Whitebark shares soar 50 per cent on SA energy play

Whitebark Energy shares soared as much as 50 per cent on Friday after the company made an off market bid to acquire private entity King Energy, which holds Australia’s biggest prospective onshore seismically defined sub-salt, white hydrogen, helium and gas projects in South Australia’s Officer Basin.

Under the bid agreement, Whitebark will issue 100 million new shares at a price of 12 cents and a further 100m options, exercisable at 5c, for an implied purchase price of about $1.7 million.

Investors already seem intrigued with the potential for companies chasing the first two elements of the periodic table and shares in Whitebark hit a high of 12 cents in intraday trading on Friday, up 50 per cent from 8c at the start of trade.

Hydrogen comes in a rainbow of colours, derived from a myriad of magical methods. Green hydrogen is made by cracking water into oxygen and hydrogen. Blue hydrogen is made from natural gas with the carbon emissions captured and stored. Grey hydrogen comes from natural gas with carbon dioxide emissions released into the atmosphere.

It also comes in black and brown, pink, purple, red, turquoise and yellow – and a lesser-known white.

Whie hydrogen is a naturally occurring gas found in underground deposits, alongside helium and is being touted as a clean energy source crucial in the global quest for net zero carbon emissions.

Helium has a wide range of uses, from leak detection and cryogenic cooling to creating inert atmospheres. It is also used as breathing mixture with oxygen, welding and as a safe lift gas for blimps and balloons – even party balloons.

The demand for helium has surged in recent years owing to the importance of the gas in the medical and healthcare sector, aerospace industry and in the manufacturing of semiconductors and fibre optics.

The global helium market was about 6 million tonnes in 2022 and is projected to reach nearly 11.8mt by 2032.

The acquisition of King Energy is a very positive outcome for the company, offering access to some of Australia’s largest seismically defined onshore structures. The exploration opportunities provide Whitebark with exposure to the fast-growing white hydrogen industry, in conjunction with high demand and high-priced helium, and hydrocarbons to fuel Australia’s energy transition requirements.

King Energy lays claim to a 70 per cent interest in Officer Energy which indirectly owns 100 per cent of two petroleum exploration licences covering a whopping 19,467 square kilometres of the Officer Basin in South Australia.

King Energy director Richard King describes the Officer Basin as an underexplored “frontier” with massive untapped potential to hold significant resources. The company also controls the operations of the Alinya project.

The Alinya project is made up of more than 20 identified prospects with the standout Rickerscote, Milford and Milford West targets tallying up more than 400 square kilometres of closure or productive areas, spearheading the trio to the biggest, undrilled, seismically defined, sub-salt structures in onshore Australia.

Current interpretations of existing well intersections demonstrate that all the crucial elements necessary for the discovery of white hydrogen and helium, together with hydrocarbons, are proven to be present. These include stacked reservoir-seal pairs, salt seals and multiple source rock intervals capable of generating hydrogen, helium and hydrocarbons.

Whitebark’s management says the massive production area of the currently identified prospects and the occurrence of hydrogen and helium in an encountered gas column, discovery volumes could be globally significant for white hydrogen, helium and hydrocarbons to potentially transform the conventional energy needs of Australia.

Whitebark is wasting no time with field operations slated to commence in the first quarter of next year. The company is planning a soil geochemistry survey using the most recently developed monitoring technology to assess ground soil presence of hydrogen and helium, followed by 250km of modern 2D seismic infill across the Rickerscote and Milford prospects aimed at pinpointing drilling locations.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au