Proactive Investors - Garish party balloons that, two days after the big event, finally lose their fight with gravity, and the metallic canisters used to fill them—these, along with possibly cheekily inhaling the contents of said balloon to create a high-pitched squeak, are likely the only interactions most of us have had with the inert and completely harmless gas helium.
Yet this lighter-than-air element is pivotal to the world’s developed economies, and its importance is growing by the day. Helium is an invisible but vital component in medical imaging, aerospace engineering, and semiconductor manufacturing. Its unique properties—such as high thermal conductivity, chemical inertness, and cryogenic capabilities—make helium indispensable in applications where no viable alternatives exist.
Critical element
Helium is classified as a critical element by governmental bodies in the US and EU due to its essential role in energy transition, digital transformation, and space exploration. Despite its significance, the helium market faces chronic supply shortages and price volatility, driven by limited production diversification and geopolitical tensions. The world’s supply depends primarily on just three countries—the US, Qatar, and Algeria. With so few sources, the helium market is particularly sensitive to disruptions; even a plant shutdown can send shockwaves through the market.
“Although helium production capacity is expected to increase if Qatar and Russia ramp up production, this does not necessarily guarantee a disruption-free helium supply moving forward, considering geopolitical tensions in regions where helium is largely produced,” says a report from the market research firm IDTechEx, which expects demand for the gas to double by 2035.
Rampant demand
If this analysis holds true—rampant demand coupled with constrained supply—then the price of helium is likely to be squeezed higher, particularly as there is no obvious or cheaper alternative. Indeed, we are seeing this play out before our eyes. The cost of grade-A helium has nearly doubled since 2020, rising from $7.57 per cubic metre to a historic high of $14 in 2023, according to the US Geological Survey, which tracks the market’s fluctuations.
For those who produce helium, this is the perfect storm. London, which has long supported oil and gas exploration start-ups, has now become a magnet for the next generation of helium producers. We've seen the stock market listings of Georgina Energy and Helix Exploration, while Helium One was a pioneer in a field now joined by Voyager Life .
The pioneer
Let's start with the longest-established of the quartet, Helium One Global Ltd (LON:HE1H). Until recently, its focus has been Tanzania’s Rukwa Rift Basin, which over the last decade became a hotbed of oil and natural gas exploration. Under the leadership of chief executive Lorna Blaisse, the company is now showing tangible results from its exploration and development activities. An extended test on its Itumbula West-1 well successfully flowed helium in concentrations of up to 7.6%—a very good grade by global standards—at an average of 786 barrels per day from Itumbula's faulted Karoo interval. Over a five-day test period, ITW-1 averaged 5% helium. CEO Blaisse declared herself "very pleased" with the results, adding, "This is a globally unique helium play, and it has taken a lot of hard work and collective effort across multiple disciplines to establish how this system works in the southern Rukwa Basin."
In a forward-thinking move, Helium One has acquired an American asset that could begin production by mid-next year, generating cash that could then be reinvested in Tanzania. The planned $6.75 million purchase of a 50% working interest in the Galactica Pegasus Helium Project in Colorado was lauded by City broker Panmure Liberum, which values Helium One’s stock at 3.44p—more than double the current price.
Well redeveloper
Georgina Energy PLC (LON:GEX), led by chief executive Anthony Hamilton, is focused on well redevelopment. Its blueprint, conceived by technical director John Heugh, is to re-enter wells in Western and Central Australia abandoned in the 1980s, where the success rate was 100%. This approach is cost-effective for accessing geological formations rich in hydrogen and helium—both in high demand in the modern green economy—as well as traditional natural gas.
Work will commence at the Hussar project in preparation for drilling in December, expected to take around 50 days. The historic nature of Georgina’s EP513 target means there’s already a drill pad, access roads, and nearby oil and gas infrastructure. A rig can be mobilised and on-site in days. Hussar is one of two Georgina projects with a combined footprint of 3,951 km²—the second being Mt Winter, a farm-in that gives the company the right to earn up to 90% of the asset. To finance these development costs, Georgina raised around £5 million via a reverse takeover transaction, listing the company on the LSE’s standard list in July.
Hit the ground running
HeLIX Exploration PLC (LON:HEXH)'s focus is the Montana Helium Fairway in the US, and its progress since its heavily oversubscribed £22 million IPO has been impressive under the stewardship of chief executive Bo Sears and chairman David Minchin. The company quickly commenced drilling into the highly prospective Ingomar Dome area with the Clink #1 well, targeting multiple stacked reservoir formations known for their nitrogen-rich gas deposits, including the Amsden, Charles, and Flathead formations. Clink is the first of a two-well drilling programme. In its latest update, Helix reported ‘significantly elevated’ levels of helium from the current operation, though it emphasised that further testing and analysis are necessary to determine the size and commercial viability of the helium resource.
Get 'f' into Dodge?
Lastly, Voyager Life PLC (AQUIS:VOY) under the leadership of Nick Tulloch, is gearing up to start production at its operation near Dodge City, Kansas. The Rost well is set to begin producing helium soon, with a grade of 5.1%. The well has been completed, and the company is preparing to extract, purify, and transport the helium to market, all on-site due to the remote location.
With these companies at the forefront, London is positioning itself as a key player in the next wave of helium exploration and production, as the demand for this crucial element continues to rise.