July 15, 2024

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Cash is Trash, IPO’s are HOT, Helium will RISE again

Cash is Trash, IPO's are HOT, He will RISE again

Simon Catt

Guest columnist

If you’re sitting on any spare cash for gods sake BUY SOMETHING RISKY. Meme stock chat forum Reddit closed up by almost half on its market debut this week a day after AI proxy Astera Labs surged 72% from its IPO price raising $713 million on Nasdaq.

With Easter a week away you may hear a pious friend say “He has risen” to which you could rejoin; “Amen brother and did you get a Helix Exploration [Helium] IPO allocation?” More on this below.

The Fed says it’s ok if inflation is “bumpy” which is code for not going back to its pretend “2% supercore” blah blah target. Does anyone actually believe prices are only increasing at 2, 3 or even 5% a year? I mean for starters you may have noticed your mortgage cost has more than doubled in three years and housing makes up ~ 30% of the CPI inflation calculation.

The labour unions in your city interrupting your train journey or holiday flights seem to understand that they need +10% annual wage growth to keep up with the cost of living.

All Federal Reserve Governors now agree 75 basis points of interest rate cuts are coming. It’s US election year after all and both Trump and Biden want the US voter to be happy. Maybe Jerome Powell wants to keep his job.

Flooded neighbourhood with the text: The FED is prepared to offer additional liquidity if needed.

Rather than taking the punch bowl away the Fed is pouring in MORE JUICE.

The Fed’s problem is that the highly indebted 10% of US population (voters) earning less than $25,000 a year and highly levered companies ARE experiencing a HARD LANDING:

So the Fed, members of which are appointed by politicians in an election year has to choose between blowing bubbles and helping out the poorest 10% of the United States. Let’s Party like it’s 1999:

Commodity prices have caught a bid…

Apart from Nvidia, Bitcoin and Argentine Bonds how about a little DIVINE INSPIRATION for Easter?

Helix Exploration https://www.helixexploration.com/home is the hottest IPO we have seen in three years. The company was looking for £3-5 million and came back with £23 million of demand of which it took £8 million heavenly money.

At its 10 pence IPO price Helix will have a value of ~ £13 million which is about one sixth of fellow US helium explorer Pulsar Helium (PLSR on the TSX) up 400% since its August 2023 IPO.

Helix’ is scheduled for DIVINE LIFT OFF on London’s AIM market April 9th:

AHEM, can you remind me why Helium is HOT!?

HELIUM; the inert noble gas and second lightest element after Hydrogen is up ~ 10X in ten years and Exxon will charge you ~ $600/Mcf on long term contract about 200 times for valuable than natural gas.

Helium is rare, inert (can’t be burned) and has the lowest boiling temperature of any element on our planet. Demand is driven by semiconductor manufacture – helium is used to sterilise and cool the manufacture of computer chips and to cool the jets of rockets as they take off.

Helix Exploration is exploring for helium in the US state of Montana which is a much better place to find the rare gas than say Tanzania because the United States is the worlds largest consumer of helium and has the oil and gas infrastructure to capture, process, store and transport He to its end demand at NASA or an Intel fab.

Helix Exploration is run by ‘Mr Helium’ Bo Sears who wrote “Helium: The Disappearing element”.

Bo, whose father is a Texas oilman, spent ten years acquiring the land that hosts Helix’ “Ingomar Dome” a +2 Billion Cubic Feet (Bcf) structure that flowed nitrogen and methane amongst other gases when first drilled in 1940 by oil and gas explorer Northern Ordinance.

Amsden Test document, showing gas analysis and Initial Production. Helium Not Analyzed is in red.

In 1940 helium was not valuable nor tested for but as you see from the log above there was 8,200 Million Cubic Feet (Mcf) per day of other gases like Nitrogen and methane. Curiously it didn’t burn when tested.

Helix use of proceeds from its IPO is to follow up the surface geochem samples at the Ingomar Dome that have anomalous helium and confirm there is perhaps 1.5% helium content in the now capped well. If they find the 2Bcf helium they are looking for they could be in production as soon as the end of 2025.

Prospective acolytes and punters looking skyward should note that this is NOT wildcat exploration. Helix is in the “Flathead Fairway” where there are other helium discoveries and some producers like North American Helium and Royal Helium, mainly in neighbouring Saskatchewan Province in Canada.

We will interview Mr Helium;  aka ‘Bo’ after Easter just in time for the Helix IPO around April 9th.

Cash is trash. He and other speculative endeavours will rise.

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Simon Catt

Simon is a director of Arlington Group Asset Management Limited. He has over two decades of investment banking experience across equity sales and corporate finance in London having joined Arlington from GMP Securities Europe, which he founded in 2007.

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