Two Harbors City Council Approve Agr Rare Gas Hub

Pulsar secures city approval for rare gas hub, but project remains highly conditional.

What the company is saying

Pulsar Helium Inc. is announcing that the City Council of Two Harbors, Minnesota, has approved a Purchase and Development Agreement for the proposed Rare Gas Hub, a facility intended for helium liquefaction and carbon capture. The company frames this as a major strategic step to strengthen the U.S. rare gas supply chain, emphasizing city support through discounted land, infrastructure contributions, and potential tax abatements. The agreement is described as a framework, not a binding commitment to build, with multiple conditions and approvals still outstanding. CEO Thomas Abraham-James positions the announcement as a milestone, but acknowledges that financing, engineering, and utility arrangements must be finalized before construction can begin. The company highlights the industrial location, access to rail and road infrastructure, and the potential for future expansion, but does not provide operational or financial performance data. The tone is optimistic but measured, with repeated caveats about the conditional nature of the project and the absence of current gas processing customers or agreements.

What the data suggests

The disclosed figures are specific to the transaction structure: Pulsar MN is to acquire land appraised at US$143,200 for a nominal US$1.00, subject to closing conditions and a final survey. The City of Two Harbors offers up to US$1 million toward rail construction, site clearing, and utility extensions, and will reimburse 90% of the increased portion of its share of ad valorem property taxes attributable to the initial Rare Gas Hub phase for 15 years. The total value of city assistance is not finalized, and estimates for infrastructure and tax abatements remain pending. The agreement provides a 365-day due diligence period from October 14, 2026, after which either party may terminate if no project commitment is made. If Pulsar commits, commercial operation of the initial phase is required within 36 months, but no construction or service commencement date is set. All benefits are contingent on securing financing, regulatory approvals, utility agreements, and other supporting contracts. No revenue, customer contracts, or economic assessments are disclosed, and the company explicitly states it has no gas processing customers or agreements in place. The data supports the existence of a conditional framework but does not evidence project viability or imminent value creation.

Analysis

The announcement is positive in tone, highlighting the approval of a Purchase and Development Agreement for a Rare Gas Hub, but the actual measurable progress is limited to the signing of a conditional agreement and the start of a due diligence period. Most of the key benefits—such as the construction and operation of the facility, city financial support, and tax abatements—are forward-looking and contingent on multiple unresolved factors, including financing, regulatory approvals, and utility arrangements. The capital intensity is high, with references to significant infrastructure (helium liquefaction, carbon capture, rail, utilities), but no immediate earnings or operational impact is expected, and the company is not yet committed to proceed. The execution timeline is long-term, as commercial operation is required within 36 months of a future project commitment, which itself is not guaranteed. The narrative inflates the signal by emphasizing the project's potential and city support, while the data only supports the existence of a framework agreement with many conditions outstanding.

Risk flags

• ●Execution risk is high, as the agreement is non-binding and subject to multiple closing conditions, including financing, regulatory, and utility approvals. Failure to secure these could prevent the project from proceeding.
• ●Financial risk is significant, with capital requirements for rail, utilities, and facility construction not fully quantified, and no committed funding or third-party processing contracts disclosed. The city's US$1 million contribution is capped for rail, and all other infrastructure costs above this are the company's responsibility.
• ●Regulatory and permitting risk is present, as the project requires land-use approvals, environmental reviews, and potentially TSX Venture Exchange approval. Delays or denials in these processes could halt development.
• ●Market risk exists because the company currently has no gas processing customers or agreements, and the project's economics depend on future demand and successful customer acquisition. The potential for third-party toll processing is only under evaluation, not secured.
• ●Disclosure risk is moderate, as key figures such as total city assistance, infrastructure costs, and tax abatement values are not finalized, limiting transparency on the project's true financial impact.

Bottom line

This announcement signals that Pulsar Helium Inc. has secured city-level approval for a rare gas hub site at a nominal US$1.00, with city support valued up to US$1 million for rail and 90% property tax reimbursement for 15 years, but all benefits are highly conditional. The agreement is a framework, not a binding commitment to build, and the company must complete due diligence, secure financing, finalize utility and regulatory agreements, and obtain further approvals before construction can begin. No operational, revenue, or customer milestones have been achieved, and the company discloses it has no gas processing customers or contracts. Investors should view this as an early-stage, high-risk pre-development milestone with a long and uncertain path to value realization. The most important takeaway is that while city support is real, project execution and economic viability remain unproven and contingent on multiple future steps.

Announcement summary

(AIM: PLSR) (TSXV: PLSR) (OTCQB: PSRHF) Pulsar Helium Inc. announced that the City Council of Two Harbors, Minnesota, has approved a Purchase and Development Agreement dated October 14, 2026, between the City and Pulsar Helium MN, Inc., its wholly owned subsidiary. The Agreement provides a framework for Pulsar MN to acquire land within an existing industrial district of the City for US$1.00, subject to closing conditions and required approvals. The land is appraised at US$143,200, and the final boundaries and legal description will be established by a final survey approved by both parties prior to closing. The proposed development is a Rare Gas Hub (RGH) for helium and other rare-gas processing, including helium liquefaction and carbon capture capabilities. The Agreement contemplates phased development, with the initial phase including a helium liquefaction and carbon capture facility as referenced in Pulsar's prior news releases. The City’s support includes up to US$1 million toward rail construction, site clearing, utility extensions, and reimbursement of 90% of the increased portion of the City's share of ad valorem property taxes actually paid by Pulsar MN and attributable to the initial RGH phase for 15 consecutive tax-payable years, unless otherwise agreed in writing. The total value of City assistance has not yet been determined, and certain infrastructure estimates and the estimated value of the tax abatement remain to be finalized. Pulsar will pursue separate tax abatements from Lake County and the Lake Superior School District. The site offers access to regional rail and road infrastructure, but rail connections, utility capacity, reliability, service dates, and commercial terms remain to be confirmed. The Agreement does not constitute an irrevocable commitment by Pulsar to construct the Project. Following formal project commitment, Pulsar MN must achieve commercial operation of the initial RGH phase within 36 months, subject to permitted extensions. The City retains permanent rights to use the rail service for municipal purposes and to make it available to other customers for a fee. The Agreement provides Pulsar MN with a 365-day due diligence and pre-commitment period from October 14, 2026, after which either party may terminate the Agreement if no Project Commitment Notice is delivered. Closing is to occur no later than 10 business days after the Project Commitment Notice, subject to satisfaction or waiver of closing conditions. Remaining work includes completion of due diligence, securing financing, obtaining land-use and regulatory approvals, execution of supporting agreements, and utility studies. The proposed Facility is designed to compress and process industrial gases, including helium and carbon dioxide, converting gas into liquid form for storage and distribution. The Company intends to design, construct, and operate the Facility in compliance with all applicable requirements. The Company is also evaluating the potential for third-party gas processing services but currently has no gas processing customers or agreements in place. The Agreement permits changes in equipment suppliers, technology, configuration, and construction sequencing within its stated conditions. Completion of the transactions remains subject to applicable conditions and required regulatory approvals, including TSX Venture Exchange approval if required. Thomas Abraham-James, CEO and Director of Pulsar, commented that the City Council's approval is an important step in building a Rare Gas Hub to strengthen the U.S. supply chain for rare gases.

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