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In this interview from August with DME president Don Mosher, he mentions the first processing facility will be up and running around the start of November. There will be a 90 day optimization period, where initially they will run the plant at the minimum amount of 50 thousand cubic feet and slowly ramp up the volume until it can handle its maximum amount of 10.5 million cubic feet per day of raw gas.
In a prior interview, Don mentioned that if the company were receiving old prices, before the 200% increase this year, and they were selling balloon grade helium (99.99% pure), and if the plant was running at 30% capacity, they would be making a profit (after royalties, taxes, and expenses) of $90,000 per day.
How I like to calculate the potential of this plant is to take the total gas output of 10,500 mcf (thousand cubic feet), multiplying that by the current average helium concentration of about 3%, and then multiplying that by the latest quoted price the company expects to receive, which right now is $2,500/mcf. I’ll then factor in a profit margin of 90%, which Rob has stated earlier is achievable at these prices.
A few factors could change the above formula. The possibility of Well #3 from the Meteor Crater field, the recently drilled Gunnar Dome wildcat, and another offset from the McCauley field also coming online at the onset of production could drastically change the helium concentrations. Eight wells feeding into the plant would probably be closer to 60% capacity than 30% capacity. The price after the optimization period could possibly be much higher than the price quoted by the company previously. DME plans on selling the highest grade (99.9999%) at spot price, which will be carrying a high premium as the helium shortage draws on.
http://www.metalsnews.com/Metals+News/MetalsNews/Dr.+Allen+Alper,+PhD+Economic+Geology+and+Petrology,+Columbia+University,+NYC,+USA/FEATURED1413692/Interview+with+Don+Mosher+President+Desert+Mountain+Energy+Corp+(TSXV+DME+US+OTC+DMEHF+Frankfurt+QM01)+Buil.htm
DME has trace amounts of neon and other rare noble gases (xenon, argon) in their first well. With the price of neon up 800% after the invasion of Ukraine, the neon in DME’s possession will be a nice bonus to the balance sheet.
However, the parts needed to separate these noble gases won’t be available until probably next year. In the meantime, DME has engineered a simpler processing facility made from off the shelf components, which is being manufactured as we speak and should be ready soon.
After 90 days of optimization (during which time DME will be selling any helium they put through the plant to the US government), DME will be selling helium directly to end users, who supply their own trucks for picking up the gas from the plant.
Instead of signing off-take agreements, DME will be selling their helium at spot price, since there could be more upside to the 300% increase in the price of helium since the start of the year. Initially DME plans to sell their helium to welding companies, and companies that use it as a lifting gas.
Eventually DME plans to sell their helium at a greater purity to tech companies and other users of high grade helium, but that will most likely happen next year after their second and more robust processing facility comes online.
The city of Flagstaff put a restraining order on DME’s well #3, as the city was concerned that DME’s well would interfere with the city’s aquifer. An appellate court ruled that the restraining order be removed and DME now had access to the well.
There hasn’t been any news of well #3 being tested yet, but I would speculate this might have something to do with DME hinting that they found helium-3 in the well. Perhaps an NDA with the US government is preventing DME from discussing this well, as there hasn’t been anymore information about it since the news of the court ruling came out on March 25th. DME used to talk about helium-3 in news releases from last year, but this isn’t the case anymore.
Initially DME plans to bring online wells #2,4,5,6, and 7. They are currently drilling well #8, and we should have news about its completion as early as tomorrow. This will be their fifth wildcat well, and it’s phenomenal that they have been 4/4 when the industry success rate of drilling wildcats is 18%. Their success has mainly to do with CEO Robert Rohlfing, who has been looking at this property since 1999, and of the over 250 wells he’s drilled in his career, he’s only missed on two occasions.
One more offset well from the McCauley field (wells 4,5,6,7) is also planned for this year, so five to six wells producing should have their first plant close to full capacity, which is 10,000 mcf of raw gas per day. Multiply that by an average helium concentration of 3.5%, and a recently quoted price by DME’s president of $2,500/mcf for their helium, and you get an idea of what this company will be capable of before year end. Multiply that by 60 to 70 more wells just in the Holbrook Basin alone, and you should have a good idea of where the company is headed in the next few years.
Something else that’s becoming a major development for the company is their discovery of a pure hydrogen field, which they say is a first in North America if not the world.
