VVC's PHC Drills the First Two New Wells in its Syracuse Project - Contracts Given for the Syracuse Project Gas Gathering System
TORONTO, Sept. 28, 2021 (GLOBE NEWSWIRE) -- VVC Exploration Corporation ("VVC" or the "Company") (TSX-V:VVC) is pleased to announce that its wholly owned subsidiary Plateau Helium Corporation (PHC) has drilled two new gas wells on the Syracuse Project, each of which showed two zones of helium gas. PHC has contracted with TMI Solutions, LLC for engineering and with Eatherly Constructors, Inc to build an internal gas gathering system for the Syracuse Project. PHC continues to acquire additional helium lease acreage as it expands its footprint in the helium business and commences commercial helium and natural gas production at the Syracuse Project.
Incredible Progress by PHC
VVC President Jim Culver took the opportunity to praise the PHC team for the incredible business progress since VVC took over PHC. "These two wells mark the beginning of commercial helium and natural gas production in our Syracuse Project. Eight (8) more wells are permitted and being prepped for drilling. In addition to the four (4) helium projects that PHC now has, it continues to look for opportunities in the helium sector. I want to thank the Team for their hard work and VVC’s investors and shareholders for supporting this transformative effort."
He also noted that VVC recently acquired an investment position in a promising startup resource company, Plateau Carbon LLC (PCL). PCL has since acquired a large industrial gas lease holding that includes carbon dioxide ("CO2"), nitrogen and helium. Plateau Carbon's primary purpose is the geologic sequestration of CO2 in an effort to aid in the reduction of US carbon emissions. The secondary focus is the production and sale of helium.
Commencement of Commercial Production on Syracuse Project
The Durler 2-21 is the first new well drilled on the Syracuse Project and two gas zones were encountered. One zone was perforated and flowed gas while and the second zone indicates gas but has not yet been tested. The well will be completed and connected to the pipeline as soon as the internal gas gathering system connection is available, sometime in Q4, 2021.
PHC’s second Syracuse well is the Levens #2. The same two gas zones were encountered in Levens #2 as in the Durler 2-21. This well was perforated in the same zone as the Durler 2-21 and also flowed gas. And like the Durler 2-21, an additional zone indicative of gas production was encountered which has not yet been perforated. Levens #2 is located very near the Tumbleweed pipeline and is scheduled to be completed, tested and connected to the Tumbleweed pipeline by mid-October.
Site preparation has begun on 8 additional newly permitted Syracuse well locations with drilling to commence in Mid-October 2021 and be completed in December 2021. PHC expects to have a total of ten (10) new wells completed and producing in the Syracuse Project by the end of December of 2021.
The Company also plans to drill twenty (20) additional new wells in Syracuse in the first half of 2022.
Syracuse Internal Gathering System and Tumbleweed Pipeline Connection
PHC has contracted with TMI Solutions, LLC for engineering and Eatherly Constructors for construction of an internal gas gathering system in the Syracuse project. The core of this gathering system will start at the Levens #2 well and connect the Durler 2-21 and the eight (8) other wells to be drilled before the end 2021, in an approximately 15-mile system. This Syracuse Gathering System will provide convenient connector points for balance of the 160 potential well sites in the Syracuse Project.
Continued Acreage Acquisition and Expansion of Syracuse Extension
PHC’s Syracuse Extension has been divided into two separate projects. The first, includes leases in two (2) counties in Western Kansas, now referred to by the Company as Syracuse Extension Kansas; the second includes leases in four (4) counties in Eastern Colorado now referred to by the Company as Syracuse Extension Colorado. Historically, the leases in these two projects was evaluated by proximity to historical wells that tested helium rich natural gas. Because of low natural gas prices at the time of drilling, and lack of access to helium processing these wells were not completed, nor put into production, and were subsequently plugged.
PHC's Helium Projects
PHC now has four (4) helium projects, presently covering an aggregate of approximately forty thousand (40,000) acres: the original Syracuse Project, Monarch Project, Syracuse Extension Kansas, and Syracuse Extension Colorado. Upon completion of the core leasing, the total leases in these four (4) projects is expected to be over seventy-five thousand (75,000) acres with over six hundred (600) potential well locations. In addition to the core acreage in each of these projects, the Company will continue to add properties to each project on an "as available" basis.
- The Syracuse Project initially consisted of 13,440 acres of gas leases located in Hamilton County, Kansas. PHC continues to add to the leased acreage on an opportunistic basis with the present total standing at over 16,000 acres. This project is the focus of PHC’s initial new well drilling and production campaign. Two (2) new wells have been drilled, and are awaiting testing, completion and pipeline connection. Eight (8) more well sites have been permitted and site work has begun. Drilling is scheduled to begin in mid-October with completion, including pipeline connection, before year end. The first new well is expected to be connected to the pipeline in October.
- The Monarch Project consists of 1,600 acres of gas leases located in Greeley County, Kansas with six existing wells that are in the late stages of their productive life. At this time, five (5) of these previously producing wells have been re-connected to the pipeline and are producing helium rich gas. The focus in this Project is the 14 additional potential well locations which are conveniently located for connection to the Tumbleweed pipeline.
- Syracuse Extension Kansas’s initial targeted acreage was 8,540 acres of which 3,320 acres have completed leases and still 5,220 acres are in process. The targeted acreage has twenty-four (24) wells on acreage already leased and 17 on acreage, in process, that were previously drilled and tested helium rich natural gas but were plugged for lack of a viable market. Other acreage will be added to this Project as it is available. The project with its present leased acreage has 138 potential well locations. Initial new well drilling is scheduled to commence in Syracuse Extension Kansas in Q4 of 2021. Six wells are currently in the process of being permitted.
