July 27, 2023 Via Gasworld
Avanti Helium has signed a binding midstream agreement with IACX Resources Montana, a subsidiary of IAXC Energy, to build, finance, and operate a helium recovery plant to process raw gas from Avanti’s Sweetgrass helium pool.
The helium exploration, development, and production company today (27th July) said it hopes that initial components for the plant will be delivered to the site in Q4 2023, with initial production expected in Q1 2024.
Once operational, the plant is expected to initially process 10 million cubic feet of raw gas a day, with an option to increase production to 15 million cubic feet a day.
Chris Bakker, CEO of Avanti Helium, said that having IACX construct and operate the plant de-risks execution for Avanti.
He added, “We are also pleased to have arrived at fee terms that drastically reduce our need for capital. I would like to thank the entire Avanti team for the huge amount of work done to bring the Company to this tremendously positive turning point.”
Developing the helium recovery plant independently posed a major capex and expertise requirement for Avanti, but through the IACX transaction, and the liquification tolling agreement, the company will have access to the required infrastructure to achieve cashflow in an attractive commercial environment.
Under the terms of the agreement, Avanti will pay a scheduled monthly fee for seven years, with an option to renew annually for the life of the pools.
IACX will build, finance, install, and operate the helium recovery plant on site near the Sweetgrass helium pool. Avanti Helium will be required to complete minor associated infrastructure work to commence production of the plant.
Just last month (June 2023), IACX signed a similar agreement with Blue Star Helium, to supply and operate the company’s recovery plants at its maiden helium development, Voyager.