DME says they are working with the Arizona government to help them bring more hydrogen wells online. To do so, they are looking to have the legislation changed that says you can only drill one well per square mile in Arizona. This law was made with drilling for hydrocarbons in mind, and so DME is hoping their low environmental impact wells could be exempt from this law, with the intention of bringing hydrogen online to power electric car charging stations.
More hydrogen wells would probably mean more helium along with the hydrogen, and DME’s outlook of 60-70 wells in the basin could possibly be multiplied. Not to mention the company plans on expanding to other states in the region like Utah, Colorado, and Kansas.
This 26 year old drop-out raised $400 million in six months. How’s Bobby doing?
https://www.wsj.com/articles/the-26-year-old-dropout-lapping-the-hedge-fund-field-11650114049?st=7l8yv7udeqhouo4&reflink=share_mobilewebshare
Sure, the big spike was mostly from the news of the Arizona Appellate Court ruling in favour of DME after the City of Flagstaff placed a restraining order on DME’s Well #3. The news broke on Friday, but the stock was running up earlier in the week most likely due to investors taking advantage of insider information.
Well #3 is a topic of speculation among DME investors, after the CEO hinted at the possibility of helium-3 being present in higher than normal amounts. Because helium-3 is a matter of national security (it’s used to detect radioactive isotopes at airports, and also has the possibility to be used in fusion energy), there most likely will not be a news release in regards to finding helium-3. The biggest hint we will probably see is if the US government buys all of the helium coming out of Well #3. I think some long term investors of DME could have added to their positions based on this speculation.
From a macro perspective, I think the helium sector is heating up, with more investors catching on to the current helium shortage and what this means to future helium prices. Most helium stocks have been seeing an increase in share price lately, and I think DME’s gains today has a lot to do with that. Something else that could be on investor’s radar is how the war in the Ukraine is affecting the supply of neon. Since DME has encountered neon in their first well, this could be a potential draw among particular investors learning about the neon shortage.
DME’s latest board member, former judge Weldon Stout has been buying shares on the open market, the most recent being today buying 1,100 shares for almost a dollar more per share than he paid the last time he bought shares on March 11th. Insider buying will sometimes have network effects from investors close to or familiar with the insiders. A nice run up in the share price occurred shortly after the appointment of Kelli Ward to the board of directors in April of last year.
$2.48 million AUM. What will go to zero first, this stock, or the ETF?
https://www.etf.com/LGBT#overview
Just a reminder that LFAP needs $40 million AUM in their LGBT ETF just to break even. They launched the ETF with around $4 million AUM, and they are currently sitting at $3.23 AUM.
https://www.etf.com/LGBT#overview
AUM: $4.17 million. I would say no, this is not gaining momentum.
https://www.etf.com/LGBT#overview
You like to talk about the volume of the ETF, but the AUM is still sitting at $4.2 million, and the daily average volume is only $31,000.
https://www.etf.com/LGBT#overview
And the AUM is up to a wopping $4.2 million, just over 10% of what LFAP needs to break even lol
So what does everyone think of the mere $4.03 million in assets under management that the LGBT ETF is holding so far? I’m sure the share price is reflecting the fact that the company won’t be making any money this year, or perhaps ever.
I’m aware of the optimism behind pension funds buying into the ETF, however Bobby has had more than two years to find significant investment in this fund and the best he could come up with is $4 million.
When I sold this stock back in March of 2020, I got a private message from Jackpot telling me how foolish I was to sell. I told him I was cutting my losses in a company with no potential and putting my money into stocks with real potential, like $DMEHF. I doubled my position in $DME after I sold LFAP and I’m up over 2,000% since, and this stock has only just begun. I just don’t understand why everyone is investing so much time and money into a limp LFAP when you could be doing so much better.
Now is a great time to buy in, since we should see the test results from the fourth well soon.
I don’t think it’s worth diversifying in the helium space too much since DME is such a standout.
Avanti, Royal Helium, Imperial Helium, First Helium, and especially Helium One should all do quite well if everything goes works out for them.
However, most of these companies don’t have a plan for vertical integration, at least not by this winter like DME. Most of these companies, including Avanti I believe, will be selling crude helium, whereas DME will be selling refined 99.9999% pure helium for approximately ten times the price of crude.
Location is very important in the helium industry. When it comes to transporting the helium in 90°F heat, you lose about 2% of your load every hour. DME’s customers will be picking up the helium themselves, with no loss for the company. It’s unclear if Avanti or any other helium company will be able to strike the same deal, especially if they’re not dealing with end users.
