A heavily discounted fundraise to bankroll Colorado drilling and Tanzanian licence fees sent shares to near multi-year lows.
Helium One Global (AIM: HE1) saw its shares slump 22% to 0.3p on Wednesday after the company raised £3m through a placing priced well below the prevailing market level, piling further pressure on long-suffering shareholders.
The fundraise saw more than 1 billion new shares issued at 0.29p apiece, a steep discount to Tuesday's closing price and close to multi-year lows for the stock, which had traded above 0.5p as recently as early October.
Proceeds will fund further drilling at the 50%-owned Galactica-Pegasus helium project in Colorado, where production began in July, as well as cover the annual mining licence fee for the Rukwa project in Tanzania. Partner and operator Blue Star Helium is ramping up the Pinon Canyon processing plant towards continuous operation, targeting full capacity by the end of 2027 using as many as 15 wells.
Helium One said it plans to drill three additional wells at the Colorado site this quarter using money from the placing, with subsequent drilling to be funded from production revenues. The operator is also eyeing a new income stream from carbon dioxide produced alongside the helium, expected to begin generating revenue from early 2027.
In Tanzania, the group is still hunting for a partner to help advance Rukwa, with several interested parties said to be reviewing project data as Helium One looks to capitalise on tight global helium supply. The scale of Wednesday's discount underlines how difficult funding conditions remain for the explorer despite progress on the ground in Colorado.
This report is based on Helium One Global’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full results calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Patrick Hendry on Unsplash.
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