Helium Exploration
How do you find Helium?
The process of drilling for helium is identical to drilling for natural gas, allowing for the use of the same rigs, tools and personnel in these operations. However, helium exploration is technically challenging and requires significant technical knowledge related to helium generation (from the underground decay or uranium and thorium), concentration and migration through formation fluids, exsolution and migration to traps in a gas phase, and reservoir evolution through time. Specialized expertise and methods across multiple disciplines are required to effectively search for new helium fields.
Once a commercially viable helium reserve has been discovered and development wells have been drilled, there are two stages in the production of helium, which can be combined into a single plant for larger deposits of helium.
Helium Exploration in Action
The keys to finding and proving a helium reservoir are:
- Isolating interval of interest in the well
- Flow the well to determine a gas flow rate
- Shut-in the well downhole to measure an accurate reservoir pressure and for pressure transient analysis (PTA)
- Capture representative gas samples for lab analysis to measure Helium content
This was efficiently accomplished in the open hole prior to committing to casing and completion expenditures with Northstar’s Open Hole DST systems.
Learn more about how we met all of the largest Canadian Helium company’s objectives:
How much does Helium Cost?
The helium price increases as you get closer to the consumer and with purity. Crude helium (50 – 80%) has been going up. In FY2018 it averaged US$119.31/Mcf, in 2019 averaged $160.64/Mcf. This pricing was based on auctioned lots from the US Federal Helium Reserve. Today (2021-06-18), the present spot market has significantly higher prices than contracted, with prices as high as $1,000/mcf paid by some end users.
Why are helium prices going up so fast?
Not a surprise, but it is based on supply and demand. The US Bureau of Land Management (BLM) managed a strategic stockpile in Amarillo, TX. In 1996 a bill was passed to sell off most of the stockpile to recover the operation’s debt. In 2013 it was decided to increase the amount auctioned annually. This kept the market price artificially low for decades. As the reserve stockpile came closer to the minimum allowed level of 3Bcf, the price started rising. As of September 2021, the US Federal Helium Reserve will cease selling and this news sent prices skyrocketing. Additionally, the majority of Helium in the USA was extracted from natural gas production as a by-product. Helium only exists in deep formations. The relatively shallow shale gas structures being pursued today in the US do not trap Helium; nearly eliminating one of the biggest sources.
The demand side of the story only compounds the situation to drive prices higher as helium is used in manufacturing semiconductors and rocket propulsion; just two of the rapidly growing markets using helium.
Where does Helium come from?
Most of the helium that occurs in natural gas is proposed to have been formed by the radioactive decay of uranium and thorium in granite-type rocks that are present in the continental crust of the Earth. As a very light gas, helium is buoyant and seeks to move upward as soon as it is formed. Very few natural gas fields contain enough to justify a helium recovery process. Generally, a natural gas source must contain at least 0.3% v/v helium to be considered as a potential helium source.
The richest helium accumulations are found where three conditions exist: (1) granitoid basement rocks are rich in uranium and thorium, (2) the basement rocks are fractured and faulted to provide escape paths for the helium, (3) porous sedimentary rocks above the basement faults are capped by an impermeable seal of halite or anhydrite. When all three of these conditions are met, helium might accumulate in the porous sedimentary rock layer. James G. Speight Ph.D., D.Sc., in Natural Gas (Second Edition), 2019
What is Helium used for?
Magnetic Resonance Imaging (MRI), 30%; lifting gas, from party balloons zeppelins 17%; analytical and laboratory applications, 14%; welding, 9%; engineering and scientific applications, 6%; leak detection and semiconductor manufacturing, 5% each; and various other minor applications, 14%
Who produces Helium?
USA is currently the biggest producer (~50%) with Qatar (~30%) rapidly gaining market share. Iran also has similar potential to Qatar as they share the same gas field (North Dome in Qatar and South Pars in Iran), which is a deep, high pressure natural gas reservoir with relatively high Helium content. However, Iran has not made the infrastructure investment to capitalize on the resource.
Other countries produce significantly less (Algeria 10%, Russia 3.5%, Australia 2.8%, Poland and Canada ~1%)
Why does Helium make my voice sound funny when I inhale it?
Speech is created by the air you exhale vibrating your vocal cords. The pitch of your voice is determined by the size and shape of your vocal tract. Certain wavelengths resonate like in a cave or cathedral. Sound travels almost 3 times faster in Helium than air. If the air is replaced with helium, the sound travels over those same wavelengths faster resulting in higher frequencies (higher pitch).
Find information on any of our DST services.
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