It’s more costly to drill in the winter, and since Arizona’s winter is so short it’s not much of a burden on the company. Whereas winter in Saskatchewan, Alberta and BC can start as early as October for frozen temperatures and run as long as March. Although Avanti has an advantage here with the chinook winds running through Alberta and Montana.
Helium One benefits from a warm climate, but operating out of Tanzania brings its own set of risks and challenges.
I think Helium One is the best of the rest, since their properties could prove to be the best in the world, and they’re the only helium company so far that has the potential to be bigger than Desert Mountain Energy. For this reason I allocated about 1% of my portfolio to HLOGF. Otherwise I think allocating any money into another helium company other than DMEHF will almost guarantee me fewer returns in the short term and in the long term.
Look at the difference in how these stocks trade after news releases. DME is the only one that continues to climb. Just for fun I bought 15 shares of Avanti on May 11th, and so far I’m down 9%. I bought 75 shares of Royal Helium on April 19th, and I’m also down 9% on that stock. The last time I bought DME was on July 5th and I’m up 23% on those shares alone. In two years Avanti has climbed 408%, but in the same time frame DME is up 2263%, and they will continue to outperform because DME has a superior program.
The highest percentage of helium concentration Avanti hopes to see in any their wells is half of that which DME has already found in their second well. Avanti is hoping for 2%, while DME will be looking for 8-10% helium concentrations. DME was an early mover in the helium space. They could have bought leases in Montana or Saskatchewan, but they chose the Holbrook Basin in Arizona, which is known as the Saudi Arabia of helium.
For these reasons and many others, I’m damn near all-in on Desert Mountain Energy.
DME just launched a YouTube channel:
I’m under the impression that most of the shareholders that I’ve talked to on Reddit, Twitter, Stockhouse, iHub, and StockTwits have yet to realize the true potential value of this stock.
An important detail that DME’s VP of Capital Markets Don Mosher mentioned in one of his latest interviews is that rocket companies and tech companies require high grade (99.9999%) pure helium.
Don mentioned the company’s intentions to sell to these specific types of clients. CEO Robert Rohlfing said that just one tech company could buy all of their helium, but the company plans to diversify and sell to a private (most likely rocket) company, a public (tech) company, and the US government.
If their clientele is made up entirely of high grade helium consumers, and the going price of high grade He is $3,000/mcf as quoted by Don Mosher, that means this company is easily worth 3x most people’s estimates that I’ve seen.
After realizing this, I sold the farm, backed up the truck, and I’ve been loading as many shares as I can. This stock now makes up 86% of my portfolio, and I’ll continue to add shares until probably their first earnings call, as I predict the company will remain undervalued until then.
Since the company will be bringing in revenue so soon, and since they have zero debt, DME has explicitly said they will be fully diluted before the end of the year, which will only strengthen the value of our shares.
Former DME CEO Irwin Olian said their all in cost of extraction for crude helium is $65/mcf, and since I’ve seen elsewhere that Helium One’s projected cost of refinement is $20/mcf, I would estimate DME’s cost to produce their high grade helium would be somewhere in the ball park of $100/mcf. Perhaps DME’s refinement cost will prove to be less since their solar plant will be providing the energy required to run the refinement facility.
Don Mosher says the company expects to bring in $50 million revenue per quarter with the first five wells. Even if it’s just the first two wells that come online, that’s $80 million a year revenue, and at a 90% profit margin, that’s over $70 million. At a 10x price to earnings ratio, that would put this stock at a market cap over three times it’s current value.
But this is a conservative estimate, and I’m sure their true revenue per well will prove to be much greater. Even if DME does not receive the $3,000/mcf price that I’m speculating they will receive in their first quarter of production, the price of helium is poised to rise.
New MRI machines have been developed that require about a tenth of the helium of existing machines, but the increase in demand for MRI machines in developed and especially developing nations means the demand for helium in healthcare will remain high.
Scientific instruments that require helium are being built to capture the escaped helium for reuse, but the growing demand for helium in the tech sector will outpace any innovations in helium capture that would reduce existing demand.
More rocket flights means more helium will be needed to purge the fuel tanks, and more satellites which require helium to prevent their instruments from overheating.
There is going to be a rather large void on the supply side of helium once the US Bureau of Land Management holds their last auction of their helium reserves in September. I expect the price to increase as a result, and DME will be one of the first to market of the existing helium companies to capitalize on this drop in supply.
