Research Reports

Key takeaways

Five-year, 100% take-or-pay helium offtake agreement with investment-grade counterparty, reducing volume and demand risk.

Fixed base price of $285/MCF on an all-in plant-gate basis, with annual CPI-linked escalation starting March 2028.

Counterparty assumes all downstream transportation and processing costs, providing clean netback to the Company.

Commencement Date targeted for March 1, 2027, with contractual outside date of July 1, 2027.

Year-three price redetermination with right of first refusal at a 5% premium for the counterparty.

Agreement supports initial helium sales and carbon management operations targeted for Q1 2027.

Full analysis

The Helium Sales Agreement represents a critical milestone for U.S. Energy Corp., transitioning its Big Sky Carbon Hub from a development-stage asset to a contracted industrial gas platform. The agreement with an investment-grade global industrial gas company provides long-term contracted cash flow, materially reducing volume and demand risk through a 100% take-or-pay structure. The fixed plant-gate pricing of $285/MCF, with no downstream cost exposure, offers a clean and predictable netback. Annual CPI-linked escalation provides inflation protection, while the year-three price redetermination mechanism allows for potential upside. The agreement de-risks Phase 1 commercial operations, which remain targeted for Q1 2027, and complements the Company's carbon management strategy. Combined with the recently expanded senior secured credit facility, U.S. Energy now has a fully funded Phase 1 capital stack and secured revenue stream, positioning it within the global industrial gas value chain.

BSIN · U.S. Energy Corp.

Summary

Key takeaways

Full analysis