The hottest resource dries up quickly; This company sits on a large deposit | 2021-06-03 | Invest news

(Image via Desert Mountain Energy Corp.)

One of the hottest commodities for investors right now is helium. Demand has grown exponentially over the past few years while supply has steadily declined.

It is not only valued for filling balloons. Because this gas is seven times lighter than air and far less reactive than hydrogen, it can be used in MRI machines, fiber optic cables for internet and television, computer chips and hardware, vehicle airbags, and more … its uses are incredibly diverse, but the lightest element of the Universe is also the second rarest freely occurring gas in our atmosphere.

This means that now is the best time for companies engaged in the exploration and production of helium. Given the high demand and high prices, those producing this non-renewable gas are sitting on a resource that would increase in value over time.

One of the most important sources of helium is the Holbrook Basin in northeast Arizona. According to a recent report entitled “Feasibility of Developing New Helium Wells in the Holbrook Basin, Arizona,” released in May 2021 by Colorado School of Mines Geologist Jacob Smith, helium concentrations were 8-10% in older fields within the basin some of the highest recorded in the world.

(Figure 1. Regional map showing the location of the Holbrook Basin and areas where significant helium concentrations have been encountered in northeast Arizona. A) Tohache Wash Field, B) Dineh-bi-Keyah Field, C) Pinta Dome Field, D ) Navajo Springs Field, E) St. Johns Springerville Area (Rauzi & Fellows, 2003).)

There is much exploration potential in the Holbrook Basin, with gas samples from the Pinta Dome Coconino sandstone showing that the likely source of helium is radioactive decay in near-surface bedrocks of the crust.

One company that has access to much of the Holbrook Basin outside of the Pinta Dome region is Desert Mountain Energy Corp. (TSX-V: DME, OTCQX: DMEHF, Forum).

Desert Mountain Energy, headquartered in Vancouver, British Columbia, is an exploration resource company engaged in the exploration and development of helium properties in the southwestern United States. The company is currently advancing its flagship Tier 1 helium project in the Holbrook Basin, Arizona, an area with great potential for untapped helium resources, potentially high grade helium properties and productive rare natural gas properties.

The Pinta Dome was the focus of historic production as well as the fields of Navajo Springs and East Navajo Springs. Structural mapping and stratigraphic insights from previous drilling in the area will allow the best exploration locations and new drill holes to be more clearly identified.

Desert Mountain Energy completed two new holes in the Holbrook Basin in 2020 and significant helium deposits were found in both holes.

Gas analysis on a slate showed concentrations of 7.1321% helium, 77.0837% nitrogen, 4.0183% CO2, and 2.6512% methane and other by-gases. Analysis of another slate showed concentrations of 4.0904% helium, 90.2742% nitrogen, 0.0063% CO2and 3.5535% methane and other by-gases.

The company is working to have these two new wells produced at its helium separation facility in Navajo County, Arizona, in late 2021. When construction is complete, the processing facility will use a combination of pressure swing adsorption and membrane technology to refine the helium produced from the wells. The refining process is simplified by the small amount of natural gas associated with the helium.

DME Chairman and Chief Executive Officer Robert Rohlfing stated in Smith’s report that while the total cost of the helium separation plant is proprietary, the construction of the plant is expected to compare the company with more than $ 7.5 million (USD) will save on other processing options.

The Company followed suit in December 2020 with drilling its third well in Arizona, which is planned to be drilled to a total depth of approximately 620 meters. This hole is located approximately 112 km west of the first two holes and is expected to reveal several significant geological structures in the western portion of the basin.

Smith’s report also found that refining helium at the facility will reduce transportation costs and add value to the helium produced by providing a more concentrated product to the industry. The company plans further helium exploration in the Holbrook Basin if production is successful.

(Desert Mountain Energy Corp. Stock Chart – June 2020 to June 2021. Click to enlarge.)

Desert Mountain Energy has seen a significant jump in price since the two successful helium exploration wells last year. During that time, the share price has rebounded more than 1,000%, up 178% since the start of the year. This increase in value is a clear indication that the team leading this company is on the right track with its exploration work, delivering results with high inventory values ​​and high helium levels.

In late May 2021, DME announced that it had completed the compulsory conversion of 2 series of 2-year warrants worth $ 2 that are tied to the company’s October 2020 financing for $ 1.60:

• The exercised warrants of $ 2.00 totaled $ 8,103,062, realizing $ 16,206,124
• Currently outstanding shares 70,260,909
• Outstanding warrants 4,082,266
• Outstanding options 6,467,500
• Fully diluted stocks, warrants and options 80,810,675
• Total cash currently in the Treasury is $ 29,270,078.81

Desert Mountain Energy Corp. plans to build a vertically integrated helium producer and the company is currently drilling in well # 4. There will be much more news to report from this company. Stay tuned on Stockhouse for future editorials coming soon.

For more information on the company’s business, please visit desertmountainenergy.com.

FULL DISCLOSURE: This is a paid article from Stockhouse Publishing.