Every other public helium company that I know of looks inferior to what DME has to offer. DME used to be called African Queen Mines, and they were an early mover in the African gold space. They had success finding gold deposits, and about ten years ago they shifted their focus towards helium once the company caught wind of the world’s hottest commodity. Finally in 2018 they rebranded as Desert Mountain Energy after acquiring properties in Arizona and Oklahoma.
Their Oklahoma project is a natural gas well, which yields about 1% helium concentrations, which is insignificant compared to what the company expects to pull out of the ground in Arizona.
Since DME is an early mover in the helium space, they had their choice of where they wanted to drill for helium. They most certainly could have chosen Saskatchewan, which is known for their rich uranium deposits (uranium produces helium as a result of radioactive decay). But the historical data that you can find on the government of Saskatchewan’s website does not show that the Canadian province is known for high concentrations of helium.
DME chose to mainly operate out of Arizona, in the Holbrook Basin, which is known as the Saudi Arabia of helium. The old adage says that the best place to build a gold mine is right next to a gold mine, which is exactly what DME is doing.
The Pinta Dome gas field, which is right next to where DME has its leases, consistently pulled out concentrations of helium between 8-10%, whereas in Saskatchewan by comparison someone once found an anomaly of 7%, but they usually find concentrations around 1%, which is typical of natural gas wells.
What gives DME’s jurisdiction its greatest advantage is it’s proximity to end users. Originally the company planned on purchasing a fleet of vehicles to deliver their helium, but they reached an agreement with their customers where they will come pick up the helium.
Not only does this save the company $7 million in vehicle costs, but more importantly they won’t suffer any loss during transport. Don Mosher says that driving from Arizona to Texas in the middle of summer would account for an 18% loss by the time the helium reached its destination.
There currently is not a way to properly store helium where it won’t escape. Current MRI machines need to be topped up once a year, and small helium tanks for balloons only have a one year shelf life. The best natural containment for helium is a salt rock formation, like in the Holbrook Basin.
The biggest thorn in the company’s side when it comes to jurisdiction is the speed in which these drilling permits are issued by the state of Arizona. After the company establishes itself in the community and has started to donate money to the Arizona school system, which they promised they will do, then hopefully these drill permits won’t take so long to squire.
It also probably won’t hurt that their newest member of the board is a former state senator and current Chair of the Arizona Republican Party.
Another issue the company faces is the future of their third well. A judge recently granted the city of Flagstaff an injunction after the filed a restraining order on DME after the city feared that fracking would interfere with the city’s aquifer.
However the company is confident that an appeal would go their way since a similar case in Washington state was recently ruled in favour of a company. Not to mention, DME is not doing any fracking, their well is 3 miles away from their aquifer, and they are not drilling to the depth of where the aquifer is located. This matter probably won’t be settled until next year.
Well #3 was said to contain He3, which is the only other stable form of helium next to the commonly known He4. He3 will be sold to the Department of Homeland Security, as they use it to detect radioactive isotopes in airports. I’m not sure what sort of a price He3 fetches, but given its rarity I’m sure it would be at least comparable to high grade He4.
Since all of DME’s other leases are on private land away from any town or city, they won’t have to worry about any further restraining orders, nor do they have to worry about federal legislation designed to curb drilling efforts.
I’m sure I’m neglecting to mention some of the downside risks to this stock , but as far as I can tell the risks are pretty minimal, and the upside potential is massive enough that I’m digging in the couches trying to find more money to add to my position.
Once DME announces who their customers will be, and once they uplist to the Nasdaq as they intend to do, we will start to see a lot more interest in this company. Until then I’m happy with this stock flying under the radar, as it gives a better opportunity for me to add to my position.
If this isn’t your favourite stock as well I would like to know why. I honestly can’t think of a better place to invest my money, as this company will be experiencing significant growth over the next four or five years, which will be nearly unparalleled.
It almost seems like it’s a scare tactic. TripTrap may be on to something about hedge funds manipulating the stock. Hedge funds own 5% of the company, and they would have the power to walk this share price down.
Here’s a link to a great summary of the company, for anyone looking to learn more: https://www.reddit.com/r/investing/comments/mfbyli/investing_in_helium_dmehf_dd/?utm_source=share&utm_medium=ios_app&utm_name=iossmf
I’m confused what was going on with that $18.00 after hours PPS. It showed up on my iPhone stock app as such, but in my thinkorswim account I never saw the price move after hours. And then today PROF opened at $18.65, as if that after hours trading didn’t actually occur.
