Ann: Driller Arriving on Location to Drill BBB 33, page-10

New Hannam & Partners update

Blue Star Helium

33% uplift in 2C net recoverable helium resource at

Voyager increases our risked NAV

Spudding of two helium wells at the Voyager Development project

Blue Star Helium ("BNL") has successfully spudded two helium development wells at its Voyager project in Las Animas County, Colorado, moving closer to commercial production. In early December 2023, BNL spudded the BBB=33 well, which is adjacent to the BBB#1 well previously tested in November 2021 encountering an air-free gas concentration of 8.8% helium (some of the highest seen globally) in a 134ft gas column in the Lyons formation. This was followed by the drilling of the Bolling #4 SESW well in late December 2023. This well is located south of the BBB=33 well and is adjacent to the lACX Energy's ("ACX*) helium recovery unit. The drilling contractor, Hydro Resources Rocky Mountain, has drilled the surface hole to 42ft and cemented the 13 3/8" casing for both wells, preparing them for the main rig which is anticipated to arrive in the coming days.

Voyager 2C contingent resources increase by 33% to 857 mmcf

BNL announced that Sproule updated the independent assessment of its 2C net

unrisked contingent resources at Voyager to 857 mmcf （+33% from previous estimates

of 643 mmcf). The increase is attributed to the acquisition of 1,584 acres of mineral leases ahead of commissioning IACXs helium production facility Q1'2024. The updated assessment also states a 3C upside of 1.57 bcf (+28% from 1.23 bcf). We have increased our assumption of the recoverable volumes at Voyager accordingly by extending the plateau production by four years adding a further six wells, which increases our risked valuation by US$13mm or US$10mm unrisked (AS0.01/sh). Our unrisked valuation of Voyager alone is now around three times Blue Star's current market capitalisation.

Regulatory approval to drill three more wells at Voyager

In addition to BBB#33 and Bolling #4 SESW, BNL received regulatory approval to drill three additional helium development wells at Voyager by the Colorado Energy & Carbon Management Commission - Daniel 08 SWNE, Bolling 04 NWSE, and Bolling 09

NWNW.All these wells are located in close proximity to LACX's helium recovery unit.

This puts BNL's initial production inventory to six wells. The Voyager development project is -25 miles from the Red Rocks project owned by Desert Eagle Operating LLC ("DEO") which is producing helium from 3 wells, from the Lyons formation and is connected to an IACX processing plant. The positive takeaways are high production rates, consistent production, and no decline in flow rates seen to date. All of BNL's Voyager wells are also targetting the Lyons reservoir and using the same processing company giving a positive read across the projects. BNL will also drill larger open hole production wells in line with engineering advice and learnings from Red Rocks.

Valuation: 700% upside to our risked NAV of A$0.18/sh|

In our base case, we use a helium price of US$550/mcf long-term flat and a 10% discount rate. Our risked NAV on a fully diluted basis is increased to A$0.18/sh from the higher resources at Voyager and rolling our model forward to 2024. A US$50/mcf increase in the helium price would increase our risked NAV by AS0.02/sh (+10%). At the end of Sept 23, BNL had A$2.5mm in cash and no debt. The leasing option with IACX avoids debt funding. BNL has mortgaged the Voyager mineral lease as collateral to secure the payments required to lAX meaning no cash is required. BL has not signed any long-term offtake agreements and retains exposure to the strong helium short-term and spot market. Current spot pricing is substantially higher than typical long-term contract pricing.

Blue Star Helium | H&P Research"

4" January 2024

Tickor

Market cap 4-Jan 24 (USSm) |

Share price 4-Jan-24 (AS)

NAV summary (AS/sh)

Source: HUPE

ASX: BNL

33.1

0.022

	Asset	Unrisked	Risked
1	Core	0.12	0.09
2	Development	0.24	0.07
3	Exploration	0.11	0.02
4	Total NAV	0.48	0.18

0.04

003 111

0.03

- 10

0.01 1

0.01

0.00

2323 23 Q3 23 23

JM

• Volume (mm)
• Helium Index (Rebased)
• Blue Star Helium (USD) |

Source: S&P CapiQ

Anish Kapadia

Research Analyst

T +44 (0) 207 907 8500

E anish @Hannam nartners

Roger Bell

Managing Director, Research

T +44 (0) 207 907 8534

E me nannam gertners.

Andy Crispin

Sales

T +44 (0) 207 907 2022

E andycrispin@Hannam patnecs

H&P Advisory Ltd

7-10 Chandos Street|