A new commercial helium purification facility is slated for construction in Saskatchewan, and it is going to be the largest in Canada.
On May 28, the Saskatchewan government announced that construction on the new facility will commence in October at an area near Battle Creek, which is adjacent to the Alberta-Saskatchewan border. Once construction is completed, it is anticipated that the facility will be in full operation sometime in July 2021. North American Helium is the company in charge of the construction and operation of the facility.
As the global demand for helium continues to grow, Saskatchewan is becoming an attractive place for extraction of the noble gas. Since helium extraction is similar in many ways to crude oil extraction, many of the same oilfield services can be employed in the industry, thus putting the oil industry’s displaced workers back into action. Furthermore, Saskatchewan has an attractive helium royalty rate of 4.25%, as well as a supportive regulatory structure. Some of these favorable amendments include a PST exemption for downhole and exploratory drilling activity.
Helium has an increasing variety of uses, and is being demanded more and more by the rest of the world. the gas is used for medical diagnostics and research, fibre optics, digital technologies, welding operations, balloons, and nuclear power operations. As a result, the supply of helium has not been able to meet demand, thus causing its prices to increase by over 160%. This new facility in Saskatchewan will not only aid in meeting some of the global demand, but also provide employment opportunities that contribute to a smaller environmental footprint.
Information for this briefing was found via the Saskatoon StarPhoenix and the Government of Saskatchewan. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.