TSX.V: DME
U.S. OTC: DMEHF
Frankfurt: QM01
VANCOUVER, BC, Oct. 26,
2023 /CNW/ - DESERT MOUNTAIN ENERGY CORP. (the
"Company") (TSXV: DME) (U.S. OTC: DMEHF) (Frankfurt: QM01)
From the President of the Company. The Company is
pleased to confirm the delivery of all necessary components for the
West Pecos helium processing
plant. Heavy rains washed out portions of roads not maintained by
the Company which delayed delivery of the larger multi-stage
compressor. Operational start-up is anticipated to take place in
the first half of November. Critical components, excluding the
final compressor and dehydration unit connections, have been
pressure tested successfully.
The company, as previously communicated, has been focused on
pigging flow lines, eliminating specific choke points, and
conducting flow line maintenance. Work on the gas lines and on 12
specific wells has resulted in significant increases in gas flow.
Management feels that of 188 total wells in the field, between
85-104 would be targets for additional workovers to increase
production for both natural gas and helium. Actual results and time
will dictate the final number of wells which could benefit from
enhancement procedures.
The Company assumed control of operations on July 1, 2023, at which point natural gas
production had declined to roughly 104MCFGPD. During the course of
the flow line work carried out in the latter part of July, and
throughout August and September 2023,
gas sales were intermittently halted for a total of 10 days. Since
the completion of that initial work, production levels have
increased. In July 2023 DME averaged
production of 275MCFGPD, with August and September 2023 averaging 822MCFGPD. DME
systemically focuses on improving wells, plant line feed
compressors and general maintenance to increase those numbers to
meet our near-term goal of 1,500+MCFGPD. Anticipated increases in
gas production for the long term will be achieved through more
complex well workovers, which will be paid for using cash flow from
field operations.
The acquisition of smaller-volume compressors was aimed at
enhancing production from helium-rich wells. As mentioned in our
earlier press releases on 06/19/23, 07/06/23, and 08/16/23, our geological team swiftly pinpointed
and continues to evaluate wells suited for optimal helium
production. Independent gas analysis conducted on chosen wells
during and after workovers continues to ensure proper correlation
between the gas analysis tests, originally provided to us by the
seller. The Company is aware that initial helium and natural gas
values will alter once production starts in our plant. As
previously reported in press releases, helium was considered as an
inert gas and as such, no value was ascribed to, or payment made to
any former company as a produced marketable product. This implies
that any helium values will need to be initially classified under
PUD reserves. Management feels that continued geological study of
well files will further pinpoint highly prospective zones for
increased helium production. DME's position is that those reviews
showing previously discovered zones and testing positive for helium
will confirm a number of yet-to-be-determined additional drill
locations as identified by previous operators. During the Company's
initial review prior to purchase, some research indicated higher
helium values on one or two of the wells which have since been
found inaccurate. Consequently, this data has accordingly been
included in our planned well workovers to maximize helium
production.
Recent sampling and historical data suggest an initial average
of 0.50% helium grades with the commencement of helium production
in the plant. Senior Management is continually approached by
additional helium end-user purchasers offering to buy all helium
grades. To increase shareholder value, the Company is exploring
potential end-user contracts, enabling higher prices for its
natural gas production as appropriate. The presence of more natural
gas carriers crossing our leases strengthens this position. For
instance, El Paso gas, with a pipeline across our leases and two
existing line taps, one of which is at our initial processing
facility locations, exemplifies this. Large, high-pressure gas
lines typically require over a year of advanced planning to secure
all necessary approvals for a tap addition. The planning and
installation of a physical line tap can surpass one million USD. Currently, DME has two
well-maintained line taps on our properties.
"Unforeseen obstacles led to the necessary relocation of our
processing facility to our new gas asset in New Mexico," says CEO Robert Rohlfing. "However, the company is poised
to commence operations and looks forward to realizing a positive
cash flow from our consolidated revenue-generating assets."
Desert Mountain Energy Corp. is committed to not only adhering
to the state and federal regulations concerning emissions and
quarterly testing from field equipment but also going a step
further. The company is entering into an agreement with a private
company to remove the majority of the CO2 from field emissions and
convert it cost-effectively to food-grade CO2. The operation will
begin with smaller engines operating booster compressors before
progressing to larger plant-sized compression and power generation.
DME looks forward to collaborating with the New Mexico-based company and further building
on its previous work with National Laboratories.
In addition, the company continues to work with our external
hydrology firm in Arizona to
investigate all possible strategies related to its long-term
operational plan in that state. DME made a joint decision and
agreed to extend their timeframes and contracts with Beam Earth in
regard to our hydrogen projects in Arizona. The Company continues to renew its
existing oil, gas, helium and mineral leases in Arizona.
Robert Rohlfing, CEO of DME, will
be a highlighted speaker at the 2023 Helium Super Summit, scheduled
to occur in Houston, TX from
October 1 to November 1, 2023.
ABOUT DESERT MOUNTAIN
ENERGY
Desert Mountain Energy Corp. is a publicly traded resource
company primarily focused on exploration, development and
production of helium, hydrogen and noble gases. The Company is
primarily looking for elements deemed critical to the renewable
energy and high technology industries.
We seek safe harbor
"Robert Rohlfing"
Robert
Rohlfing
Exec Chairman & CEO
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in polices of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release. The statements made in this press release may contain
certain forward-looking statements that involve a number of risks
and uncertainties. Actual events or results may differ from the
Company's expectations.
Cautionary Note Regarding
Forward-Looking Statements
This news release contains "forward-looking statements"
within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and "forward-looking information"
within the meaning of applicable Canadian securities legislation.
Such forward looking statements and information herein include but
are not limited to statements regarding the Company's anticipated
performance in the future the planned exploration activities,
receipt of positive results from drilling, the completion of
further drilling and exploration work, and the timing and results
of various activities.
Forward-looking statements or information involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements of
the Company and its operations to be materially different from
those expressed or implied by such statements. Such factors
include, among others, changes in national and local governments,
legislation, taxation, controls, regulations and political or
economic developments in Canada
and the United States; financial
risks due to helium prices, operating or technical difficulties in
exploration and development activities; risks and hazards and the
speculative nature of resource exploration and related development;
risks in obtaining necessary licenses and permits, and challenges
to the Company's title to properties.
Forward-looking statements are based on assumptions
management believes to be reasonable, including but not limited to
the continued operation of the Company's exploration operations, no
material adverse change in the market price of commodities, and
such other assumptions and factors as set out herein. Although the
Company has attempted to identify important factors that could
cause actual results to differ materially from those contained in
forward-looking statements or information, there may be other
factors that cause results to be materially different from those
anticipated, described, estimated, assessed or intended. There can
be no assurance that any forward-looking statements or information
will prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements or
information. Accordingly, readers should not place undue reliance
on forward-looking statements or information. The Company does not
intend to, and nor does not assume any obligation to update such
forward-looking statements or information, other than as required
by applicable law.
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SOURCE Desert Mountain Energy Corp.