Hi MohicansOne point to bear in mind here is that the company...

Hi Mohicans

One point to bear in mind here is that the company doesn't necessarily need to develop whatever helium assets they end up acquiring.

Helium is still viewed as a fringe commodity, particularly outside of the US and Canada. I suspect, however, this situation will change within the next five years.

From where I stand, there is some logic in looking to acquire helium acreage while this commodity is largely below the radar. Assuming they can acquire some decent helium assets over the next 12 months or so, they could be in a good position to offload the assets for a premium three or four years hence.

One trend that might help the company is the increasing worldwide concerns regarding the environmental impact of fossil fuels. Following on from a majority vote from Norwegian MPs last week, Norway's vast sovereign wealth fund is now required to sell down its position in fossil fuel producing companies.

And the same week, around a dozen heads of the major oil companies pledged to do their part in helping transition the world to a low-carbon future in a meeting with the Pope. I think it is reasonable supposition that fossil fuel producers are going to face growing community opposition and greater regulatory hurdles in the decade ahead.

The major mining companies, BHP and RIO, certainly seem to have arrived at this conclusion, as can be seen in their moves over recent years to steer away from coal, instead increasing their focus on metals such as nickel, copper and aluminium, which they expect will see increased demand from electric vehicles and renewables over the medium to long term.

In a similar vein, I think the major oil & gas companies will find themselves under increasing pressure to focus on less objectional commodities in the near future. The gas helium, which is an essential commodity for science and modern medicine, fits the bill quite nicely. The fact that the helium market has been growing at around 4% year on year for quite some time is likely to turn some heads as well.

One criticism I have regarding the company strategy is that I am not sure if it really makes sense to focus on North America, given that the helium story seems to have already gained some traction in this region. I suspect that it might still be possible to pick up a 1st class helium asset on the cheap in the countries where the commodity isn't yet being taken seriously.