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Coverage Launched on New Helium Co. With 3x Upside
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Aiming to advance its primary project to production as soon as possible, the firm intends to drill test it in Q4/23, noted an Auctus Advisors report.

Pulsar Helium Inc. (PLSR:TSX.V) gained research coverage by Auctus Advisors on the same day it completed its initial public offering (IPO), reported analyst Stephane Foucaud in an Aug. 15 initiation note. Auctus assigned Pulsar a CA$0.90 per share target price, which implies more than three times the upside.

"Pulsar is now about to start drilling," Foucaud wrote, "and is targeting early production."

200% Potential Return

This helium exploration and production company headquartered in British Columbia has two assets and a market cap of US$22 million (US$22M). Its price at IPO was CA$0.30 per share, one-third of Auctus' CA$0.90 target price on it.

Thus, the projected potential return for investors is significant, at 200%.

Asset Offers Near-Term Production

Pulsar's flagship asset is a natural gas project in Minnesota called Topaz, reported Foucaud, which in 2011 showed a helium concentration among the highest of North American projects owned by publicly listed peers: about 10.5%.

"Based on very limited data, the reserves auditor has already attributed up to about 300,000,000 cubic feet (300 MMcf) of helium contingent resource to this single well," Foucaud reported. "There could be much more."

Pulsar has the mineral rights and leases for up to 3,132 acres of land surrounding the discovery.

Topaz is in a less competitive area for helium, in a mining district and near access to infrastructure and the U.S. helium market. These features mean the helium asset could be rapidly monetized.

Auctus estimated that payback from Topaz would take only four months, assuming initial gross gas production of 5 Mmcf per day (5 Mmcf/d), a cost of US$15M to build a 10 MMcf/d facility, and a helium sales price of US$450 per thousand cubic feet. (Helium generally is produced as a byproduct of gas.)

To move forward, in Q4/23, Pulsar plans to drill and flow test a new well that twins the previous discovery to better understand the reservoir and to better define the Topaz project and resources. It also plans a passive seismic campaign for a clearer understanding of the area's geology.

"The upcoming drilling and flow test of the new Topaz well is a potential rerating event" that could "boost our valuation for the company to more than CA$3.45 per share," from CA$3.31, Foucaud wrote.

Project in Overlooked Region

Pulsar has a second, earlier-stage project in East Greenland called Tunu and holds the country's first awarded helium-hydrogen exploration license. It covers 2,772 square kilometers, relayed Foucaud.

Management believes Tunu contains all of the necessary geologic conditions for a possible helium development. This is bolstered by a positive result of sampling a hot spring in South Greenland, which emits gases of a similar composition to those discharged from springs in Tunu. The sample showed helium was present in concentrations as high as 2.3%.

Because most of the country's hot springs are in Central East Greenland, Pulsar is considering a joint development of geothermal/hydrogen and helium, Foucaud noted. Next, the company plans to acquire additional gas geochemistry and geophysics data on Tunu.

About the Commodity

Given its unique properties, helium is critical to high-growth sectors such as technology, space, and scientific research, yet the world's inventories of the element are quickly dwindling, Foucaud pointed out.

The European Commission has deemed helium a critical raw material. Today, most helium comes from a few fields in Qatar, Algeria, and the U.S., though production in the States is rapidly decreasing. All of this bodes well for Pulsar.

"The steep expected increase in demand, combined with riskier new sources of supply (Qatar and Russia), is expected to see helium prices remain very high," added the analyst.

Cashed Up for Current Plan

Pulsar has the funds for its upcoming drill and testing program at Topaz, Foucaud noted. As of June 30, 2023, the company had CA$100,000 in working capital and CA$2.5M in IPO proceeds.

A Look at Management

Thomas Abraham-James, the chief executive officer, president, and director, and Neil Herbert, executive chair, co-founded Pulsar in 2022.

Abraham-James is not only a seasoned CEO but also a geologist and has more than 17 years of experience in the mineral resource industry. Herbert's expertise is finance, a sector in which he has worked for 30 years.

Pulsar's chief financial officer (CFO) is Dan O'Brien, who has been the CFO for a number of private and publicly listed mineral exploration companies.

Pulsar's directors and officers have skin in the game, noted Foucaud, as together they hold about 49% of the helium company's total 74.9 million issued shares.

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Important Disclosures:

  1. Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  2. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

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Disclosures for Auctus Advisors Inc., Pulsar Helium Inc., August 15, 2023

Pulsar Helium inc (“Pulsar” or the “Company”) is a corporate client of Auctus Advisors LLP (“Auctus”). Auctus receives, and has received in the past 12 months, compensation for providing corporate broking and/or investment banking services to the Company, including the publication and dissemination of marketing material from time to time.

MiFID II Disclosures This document, being paid for by a corporate issuer, is believed by Auctus to be an ‘acceptable minor non-monetary benefit’ as set out in Article 12 (3) of the Commission Delegated Act C(2016) 2031 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. It is produced solely in support of our corporate broking and corporate finance business. Auctus does not offer a secondary execution service in the UK. This note is a marketing communication and NOT independent research. As such, it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and this note is NOT subject to the prohibition on dealing ahead of the dissemination of investment research.

