Interesting to reflect on SP movement and price of He.(topped up...

Interesting to reflect on SP movement and price of He.
(topped up today)
(AFR today)

While hydrogen grabs the headlines for its role in the low-carbon economy, helium is just as important because of its industrial applications in semiconductor production, fibre optics, rocketry and magnetic resonance imaging (MRI) scanners.

One of the six noble gases, helium is inert, nontoxic, lighter than air and has high thermal conductivity (it removes heat in space applications and electronics manufacturing). It’s also one thousand times more conductive than copper.

Because of its small molecular size, helium is useful for finding the smallest of leaks in applications such as offshore welding. Party balloons remain a popular – albeit diminishing – application.

With the world facing its most acute helium shortage, spot prices for premium-purity products have soared above $US3000 ($4250) per thousand cubic feet, a circa 300 per cent increase on a year ago. Anecdotal reports suggest prices exceeding $US5000.

On industry forecasts, helium consumption will rise from around 6 billion cubic feet (bcf) per year currently, to more than 8 bcf by 2030. It’s also expected that semiconductor manufacturing will replace MRI machines as the biggest usage.

Helium is currently derived mainly as a by-product of LNG production, which makes Qatar the biggest primary producer. In the US, the Bureau of Land Management (BLM) historically supplied 40 per cent of the nation’s helium from a strategic reserve in Texas.

These reserves have been depleted for decades and are in the last stages of a messy privatisation. Meanwhile, supply has been further constrained by a fire and an explosion at the major Amur plant in far eastern Russia, a gas leak at a BLM facility in Texas and the diverting of Algerian gas from LNG production (and thus helium extraction) directly to hungry European users.

“Helium is in structural deficit; there’s simply not enough of it,” says Dane Lance, the managing director of ASX-listed ‘green’ helium entrant Grand Gulf Energy.