Should I buy Helium One shares as drilling starts?

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Roland Head | Wednesday, 16th June, 2021 | More on: HE1 It was released in November 2020, and make no mistake:It’s happening.The UK Government’s 10-point plan for a new “Green Industrial Revolution.”PriceWaterhouse Coopers believes this trend will cost £400billion……That’s just here in Britain over the next 10 years.Worldwide, the Green Industrial Revolution could be worth TRILLIONS.It’s why I’m urging all investors to read this special presentation carefully, and learn how you can uncover the 5 companies that we believe are poised to profit from this gargantuan trend ahead! I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Simply click below to discover how you can take advantage of this. Image source: Getty Images Access this special “Green Industrial Revolution” presentation now Our 6 ‘Best Buys Now’ Sharescenter_img The Helium One Global (LSE: HE1) share price has risen by almost 400% since the helium explorer floated on the London market in December. Drilling is now underway at the company’s flagship Rukwa project in Tanzania.Helium gas is essential in medical equipment and electronics manufacturing, and global supplies are limited. I reckon good drilling results could trigger share price gains for Helium One. With the HE1 share price now taking a breather, should I buy the stock ahead of the next big move?5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…A “must drill” opportunityAt 4pm local time on Saturday 12 June, Helium One started drilling the first exploration well at its 100%-owned Rukwa Project in Tanzania. External consultants SRK Consulting have reported a best estimate unrisked prospective helium resource of 138 billion cubic feet at Rukwa. This is — potentially — a world-class resource.The first well is being drilled at Tai, which management describe as “a ‘must drill’ three-way dip closure, upgraded by the Company’s recent 2D infill seismic”.Three wells are planned for this drilling programme, each of which will test a different type of trap. In other words, they will each target different underground rock formations to see which — if any — have helium deposits trapped within them.HE1 expects each well to take about month to complete. So we could see results from the company from the middle of July. I think that a positive early result could push the Helium One share price higher.How risky is this?New drilling campaigns are a hugely exciting time for an explorer. It has taken five years of surveying and analysis for Helium One to get to this stage.Surface seeps containing more than 10% helium have given the company confidence that there’s helium in the ground. However, there’s no guarantee that this will convert into a commercial find.The reality is that only a small minority of exploration companies make it big. This is why the pay-offs for winners are so huge — most explorers don’t strike it lucky.It’s incredibly hard to value a stock like this without any information about its commercial potential. But it’s worth remembering that even if HE1 is successful, the company will probably need a lot more money to develop Rukwa. April’s £10m fundraise isn’t likely to last long, in my view.Helium One share price: high enough already?Helium One shares have four-bagged since December. This has given the group a market cap of £129m, even though it has no revenue, limited funding, and no proven resources.I think this is an interesting situation with real potential. But I think that the Helium One share price may already be pricing in a successful drilling campaign.Markets tend to look forward and value shares on what’s known. Right now, the information we have about HE1 and Rukwa is pretty positive. But if early drilling results are mixed and investors turn cautious, the stock could fall quite sharply.Without specialist knowledge about HE1’s assets and about the helium market, I don’t feel confident buying this stock after such a strong run. I think the share price is probably high enough today. I’ll be staying on the sidelines for now. Enter Your Email Address Our 5 Top Shares for the New “Green Industrial Revolution” Should I buy Helium One shares as drilling starts? Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. See all posts by Roland Headlast_img read more