North American Helium Launching Canada’s Largest Purification Facility in Saskatchewan
Canada’s largest helium purification facility will soon begin production in Saskatchewan. Calgary-based North American Helium (NAH) began construction of the plant near Battle Creek, in southwest Saskatchewan, in the fall of 2020 and it is expected to be in-service by July, 2021.
“We are fortunate to be operating in a jurisdiction with a supportive regulatory structure, favourable geology for helium production and a skilled workforce,” North American Helium's Chairman and CEO Nicholas Snyder said. “The government has shown a commitment to the development of this industry in Saskatchewan, which will contribute new production needed to replace depleting natural-gas-linked helium sources in North America. Our Battle Creek project demonstrates that reliable long-term production of helium can be created from non-hydrocarbon sources, which means a smaller environmental footprint while still benefiting from the expertise developed in Saskatchewan's oil service industry.”
North American Helium will market their own helium through long term sales contracts using high pressure tube trailers for transportation from the plant to access any market in North America or to liquify the helium for transport Overseas.
Recent regulatory amendments introduced an expanded Provincial Sales Tax exemption for exploratory and downhole drilling activity, which includes drilling for helium. Saskatchewan has a stable and highly competitive 4.25 per cent royalty rate for helium. In addition, the NAH project is utilizing the Oil and Gas Processing Investment Incentive (OGPII) through Saskatchewan’s Ministry of Energy and Resources, which provides new or expanded helium processing and liquefaction facilities with a 15 per cent transferrable royalty credit based on capital expenditures.
“There is a well understood, reliable regulatory regime in place and a royalty structure that goes hand in hand with the risk that companies take on to explore for helium. The land acquisition and tenure process allows for a longer term exploration and production horizon. It’s a low cost opportunity for us to get involved and there has been over 35,000 oil and gas wells drilled so there is a lot of data and information from a seismic perspective that we use to help us de-risk the plays that we’re chasing right now,” says North American Helium’s President and COO, Marlon McDougall. “We believe in working with the government and they have been responsive to industry needs with incentive programs that have been announced for investment and infrastructure as well as the innovation incentives. These will be very helpful for us and we will look to take advantage of some of these incentives to help us in the development of our projects.”
Saskatchewan has some of the best helium resource potential in the world, with significant underground reserves. Global demand for helium is increasing, as a global supply shortage has resulted in helium prices rising more than 160 per cent since 2017. Over the last five years, a growing number of helium wells have been drilled in Saskatchewan and it’s exciting to see the value added step of helium purification develop in the province.
Helium is used in various applications, including medical research and diagnostic testing, digital technologies, semiconductors, fibre optics, nuclear power facilities, rocket systems, welding and balloons.
North American Helium is a private company founded in 2013 and has acquired rights to explore for and produce helium on an expanding property base of approximately 4,000,000 acres in Saskatchewan and in the State of Utah. The company has a continuous drilling program, discovered substantial reserves of helium, moved their Cypress and Battle Creek fields to commercialization and are actively delineating several new discoveries.
Since November 2019, NAH has successfully raised approximately $123 million to support ongoing exploration, development and production operations.
Find out more about investment opportunities in Saskatchewan at thinksask.ca/invest
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