Mendell Helium (AIM: MDH) has reported highly encouraging preliminary results from its Fort Dodge operations in Kansas, with gas samples from the Rost 2-26 well returning helium concentrations of up to 10.9%.
The company said two preliminary gas analyses from Rost 2 recorded helium concentrations of 10.7% and 10.9%, more than twice the levels previously observed at the nearby Rost 1 well.
The results follow the installation of an electrical submersible pump at Rost 2, where dewatering has increased to approximately 1,100 barrels of water per day.
As water levels have fallen, gas-bearing “foamy water” has begun appearing at the surface, replicating the early response previously seen at Rost 1 as hydrostatic pressure was reduced.
Mendell cautioned that gas volumes from Rost 2 remain low while de-watering continues and that the gas composition could change as flow rates increase.
Nevertheless, the company described the initial helium concentrations as exceptional and said it was unaware of producing wells elsewhere in Kansas recording comparable levels.
Management will now monitor gas-to-water ratios, intake pressure, production rates and gas composition as de-watering continues.
Processing facilities at the Rost site have also been upgraded ahead of production and are expected to be capable of handling combined volumes from Rost 1 and Rost 2. Mendell is continuing work to improve helium purification capabilities at the site.
The company also highlighted additional potential within the deeper Mississippian formation.
Previous mud-gas analysis during drilling showed helium peaking in the target Morrow formation but remaining elevated within parts of the Mississippian. Rost 2 was subsequently perforated across both formations.
Mendell stressed that it is too early to determine the gas composition of the Mississippian independently or conclude that it contains higher helium concentrations than the Morrow.
Elsewhere at Fort Dodge, the Schneweis Ventures 13A well has commenced production and is delivering gas directly into a pipeline owned by joint venture partner Ritchie Exploration without requiring a pump.
Schneweis has a four-foot perforated interval and previously recorded a historic flow rate of 300 Mcf per day with a helium concentration of 1.3%.
Strong downhole pressure meant a pump could not initially be installed, so the partners instead began selling the naturally flowing gas directly into the pipeline.
Peak daily sales have so far reached 428 Mcf, with the lowest daily rate at 150 Mcf. Mendell expects to receive revenue from the helium, methane and natural gas liquids contained within the untreated gas.
Rost 1 has meanwhile returned to production following maintenance and replacement of its downhole tubing.
The company identified wear associated with persistent mineral scaling and has introduced an ongoing chemical treatment programme designed to reduce future scale build-up. The same approach will also be used at Rost 2.
Following the work, both water extraction and gas production at Rost 1 have resumed at elevated rates, with field crews now measuring stabilised flow and production volumes.
Chief executive Nick Tulloch said the helium concentrations above 10% at Rost 2 represented a significant milestone, although he stressed that further de-watering and production data would be required before conclusions could be drawn about sustainable production.
He added that the early Rost 2 results and natural pressure response at Schneweis provided further evidence that Mendell’s de-watering strategy could potentially be repeated across multiple Fort Dodge wells.
The company intends to continue expanding its land position and drilling additional wells as it develops the Fort Dodge helium project.
