Blue Star Helium Advances Galactica Project Plans

Blue Star Helium Limited (ASX:BNL, OTCQB:BSNLF) (Blue Star or the Company) is providing a status update on flow rates at the State 16 SWSE 3054 helium discovery at its Galactica helium project in Las Animas County, Colorado.

Trent Spry, Managing Director and CEO of Blue Star, commented: "We are pleased with the outcomes from the State 16 well, drilled on schedule and at a significantly reduced cost compared to previous wells. This contributes directly to our financial performance as we refine our drilling and commercial strategies.

"The analysis of the State 16 well aligns with our projections. The impressive flow rates support our efforts to optimize production as we drill more development wells and maximize helium extraction at our processing facility.

"The approval of the new Galactica Pegasus OGDP, following ECMC's thorough review, is crucial for identifying development well sites between the State 16 and Galactica facilities.

"Our operations team and engineers are advancing every aspect of the project, including the exciting initiative to purify and sell CO2 into a market facing significant supply chain challenges."

In its announcement dated June 4, 2024, regarding the Significant Helium Discovery at the State 16 Well, the Company indicated that the results were under analysis by independent engineering consultants. They are modeling the maximum stabilized rate and drawdown for incorporation into development planning and economic assessments.

The Company is pleased to report that the results from the State 16 well have been combined with test data from the JXSN#1, JXSN#2, JXSN#3, and JXSN#4 discovery wells drilled by Blue Star. These results have been compared to publicly available information from the nearby Red Rocks development.

Analysis reveals that in the Lyons formation at the State 16 well, the calculated permeability is 405 mD. With a wellhead pressure of 6 psia, the well could potentially produce 441 thousand standard cubic feet per day (Mscfd). The range of permeabilities calculated across the JXSN discovery wells and the State 16 well varies from 300 to 750 mD, suggesting initial flow rates at 6 psia wellhead pressure could range between 334 and 780 Mscfd.

In the development planning phase, various vacuum compression scenarios will be evaluated for each well, ranging from 11 psia (-1 psig) to 6 psia (-6 psig) wellhead pressure. This assessment aims to achieve stabilized flow rates between 250 thousand standard cubic feet per day (Mscfd) and 615 Mscfd, based on the observed range of permeabilities to date. For the State 16 well (405 mD), these rates would range from 250 Mscfd to 350 Mscfd. These rates are optimized to maximize the initial production rate plateau, a standard practice in gas development to enhance recovery and maintain reservoir pressure, while ensuring a steady feed rate to the processing plant. The well is currently prepared for connection to production facilities.

Based in Australia, Blue Star Helium Ltd specializes in helium exploration, with a primary focus on conducting operations and exploration activities in North America. Blue Star's strategic focus is on discovering and developing new sources of economically viable, high-grade helium in the region.