02:26:19 EDT Thu 28 May 2020
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Desert Mountain Energy Corp
Symbol DME
Shares Issued 35,205,051
Close 2019-02-19 C$ 0.235
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Desert Mountain MOU ended by City of Flagstaff

2019-02-20 06:42 ET - News Release

Mr. Irwin Olian reports


The City of Flagstaff has terminated the memorandum of understanding with Desert Mountain Energy Corp. for mutual co-operation and strategic development of helium and hydrocarbon resources in the greater Flagstaff region and Coconino county, Arizona. The newly elected city council determined that it had not had sufficient opportunity to address community concerns and elected to serve the company with a written 10-day termination notice in accordance with the terms of the MOU. At the same time, the council terminated the related licence agreement providing the company with limited access to city-controlled ground at Red Gap Ranch for purposes of seismic studies. The licence agreement will continue for a period of six months during which time the company may complete seismic studies if it elects to do so, subject to sharing the results of such studies with Flagstaff.

According to Irwin Olian, chief executive officer of the company: "We are disappointed that the City of Flagstaff has determined to pull back from its co-operative strategic relationship with the company under the MOU, but understand that development of helium resources is outside the scope of their expertise and experience and there has been little opportunity for study by the new city council. We hope to have the opportunity in the near future to provide additional information and make a full presentation that addresses all concerns.

"Helium has now been designated a strategic commodity by the U.S. government and it is a green commodity that is in great demand by the high-tech community and new economy. It is now used in hard drives of computers at the big data centres to increase efficiency by allowing the computers to run smoother and cooler, lowering energy costs. It is used in MRIs throughout the world to cool their big magnets. It is used to cool the cores of nuclear reactors to prevent meltdowns. It is being used by Google in its Project Loon to bring Internet to remote areas all around the world through a series of helium balloons in the upper atmosphere. It is used as a lifting gas and a host of other everyday uses like bar code readers in supermarkets. Even here in Flagstaff, Northern Arizona University scientists were advocating the use of helium in autonomous vehicles as a coolant to create energy efficiency for electric vehicles, thereby increasing range. Helium is inert, non-flammable, non-combustible and is a great boon to mankind, whilst free of any of the negative side effects of other gases and chemicals. It is so safe that divers regularly breathe it in their scuba tanks where it is mixed with oxygen. Helium extraction is minimally invasive and is done through shallow wells with very narrow pipes rather than mining operations, so there is no mine or unsightly scarring of the ground.

"All of the company's helium leases were obtained on ground leased by the State of Arizona and the U.S. Department of the Interior Bureau of Land Management. Hence, termination of the MOU will not impact existing exploration and development plans on the company's leases.

"We do hope, however, that over time Flagstaff will reconsider its position and recognize the opportunity which helium development could create locally for significant cash flow, job and infrastructure development with little or no footprint on the environment or local communities."

About Desert Mountain Energy Corp.

The company is an exploratory resource company engaged in exploration and development of helium, oil and gas, and mineral properties in the southwestern United States. Until Sept. 5, 2018, the company also owned the Yellowjacket gold project in Atlin, B.C., which it had been developing. The company has its executive offices in Vancouver, Canada. The company was incorporated under the laws of the Province of British Columbia, on April 30, 2008, and was formerly named African Queen Mines Ltd. It initially received certain Southern African assets in a spinoff transaction related to the acquisition of Pan African Mining Corp. by Asia Thai Mining Co. Ltd.

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