Blue Star Helium Ltd (ASX:BNL, OTC:BSNLF) is making progress with permitting of helium wells in Las Animas County of Colorado and four development well locations at Galactica/Pegasus are set for approval hearing this week.
The Colorado Oil and Gas Conservation Commission (COGCC) has advised that the Form 2A Oil and Gas Development Plan (OGDP) approval hearing date for the four planned helium development wells - State 09, 16, 35 and 36 - is set for September 14, 2022.
Development plan
These well locations are the first in the planned development of the helium discoveries at JXSN#1 and JXSN#2 in Galactica/Pegasus, which returned concentrations of up to 3.14% helium.
Blue Star plans to submit final permits to drill (Form 2) for these wells following location approval at the hearing.
Drilling of these wells will be scheduled as part of the plan of development for the Galactica/Pegasus area. This is likely to include drilling of an early well for additional pressure and flow analysis, with the further three wells being targeted for completion closer to the commissioning of the processing facility.
This best practice allows for limited time between drilling and exposing the helium reservoir and shutting the well in prior to tie-in to the production facility.
The current status of Blue Star’s helium well permitting activities in Las Animas County. The principal progress has been made at Galactica/Pegasus, Voyager and Serenity.
Further wells
A further seven development wells are in permitting process with the COGCC, which are also located to offset the JXSN#1 and JXSN#2 discovery wells.
Two additional OGDPs for eight additional wells offsetting the JXSN#3 discovery are being finalised for submission to the COGCC.
Eight additional development wells associated with the two further OGDPs offsetting the JXSN#3 discovery are not shown on the map nor are three additional proposed wells which are in preparation.
Progress at Sammons well
Meantime, progress is also being made at the Sammons 315310C well being drilled by Blue Star’s joint venture partner and AMI operator, Vecta Oil & Gas Ltd, on the Serenity prospect in Las Animas County.
Casing has been set at 1,270 feet in the shale that separates the upper and lower Lyons sands. This allows the upper Lyons to be preserved for future completion after showing high and increasing flow rates during testing while allowing the lower Lyons to be tested in isolation for accurate pressure, flow and compositional analysis of the lower sand.
Cementing operations were undertaken during the short Labor Day week with the cement bond log at the end of operations showing insufficient cement coverage from approximately 730 feet to surface.
Given the well is expected to encounter gas in the lower Lyons sand additional cementing operations have been conducted to provide sufficient bonding in the shallow section of the well.
Forward plan
At this stage, the forward plan is to run the cement bond log to confirm sufficient cement coverage and then to drill out any remnant cement in casing and drill into the lower Lyons sand.
Once in the lower Lyons the plan is to drill the first 20 feet of the sand for initial flow testing of the well for pressure and rate analysis and to collect gas samples to determine composition.
Sammons 315310C is one of four approved helium wells in the AMI agreed between Blue Star (50%, non-operated interest), Prospero Oil and Gas LLC (25%, non-operated interest) and Vecta Oil & Gas Ltd (25% operating interest).
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