium gains

Helium One Global, the AIM-listed helium exploration company, has provided a crucial helium drilling update regarding the Jackson-31 well, a key component of the Galactica Project progress in Colorado, USA. Holding a 50% working interest in the Galactica-Pegasus helium development, Helium One is advancing efforts alongside Blue Star Helium, the project’s operator, to bring new helium reserves into production.

The latest announcement confirms that the drilling rig has now been mobilised to the Jackson-31 well location in Las Animas County, Colorado. Site preparations, including the delivery of casing materials, were completed in mid-January 2025, allowing for the rigging-up process to begin. However, winter conditions in Colorado have introduced logistical challenges, prompting Blue Star Helium to undertake road gravelling operations to maintain accessibility.

While drilling was initially scheduled to commence in late January, the operator has decided to postpone the rig move due to anticipated snowfall and adverse weather. Mobilisation is now expected to begin in early February, with drilling operations commencing shortly after. This adjustment is intended to prevent operational disruptions caused by extreme weather conditions, ensuring a smoother execution of the Galactica Project progress.

Why is the Galactica Project significant for Helium One?

The Galactica Project progress represents a major strategic development for Helium One and Blue Star Helium as they work to tap into high-purity helium reserves in Las Animas County. The project, which spans 246 km², has already yielded promising helium concentrations from confirmed discovery wells, with some testing as high as 6% helium by volume, while the average remains at 3%. These results underscore the project’s potential as a key supplier to the global helium market, which continues to face supply constraints.

The Jackson-31 well is the first in a series of planned wells within the Galactica-Pegasus development area. Following its completion, drilling will move to the Jackson-4 well, with additional wells included in the broader programme. The final sequence of these additional wells will be determined based on findings from initial drilling activities. Helium One’s confidence in the site is reinforced by its proximity to existing helium processing infrastructure, which allows for efficient production and distribution once extraction begins.

How will weather conditions impact the Jackson-31 well timeline?

Severe winter weather in Colorado has presented operational challenges, particularly in ensuring reliable access to the well sites. To mitigate these issues, Blue Star Helium has undertaken a significant effort to gravel the roads leading to the Jackson-31 well and Jackson-4 locations. This measure is critical for maintaining year-round accessibility, as fluctuating snow and thaw conditions can impact vehicle and equipment movement.

Despite these proactive efforts, the ongoing adverse weather has necessitated a delay in rig mobilisation. The operator now aims to commence the move in early February, ensuring a safer and more controlled start to drilling. Such adjustments are not uncommon in regions affected by seasonal extremes, and Helium One remains confident that these short-term delays will not significantly impact the overall Galactica Project progress.

What are the production expectations for the Galactica Project?

Helium One and Blue Star Helium are moving forward with an ambitious development plan that includes an initial phase of six development wells, funded through a capital raise in August 2024. Once completed, these wells are expected to generate sufficient cash flow to finance the drilling of an additional nine wells, bringing the total to 15 production wells. This phased approach ensures that helium extraction is scaled efficiently while maintaining financial sustainability.

An independent third-party assessment has projected that the Jackson-31 well and other development wells in the Galactica-Pegasus area could contribute an estimated US$2 million per annum in helium sales over a five-year period. However, this figure represents revenue from helium alone. Helium One anticipates that sales of associated CO2 from the site could increase revenue by up to 50%, providing additional commercial opportunities for the project.

What is the future outlook for Helium One’s helium exploration efforts?

Beyond the Galactica Project progress, Helium One continues to strengthen its position in the helium exploration industry through its diverse portfolio of assets. In Tanzania, the company holds 100% equity in the Rukwa and Eyasi projects, which have shown high helium concentrations of up to 10.4% by volume. The flagship Rukwa Project is now entering an appraisal phase following a successful 2023/24 exploration campaign.

The strategic expansion into the United States, through the 50% stake in the Galactica-Pegasus helium development, complements Helium One’s African operations and broadens its market exposure. The company remains committed to capitalising on the growing demand for helium, a critical resource used in medical imaging, space exploration, and semiconductor manufacturing.

As drilling preparations for the Jackson-31 well continue, industry analysts will closely monitor the results from Helium One’s exploration activities. If successful, this drilling campaign could provide a significant boost to global helium supplies at a time when demand remains strong. The company’s methodical approach to project execution, combined with its access to existing infrastructure, positions it as a key contender in the future helium market.