- Syracuse Extension Colorado has now leased 17,747 acres of its targeted core of 20,187. In addition, PHC is completing a development contract with a major mineral owner for an additional 28,160 acres. There are a total of 28, tested but not producing wells in the project. The Company expects to complete this leasing and contracting by the end of October. PHC has begun the permitting process for the first Syracuse Extension Colorado wells and expects to drill the first well in Q1 2022.
Helium Value
Helium prices and demand have continued to increase as the US Strategic Helium Reserve has been depleted. In addition to the more traditional uses in welding and industrial processing, helium is a key item in high tech manufacturing, medical devices and space programs.
Global Investment Daily described the ' Helium Boom that is about to take off in 2021 ' (https://globalinvestmentdaily.com/the-helium-boom-is-about-to-take-off-in-2021) and price wise it certainly has. Long term contract prices for helium (five-year and ten-year contracts) have increased by as much as 25% during 2021, and spot prices in some cases appear to have doubled, making helium one of the most profitable commodity products in the last five years. Even at the low end of the range for the projected five-year average price for helium, PHC could have a significant profit margin on its helium business based on the costs to date for drilling and servicing wells and the existing contract price for helium.
A few companies are now pursuing helium production, but the areas where commercial helium wells have been found are limited. PHC has been aggressively acquiring lease acreage in areas where there has been past production of helium, to allow the Company to grow its helium business rapidly.
PHC’s helium business has the potential to become highly profitable if it can ramp up commercial production over the next 24 months and continues to acquire leases that have a high likelihood of profitable helium production.
About VVC Exploration Corporation
VVC is a publicly traded Canadian-based mining exploration and development company listed on the TSX Venture Exchange (TSX-V:VVC). With the addition of PHC, VVC is also a Helium producing company. VVC’s portfolio includes the Gloria Copper Project in Northern Mexico, precious metals properties also in Mexico and the Helium Projects owned by its wholly owned subsidiary, Plateau Helium Corporation ("PHC"). VVC is currently focused on the Helium Projects owned by PHC and will resume the development of Gloria Copper Project, as soon as Covid-19 restrictions are removed in Mexico. To learn more, visit our website at: http://vvcexpl.com.
On behalf of the Board of Directors
Michel J. Lafrance, Secretary-Treasurer
| For further information, please contact: | |
| Patrick Fernet - (514) 631-2727 or | Trevor Burbank - (214) 641-1041 |
| pfernet@vvcexploration.com | trevor@vvcexpl.com |
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FORWARD LOOKING STATEMENTS:
FORWARD LOOKING STATEMENTS:
This news release contains "forward-looking information" (within the meaning of applicable Canadian securities laws) and "forward -looking statements" (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995). Such statements or information are identified with words such as "anticipate", "believe", "expect", "plan", "intend", "potential", "estimate", "propose", "project", "outlook", "foresee" or similar words suggesting future outcomes or statements regarding an outlook. Such statements include, among others: Eight more wells ...are being prepped for drilling; an investment position in a promising startup resource company; well will be completed and connected to the pipeline ... sometime in Q4, 2021; Levens #2 is scheduled to be completed, tested and connected to the Tumbleweed pipeline by mid-October; PHC expects to have a total of ten (10) new wells completed and producing by the end of December of 2021; also plans to drill twenty (20) additional new wells in the first half of 2022; Syracuse Gathering System will provide convenient connector points for balance of the 160 potential well sites in the Syracuse Project; drilling is scheduled to begin in mid-October with completion including pipeline connection before year end; the first new well is expected to be connected to the pipeline in October; other acreage will be added to this Project as it is available; the project with its present leased acreage has 138 potential well locations; Initial new well drilling is scheduled to commence in Syracuse Extension Kansas in Q4 of 2021; Company expects to complete this leasing and contracting by the end of October; PHC has begun the permitting process for the first Syracuse Extension Colorado wells and expects to drill the first well in this Project in Q1 of 2022; PHC could have a significant profit margin on its helium business; PHC has been aggressively acquiring lease acreage in areas where there has been past proven production of helium, in order to position the company to grow its helium business rapidly; PHC’s helium business now has the potential to become highly profitable if it can ramp up commercial production over the next 24 months and continues to acquire leases that have a high likelihood of profitable helium production; etc.
Such forward-looking information or statements are based on a number of risks, uncertainties and assumptions which may cause actual results or other expectations to differ materially from those anticipated and which may prove to be incorrect. Assumptions have been made regarding, among other things, management's expectations regarding acquisitions, production of helium, future development and growth, plans for and completion of projects by Company’s third-party relationships, availability of capital, and the necessity to incur capital and other expenditures. Actual results could differ materially due to a number of factors, without limitation, operational risks in the completion of Company’s anticipated projects, delays or changes in plans with respect to the development of Company’s anticipated projects by Company’s third-party relationships, risks related to Covid-19, risks affecting the ability to develop projects, risks in legislative changes in the applicable jurisdictions, risks in decrease of price of helium. No assurances can be given that the efforts by Company will be successful.
Although the Company believes that the expectations reflected in the forward-looking information or statements are reasonable, prospective investors in the Company's securities should not place undue reliance on forward-looking statements because the Company can provide no assurance that such expectations will prove to be correct. Forward-looking information and statements contained in this news release are as of the date of this news release and the Company assumes no obligation to update or revise this forward-looking information and statements, except as required by law.
Investors are cautioned that notwithstanding the expectations described herein, there can be no assurance that the plans described herein will be completed as proposed or that the results will be as expected. Trading in the securities of VVC should be considered highly speculative. All forward-looking statements contained in this press release are expressly qualified in their entirety by these cautionary statements and by those made in our filings with SEDAR in Canada (available at www.sedar.com).
