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“The next 1,000 unicorns won’t be search engines or social media companies, they’ll be sustainable, scalable innovators – startups that help the world decarbonize and make the energy transition affordable for all consumers. – Larry Fink, 2022 Letter to CEO’s
Helium is not just about party balloons
When it comes to investing, people are awakening to the fact that we need to focus on our planet, our people, and company fundamentals. We need a strong foundation to build upon, and we’re starting to see smart money shift to the commodities that will fuel our future. One of these commodities is helium. More than ever before, we’re in desperate need of critical gases on a global scale.
To many, helium may seem like a novelty sector, but nothing could be further from the truth. The global helium market size was estimated to be 6,688 million cubic feet in 2020, and the total worth of this market is expected to reach US$3.5 billion by the end of 2027. As global demand heats up, supplies are dwindling. The U.S. is the largest helium producer worldwide, followed by Qatar, Algeria, Russia, Canada, and China.
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A driving force behind futuristic technology
Technology is an obvious driving force behind the surge in helium demand. The gas acts as a high-tech coolant for microchips, gaming systems, data farms, crypto mining farms, solar cells, and coolants for nuclear reactors. It heats critical hardware components and has the remarkable ability to push memory processing power onto smaller and smaller chips and motherboards. This ability positions helium as a key component of the smaller, faster, stronger memory technology race.
Helium is also central to a number of futuristic initiatives, including Google’s Project Loon and Bezos’ Blue Origin, not to mention the Large Hadron Collider (LHC), the world’s largest and highest-energy particle collider that was built by the European Organization for Nuclear Research (CERN).
To put the helium growth story in perspective, the U.S. electronics market is the largest market in the world, in terms of size. There’s been a significant increase in the number of manufacturing plants and development centers in the U.S., which is expected to further boost helium demand. Here in Canada, the consumer electronics industry is booming due to the high value placed on product innovation. The production of semiconductors is also expected to increase in Canada, which will further fuel market demand for helium.
A major player in the healthcare sector
Helium plays a major role in healthcare which is a rapidly growing industry. It can reach a temperature of -269° C, making liquid helium the best option for cooling the magnets of MRI machines. Demand for helium in the healthcare industry is increasing, owing to the rising demand for MRI scans.
Helium is also used for breathing observation and is essential in treating emphysema, asthma, and other conditions that affect breathing. Oxygen and helium are used to treat acute and chronic respiratory ailments, as the combination reaches the lungs faster than all the others. There is no substitute for helium in cryogenic helium applications.
Furthermore, while the pandemic wreaked havoc on many sectors and stocks, it had the opposite effect on helium, as the need for helium-cooled cases to store and transport vaccines continues to drive global demand.
A key noble gas explorer who discovered a hydrogen field
Desert Mountain Energy (TSX.V:DME) is an early-moving exploration and development company with serious skin in the game. They’re focused on helium, oil & gas, and mineral properties in the Southwestern U.S., and their Holbrook Basin property is considered to be “the world’s best for helium.” DME is further emboldened by state-of-the-art technology and a highly experienced team that’s been carefully selected for their unique, multi-disciplinary expertise in surveying and drilling.
DME had some big news to share, with recent drilling operations resulting in the discovery of a new gas field in Arizona with significant gas flows. Dry gas samples have been collected and sent to an independent lab for a total gaseous analysis, with results expected soon.
Also in Arizona, DME recently encountered the largest number of helium and hydrogen showings from all wells drilled so far on its Gunnar Dome prospect. Mass spectrometer readings during drilling operations clearly delineated multiple zones with helium, hydrogen, or argon present.
Adding to the good news this year, DME discovered exceptionally high helium grades of 3.5%, which will be processed in the company’s McCauley Helium Processing Facility. DME is building the first solar-powered helium processing facility using hydrogen as a backup power source in North America. The company’s goal is to produce as close to a zero-carbon footprint from its operations as possible.
In addition to being a major player in the U.S. helium space, DME’s strategy includes monetizing the potential of their sulphur-free hydrogen assets. In support of this strategy, the company recently teamed up with Beam Earth Ltd., an expert in cost-effective and innovative methods to produce hydrogen-related products. This agreement encompasses current company holdings in Arizona and will be expanded into other jurisdictions.