Mendell Helium plc, previously Voyager Life plc, is undergoing a transformation as it shifts focus from wellness products to becoming a prominent helium producer. Listed on the Aquis Stock Exchange under the ticker MDH, the company’s strategic pivot is centred on a game-changing opportunity in the North American helium market, with interests in high-grade helium wells in Kansas.
The Opportunity in Helium: Why It Matters
Helium is a critical resource with unique properties that make it indispensable in various industries. From scientific research and medical technologies like MRI machines to space exploration and semiconductor manufacturing, helium’s demand is accelerating. However, helium supply is finite, with much of it extracted as a by-product from natural gas fields. This makes the Hugoton gas field in Kansas—home to some of Mendell’s wells—a strategic asset, offering reliable, high-concentration helium production in a region with established infrastructure.
Acquiring M3 Helium: A Transformative Step
Mendell Helium’s journey toward acquiring M3 Helium Corp. continues to progress, demonstrating the company’s commitment to becoming a significant player in helium production. Initially announced in June 2024, the option agreement to acquire M3 Helium has now been extended to January 31, 2025, providing crucial time to finalize the transaction and strengthen operations. M3 Helium operates six wells in southwestern Kansas, with three—Peyton, Smith, and Nilson—already in production and generating revenue. A fourth well, Rost, located in Fort Dodge and boasting a helium concentration of 5.1%, is expected to begin production shortly. These wells are strategically positioned near the Hugoton gas field, one of North America’s largest natural gas reserves, ensuring easy access to critical infrastructure, including Scout Energy Partners’ gathering network and the Jayhawk gas processing plant. This proximity allows for efficient and cost-effective helium delivery to the market.
Recent operational achievements include the integration of the Smith and Nilson wells into the local gathering system, while a second and significantly larger frack was successfully completed at the Nilson well. This ambitious operation used 210,000 gallons of gelled water, surpassing initial estimates, with peak pressures reaching 1,500 psi. These enhancements are expected to substantially boost production, and the well’s performance will be closely monitored over the coming weeks. The Rost well, while not directly connected to the gathering network, offers flexibility for onsite purification using M3 Helium’s mobile PSA plant, further demonstrating the adaptability of the company’s approach.
Since the agreement’s announcement, M3 Helium has drawn approximately $487,000 from Mendell’s loan facility to support these advancements. This disciplined financial management, combined with strategic investments, highlights Mendell’s focus on creating a scalable and efficient production model. The company has also taken significant steps toward completing the regulatory and administrative requirements for the acquisition, including audits and the preparation of a competent person’s report.
Strategic Assets in the Hugoton Gas Field
The Hugoton gas field is one of North America’s largest and most established natural gas fields. Five of M3 Helium’s wells are situated here, strategically near a robust gathering network and the Jayhawk gas processing plant. This proximity allows for efficient integration of producing wells into the infrastructure, minimizing development costs and maximizing production scalability.
The Nilson well is a standout asset, ranking among the top 1% of producing wells in the Hugoton field by volume. With increased output, Nilson demonstrates the field’s long-term production potential and underscores Mendell’s capacity to capitalize on high-value assets.
Fort Dodge: A High-Grade Helium Prospect
The Fort Dodge well, tested in July 2024, showed an impressive helium concentration of 5.1%. While this well is not directly connected to the existing infrastructure, M3 Helium owns a mobile Pressure Swing Adsorption (PSA) production plant, enabling onsite helium purification. This flexibility ensures that Fort Dodge can contribute meaningfully to Mendell’s production capacity without requiring extensive infrastructure investment.
Building Relationships: The Scout Energy Partnership
M3 Helium has strengthened its operational position through an exclusive farm-in and fixed-price helium agreement with Scout Energy Partners. This partnership provides access to Scout’s gathering network and the Jayhawk gas processing plant, streamlining logistics and reducing operational risks. The agreement also secures a pathway for expanding production in the Hugoton field, ensuring a steady supply of helium to meet growing demand.
Financial and Strategic Positioning
Mendell Helium’s commitment to this new direction is supported by a disciplined approach to financing. The company has extended loans to M3 Helium to facilitate well development, infrastructure connections, and production increases. These funds are strategically allocated to maximize return on investment, particularly in high-yield wells like Nilson and Peyton.
Post-acquisition, Mendell will benefit from diversified revenue streams, including helium sales and potential royalties. The issuance of new shares as part of the acquisition ensures that Mendell minimizes debt, preserving financial flexibility for future opportunities.
Risks and Uncertainties
While Mendell Helium presents a strong growth opportunity, it faces notable risks. The M3 Helium acquisition remains pending, with a January 2025 deadline dependent on regulatory approvals, audits, and an admission document. Delays or failure to complete the deal could hinder growth. Operationally, reliance on partnerships like Scout Energy Partners and mobile purification technology for Fort Dodge poses potential logistical and scalability challenges.
Financially, Mendell’s dependence on loan facilities to fund M3 Helium highlights the need for consistent revenue generation, while helium market price volatility and competition add uncertainty. External risks, including environmental regulations and technical challenges, further underline the complexities of the natural resources sector. While Mendell is well-positioned, investors must balance these risks against its growth potential.
The Road Ahead: Unlocking Value for Shareholders
Mendell Helium is actively working on an admission document to finalize the acquisition of M3 Helium. This process will not only formalize the company’s transformation but also unlock significant value for shareholders by consolidating its position in the helium market.
With production-ready wells, proximity to established infrastructure, and partnerships that reduce operational complexity, Mendell is well-positioned to capitalize on the increasing demand for helium. As the company transitions from exploration to production, it has the potential to become a key player in the helium market, offering sustainable growth and long-term value creation. One to keep an eye on in 2025, for sure.
Learn more about Mendell Helium here…
In this two-part series, we’ve highlighted 20 small-cap companies with the potential to make a significant impact in their industries and deliver promising returns in 2025. From resource exploration and renewable energy to groundbreaking healthcare and advanced materials, these businesses showcase innovation, resilience, and strategic vision.
While small-cap investing carries risks, the opportunities for growth and transformation are immense for those who conduct diligent research and invest wisely. As we step into the new year, we wish all investors a successful, informed, and safe investing journey in 2025. May the year ahead bring prosperity and rewarding opportunities to your portfolios!
Author: steve@biztechmedia.net.
Disclaimer:
The information presented in this series represents the opinions and research of the author and is provided for informational purposes only. It is not intended to be, nor should it be interpreted as, financial, investment, or legal advice. Investors are encouraged to perform their own due diligence and consult with qualified financial advisors before making any investment decisions. Investing in small-cap stocks involves significant risks, and past performance is not indicative of future results. The author and publisher are not liable for any financial losses or actions taken based on the content of this series.