Author The research analyst who prepared this research report was Stephane Foucaud, a partner of Auctus.

Not an offer to buy or sell Under no circumstances is this note to be construed to be an offer to buy or sell or deal in any security and/or derivative instruments. It is not an initiation or an inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000.

Note prepared in good faith and in reliance on publicly available information Comments made in this note have been arrived at in good faith and are based, at least in part, on current public information that Auctus considers reliable, but which it does not represent to be accurate or complete, and it should not be relied on as such. The information, opinions, forecasts and estimates contained in this document are current as of the date of this document and are subject to change without prior notification. No representation or warranty either actual or implied is made as to the accuracy, precision, completeness or correctness of the statements, opinions and judgements contained in this document.

Auctus’ and related interests The persons who produced this note may be partners, employees and/or associates of Auctus. Auctus and/or its employees and/or partners and associates may or may not hold shares, warrants, options, other derivative instruments or other financial interests in the Company and reserve the right to acquire, hold or dispose of such positions in the future and without prior notification to the Company or any other person.

Information purposes only This document is intended to be for background information purposes only and should be treated as such. This note is furnished on the basis and understanding that Auctus is under no responsibility or liability whatsoever in respect thereof, whether to the Company or any other person.

Investment Risk Warning The value of any potential investment made in relation to companies mentioned in this document may rise or fall and sums realised may be less than those originally invested. Any reference to past performance should not be construed as being a guide to future performance. Investment in small companies, and especially upstream oil & gas companies, carries a high degree of risk and investment in the companies or commodities mentioned in this document may be affected by related currency variations. Changes in the pricing of related currencies and or commodities mentioned in this document may have an adverse effect on the value, price or income of the investment.

Distribution This document is directed at persons having professional experience in matters relating to investments to whom Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 ("FPO") applies, or high net worth organisations to whom Article 49 of the FPO applies. The investment or investment activity to which this communication relates is available only to such persons and other persons to whom this communication may lawfully be made (“relevant persons”) and will be engaged in only with such persons. This Document must not be acted upon or relied upon by persons who are not relevant persons. Without limiting the foregoing, this note may not be distributed to any persons (or groups of persons), to whom such distribution would contravene the UK Financial Services and Markets Act 2000 or would constitute a contravention of the corresponding statute or statutory instrument in any other jurisdiction.

Disclaimer This note has been forwarded to you solely for information purposes only and should not be considered as an offer or solicitation of an offer to sell, buy or subscribe to any securities or any derivative instrument or any other rights pertaining thereto (“financial instruments”). This note is intended for use by professional and business investors only. This note may not be reproduced without the prior written consent of Auctus. The information and opinions expressed in this note have been compiled from sources believed to be reliable but, neither Auctus, nor any of its partners, officers, or employees accept liability from any loss arising from the use hereof or makes any representations as to its accuracy and completeness. Any opinions, forecasts or estimates herein constitute a judgement as at the date of this note. There can be no assurance that future results or events will be consistent with any such opinions, forecasts or estimates. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied is made regarding future performance. This information is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company and its subsidiaries. Auctus is not agreeing to nor is it required to update the opinions, forecasts or estimates contained herein. The value of any securities or financial instruments mentioned in this note can fall as well as rise. Foreign currency denominated securities and financial instruments are subject to fluctuations in exchange rates that may have a positive or adverse effect on the value, price or income of such securities or financial instruments. Certain transactions, including those involving futures, options and other derivative instruments, can give rise to substantial risk and are not suitable for all investors. This note does not have regard to the specific instrument objectives, financial situation and the particular needs of any specific person who may receive this note. Auctus (or its partners, officers or employees) may, to the extent permitted by law, own or have a position in the securities or financial instruments (including derivative instruments or any other rights pertaining thereto) of the Company or any related or other company referred to herein, and may add to or dispose of any such position or may make a market or act as principle in any transaction in such securities or financial instruments. Partners of Auctus may also be directors of the Company or any other of the companies mentioned in this note. Auctus may, from time to time, provide or solicit investment banking or other financial services to, for or from the Company or any other company referred to herein. Auctus (or its partners, officers or employees) may, to the extent permitted by law, act upon or use the information or opinions presented herein, or research or analysis on which they are based prior to the material being published.

Further Disclosures for the United Kingdom This note has been issued by Auctus Advisors LLP, which is authorised and regulated by the Financial Conduct Authority. This note is not for distribution to private customers. This note is not intended for use by, or distribution to, US corporations that do not meet the definition of a major US institutional investor in the United States or for use by any citizen or resident of the United States. This publication is confidential and may not be reproduced in whole or in part or disclosed to another party, without the prior written consent of Auctus. Securities referred to in this note may not be eligible for sale in those jurisdictions where Auctus is not authorised or permitted by local law to do so. In particular, Auctus does not permit the distribution or redistribution of this note to non-professional investors or other persons to whom disclosure would contravene local securities laws. Auctus expressly disclaims and will not be held responsible in any way, for third parties who affect such redistribution. © Auctus Advisors LLP All rights reserved 2023

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