Noble Helium Faces Funding and Operational Hurdles as Drilling Deferred

Leadership Changes Signal New Direction

In a pivotal move for Noble Helium Limited, Dennis Donald was appointed Non-Executive Chairman in March 2025, marking a significant leadership transition. Donald, a seasoned oil and gas executive with a track record of scaling companies like Warrego Energy, brings a wealth of experience to the helm. His appointment follows the resignation of four directors and signals a renewed focus on operational discipline and financial stewardship.

Donald’s immediate priority has been to address the delays hampering the company’s core exploration activities, particularly the highly anticipated drilling at the North Rukwa Project in Tanzania’s Rukwa Basin. As a major shareholder, Donald has expressed frustration over the postponements but remains optimistic about the project’s potential.

Drilling Delays and Strategic Reassessment

The Western margin shallow drilling program, initially slated for early 2025, was deferred due to prolonged customs clearance issues for the drilling rig and the onset of Tanzania’s wet season. This postponement, while disappointing, was deemed prudent to avoid operational inefficiencies and safety risks associated with wet season drilling.

Despite the delay, Noble Helium’s confidence in the North Rukwa Project remains robust. The project hosts up to 36 exceptional leads, including the flagship Mbelele prospect, supported by comprehensive geophysical and geochemical studies. These studies have reinforced the company’s belief in the commercial viability of helium extraction, positioning North Rukwa as potentially the world’s third-largest helium reserve behind the US and Qatar.

Financial Pressures and Cash Conservation

Financially, Noble Helium reported a cash balance of just $0.6 million at quarter-end, underscoring the urgency of its cost-saving initiatives. The company’s quarterly cash flow report reveals $0.4 million spent on administration and corporate costs, with exploration expenditure also curtailed due to the drilling deferral.

To bridge its funding gap, Noble Helium has secured a convertible note facility with Obsidian Global GP LLC, raising an initial tranche of US$850,000 with potential for further tranches totaling US$2.5 million. However, the company is also embroiled in a dispute with the Tanzanian Revenue Authority over VAT refunds related to exploration activities, a critical cash flow component. Noble Helium has engaged PricewaterhouseCoopers Tanzania to pursue an appeal, confident in its entitlement to these refunds.

Strategic Outlook and Investor Engagement

The new board is conducting a thorough review of the company’s medium-term strategy, balancing operational ambitions with financial realities. Engagements with potential farm-in partners, investors, and business collaborators are underway, aiming to secure the capital and expertise necessary to advance drilling and development.

Notably, the board has committed to forgoing remuneration until the company stabilizes and progresses, reflecting a disciplined approach to governance and shareholder value preservation.

Outlook for Drilling and Development

While the exact timing, location, and scale of the next drilling campaign remain under consideration, the company anticipates resuming drilling within the calendar year, post-wet season. The demobilisation of the Marriott drilling rig is progressing, with sensitive commercial discussions ongoing.

Success in the upcoming drilling campaign could be transformative, unlocking significant helium resources in a market where helium supply constraints are increasingly acute. Noble Helium’s technical team, supported by independent experts from Netherland, Sewell & Associates, continues to refine exploration targets, leveraging unique geological insights such as hydrogen gas tracers to pinpoint helium-rich zones.