From the latest PR:
“The Company is in the early stages of exploring additional potential treatment markets for Sonalleve® where the technology has been shown to have clinical application, such as non-invasive ablation of abdominal cancers and hyperthermia for cancer therapy.”
The more uses a device has, the more likely a hospital will want to purchase that device.
Sorry, I can’t provide a link. The TD WebBroker research page gives me this information. The only other recent recommendation listed came from Frank Takkinen of Lake Street. He maintained a buy rating for PROF on 1/24 with a price target of $32.00. There is one more recommendation listed from Raj Denhoy of Jeffries, who initiated a buy rating last September with a price target of $24.57.
As a matter of fact, Rahul Sarugaser from Raymond James reiterated his buy recommendation yesterday with a price target of $34.08 USD.
I’ll remain optimistic about the upcoming call. Maybe it won’t be bad news. Perhaps they will announce that Sonalleve has been approved to treat lymph nodes.
This shareholder meeting video is a must watch. The CEO explains how DME will be bringing in millions by Q4 of this year:
https://desertmountainenergy.com/video-desert-mountain-energy-corp-annual-meeting-january-21-2021/
Sorry I meant PRN was up 4%
As I’m writing this, PRN is up 30% and PROF is only up 7%
Closed at $25.29, or 6.66% \m/
Looks like they just woke up haha.
Big news release today:
https://desertmountainenergy.com/a-report-from-the-ceo-robert-rohlfing/
New interview with CEO Robert Rohlfing:
Strong close today lol.
Closed green on a sell-off day. Gotta love that.
I added again today. If the price keeps going down I’ll continue to add. I’m also excited about where the company will be in a few years.
In the last conference call they touched on the possibility of using their tech for other treatments. I consulted a friend of mine that’s a specialist about PROF’s technology, and he thinks it’s possible to apply something like the TULSA to other forms as cancer, such as
Laryngeal adenocacinoma (voicebox cancer), rectal cancer, colon cancer, or any gastrointestinal cancer. The ablation tech might also be used to treat genital warts and herpes as well.
Profound is still putting lots of money into R&D, and it will be exciting to see if they do end up finding other uses for their technology. I’m not banking on the idea, but I think it’s a possibility that’s not priced in.
This is in hindsight of course, but if I was to guess, the insiders wanted to take more shares for themselves, which is why it gapped up so hard on the Canadian venture exchange at open this morning.
I just bought my first $DMEHF shares today; all my existing shares so far have been in $DME.V. I’m still surprised the company has made it this far with very little noise about it on the internet. I just found a forum on Stockhouse discussing the company quite regularly, but other than that it’s just the few of us on iHub and a couple of us on Twitter. Certainly this company won’t remain a secret for long, but it still baffles me that $DMEHF is the best kept secret on the OTC.
Trading halted today at the request of $DMEHF pending the release of some news:
https://finance.yahoo.com/news/iiroc-trading-halt-dme-161700871.html
Perhaps this will be our last chance to get in at these low prices, save for another market crash.
$DME.V just closed at $1.00 today. Shouldn’t be long before $DMEHF does the same.
“The Company anticipates that the completion and testing work will be complete with results available in the next few weeks.”
https://desertmountainenergy.com/desert-mountain-energy-commences-completion-and-testing-of-its-first-two-helium-wells-in-arizona-and-applies-for-14440-acres-of-new-leases-in-the-holbrook-basin/
Thanks for everyone’s responses. To answer your question, yes, Recognia was right in signalling a bullish pattern the last time they recommended Profound, however they were a little early in calling the bottom of the March crash. Here’s the link:
https://site.recognia.com/tdcanada_news/serve.shtml?page=event&name=stocks_en&eid=CAvyGyAJWUTQBwgABAACAAAA_iJg&symbol=PRN&exchange=TORONTO&isin=CA74319B5027&trade_type=L&lang=en&delivery=email&run_date=2020-03-12&eml=fausthimself%40hotmail.com&gaid=NL2034312979
My pleasure. I’m not sure if Recognia has a large following or not. I signed up for their emails through my bank, and I have not seen them referenced anywhere else before. Every night of a trading day they send out an email with reports on about eight different companies. This is the second time they’ve done a report on Profound since I signed up earlier this year.
To answer mst401k’s question to us all from the end of June, Profound makes up about a third of my portfolio. I originally took a small position early last year with PRN.TO, and took a larger position after the March crash. I bought into PROF as well a few months ago, and bought a lot more in the $15 and range over the last few weeks. Would anyone else care to say how much of their portfolio is made up of Profound? I’m also curious to know.