Big Sky Industrial Inc. Common Stock (NASDAQ:BSIN) said its first-phase helium project remains on schedule for initial production in spring 2027, with field infrastructure complete and fabrication of its processing plant underway.
On the company’s third-quarter earnings call, President and Chief Executive Officer Ryan Smith said long-lead equipment, including company-owned power generators, had been purchased. The generators are on site, while civil work is expected to begin in the coming weeks and equipment installation is scheduled from late in the fourth quarter into the first quarter of 2027.
The company also reported a third-quarter net loss of $3.5 million, or 7 cents per share, as it continues to pursue financing and awaits a federal decision on a carbon monitoring plan tied to potential tax credits.
Helium Project Advances Toward Production
Smith said production wells have been drilled and completed, gathering and injection lines are finished, and Class II injection wells are operational. The lines will carry gas to the processing facility and transport captured carbon dioxide to the company’s Big Rose sequestration asset.
At initial operations, the plant is designed to produce more than 14 million cubic feet of high-purity helium and capture approximately 125,000 metric tons of carbon dioxide annually, Smith said. He described spring 2027 as a production window that allows for commissioning and winter weather in Montana.
Big Sky’s helium is covered by a five-year, 100% take-or-pay agreement with an investment-grade global industrial gas company. The contract calls for 1.2 million cubic feet per month at a fixed plant-gate price of $285 per thousand cubic feet, with inflation adjustments beginning March 1, 2028, and a pricing redetermination in the third year. The buyer is responsible for transportation and delivery.
Smith said the Department of Energy designated helium a critical material on Oct. 23, citing its role in semiconductor manufacturing and supply-chain risks.
Carbon Plan Awaits EPA Decision
Big Sky’s monitoring, reporting and verification plan for Big Rose is in the final stage of the Environmental Protection Agency’s approval process, according to Smith. The company submitted the plan in October 2025, and the agency accepted it the following month after a federal government shutdown.
Smith said Big Sky has addressed the EPA’s comments and that nothing in the agency’s feedback has changed management’s expectation of approval. In response to an analyst’s question, he said the company had received roughly four to five rounds of comments, with the most recent around Labor Day. He characterized those comments as “extremely light” and said the company responded immediately.
Approval is not required to start the plant or sell helium, Smith said, because the injection wells are already permitted and operational. The timing instead affects when the company can generate and monetize Section 45Q carbon capture tax credits. A separate plan for the Cut Bank oil field, submitted in December 2025, remains under EPA review.
Quarterly Results and Financing
Chief Financial Officer Mark Zajac said third-quarter revenue was $2 million, up 12% from $1.7 million a year earlier. A 30% increase in the average realized price to $63.83 per barrel of oil equivalent more than offset lower volumes following a 2025 divestiture. Production totaled 30,628 barrels of oil equivalent, 76% of which was oil.
Lease operating expense rose to $2.1 million from $1 million, including approximately $1.2 million in remediation and related costs after a previously disclosed release of produced fluids from a gathering line in legacy oil operations. Zajac said the release was identified and remediated during the quarter.
The company has submitted an insurance claim and expects to recover up to $1 million, although no receivable had been recorded at quarter-end because the claim remains pending. Excluding remediation costs, lease operating expense was $0.9 million, or $29.71 per barrel of oil equivalent, Zajac said. Adjusted EBITDA, which also excluded the remediation costs, was negative $0.8 million, compared with negative $1.3 million a year earlier.
Big Sky ended the quarter with $2.9 million in cash and $14.4 million of total liquidity, including $11.5 million of undrawn capacity under its senior secured credit facility. Zajac said the company is discussing a larger senior secured facility and pursuing potential monetization of its phase-one 45Q credits.
Smith said Big Sky is in discussions with multiple potential credit-financing counterparties and that structures under consideration range from annual transactions to deals involving the entire credit pool. No agreement was announced.
Phase Two Planning
Big Sky is also engineering and planning a second, larger plant on the same footprint. Smith said the company expects to make a final investment decision in the coming months, after financing and final plant sizing are completed. He said existing acreage, permitted wells and geology could support two to three times phase-one capacity without additional land.
About Big Sky Industrial Inc. Common Stock (NASDAQ:BSIN)
U.S. Energy Corp., an independent energy company, focuses on the acquisition, exploration, and development of oil and natural gas properties in the United States. It holds interests in various oil and gas properties located in the Rockies region, including Montana, Wyoming, and North Dakota; the Mid-Continent region comprising Oklahoma, Kansas, and North and East Texas; West Texas; South Texas; and the Gulf Coast regions. The company was incorporated in 1966 and is headquartered in Houston, Texas.
