D3 Energy (ASX:D3E) has successfully spudded the first of two planned wells at Nooitgedacht, located within the ER315 permit in Free State, South Africa.

The milestone marks the next phase of the company's ongoing helium exploration and appraisal program, which is aimed at expanding D3 Energy's reserve base within ER315 and converting additional exploration right areas (ERs) into production rights.

Helium is a critical input across semiconductor manufacturing, MRI imaging, aerospace, and fiber-optic production, with global supply historically concentrated in a small number of producers including the United States, Qatar, and Algeria. Periodic supply shortages over the past two decades have driven exploration interest in emerging helium provinces, with projects in Tanzania, southern Africa, and North America seeking to diversify the supply base.

The Nooitgedacht area sits approximately 43 km north of a zone where the company has already booked reserves to support a production right application lodged last year. It is positioned along the Homestead Fault, which traverses the northern section of ER315.

The new drilling program will comprise two wells and will be carried out by the same contractor that successfully completed D3 Energy's initial drilling campaign.

The wells are situated near the Nooitgedacht Major historical borehole, which, when production tested in January 2025, flowed at an average rate of 95 thousand standard cubic feet per day (Mscfd) with helium concentrations of 5.6% and methane at 83.2%. Helium concentrations above 0.3% are generally considered economically significant for dedicated helium extraction, placing the reported concentration well above typical commercial thresholds.

"The spudding of our first well at Nooitgedacht is another step forward in our methodical appraisal of ER315 as we look to build upon and extend the company's ER315 reserve base some 40 km to the north, all the while underpinning the conversion of existing exploration right areas to production rights," said Managing Director and CEO David Casey.

"With our production right application accepted for processing by Petroleum Agency SA last year, this drilling programme is about continuing to build the data set that supports the ongoing development of this area as one of the most compelling helium provinces in the world."

Following the successful intersection of gas, the new NGT245 E well will undergo production testing, which will provide critical insights into the ongoing development of ER315. The results will inform key decisions regarding well interference, spacing, and the future submission of additional production right applications to South African authorities.

D3E shares were up 14.5% to 35.5¢, with a market capitalisation of $46.84 million.