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A fistful of helium

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A fistful of helium

May 29, 2024 | 7:00 am ET
By Aaron Brown
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A fistful of helium
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The Iron Range is sitting atop another massive extraction resource. Who will benefit? Illustration by Getty Images.

BABBITT — When a mining company accidentally discovered a mother lode of helium at a site near here in 2011, Minnesota’s Iron Range stumbled into a complicated corner of the gas industry. Pulsar Helium of Canada licensed the site for exploration in 2021 and, after eye-popping test results, now plans the state’s first commercial helium operation.

Just one problem: experts at the Minnesota Department of Natural Resources and local mining engineers know little about helium. Unlike states to the west or south, Minnesota never produced gas. That is, unless we count the bean feed fundraisers that fueled Hubert Humphrey and Walter Mondale’s meteor-ish rise to the vice presidency.

Helium is a vital commodity — plentiful in the universe, but difficult to corral here on Earth. The Babbitt find is the first such discovery in Minnesota, and uniquely potent and clean. The project is turning heads in the gas industry while finding its way into publications like Popular Mechanics.

Pulsar CEO Thomas Abraham-James said tests conducted Feb. 22 show helium concentrations of 13.8% with no meaningful methane contamination. 

Joe Peterson, assistant field manager with the helium division of the U.S. Bureau of Land Management in Amarillo, Texas, said that’s twice as potent as some of the best wells in America. He said the 0.3% is the smallest commercially viable amount and some of the world’s biggest operations succeed with 0.5%.

“Anything more than that is phenomenal,” said Peterson. “It should be an excellent source of helium.” 

But he cautions that production totals often drop once production starts.

“Because helium is so small, it’s going to concentrate in your pipes,” he said. “You have to check the results. Those test results could be higher than what’s really there. When production starts, that will really tell the tale.”

The unearthing of valuable natural resources below ground is nothing new to the Range, but helium might upend expectations of big industry and jobs often associated with mining. Helium is light, and so is its economic footprint.

The issue also shines new light on old questions: who really owns what’s below ground, and who deserves a piece of the action once it goes to market? Mining taxation is the beating heart of Iron Range political history, but will today’s politicians and voters apply hard-won financial lessons of non-renewable resources to a new industry?

A law passed by the Legislature and signed by Gov. Tim Walz this month places a moratorium on the extraction of helium and other gases until a regulatory framework and tax structure is in place. The law allows the Legislature to issue a temporary permit if the process takes too long. It also places a 18.75% royalty on the sale price of any helium produced.

It’s rare for a discovery to thrust a state into a new industry like this, hence the need to create a fair process. But just like mining, the extraction of helium relies upon a fickle, fast-changing market. Prices spiked to historic highs last year, but have eased recently as supply and demand balance out.

We know the helium near Babbitt is valuable, but how much is actually there? If the supply is as great at Abraham-James hopes, “Minnesota could become the flywheel for the whole [helium supply] system.” 

See if it floats

So, let’s get this out of the way. Yes, when you inhale helium it makes your voice funny. And no, you really shouldn’t do this because inhaling too much can reduce your oxygen levels. 

Helium is used for much more than party balloons. Liquid helium is the only element cold enough to cool the magnets in MRI machines, crucial to the diagnosis of strokes, heart conditions, cancer and spinal cord injuries. Helium gas aids high-tech welding and the production of fiber optic cables and semiconductors. 

A fistful of helium
Helium tanks with compressed gas for industry. Getty Images.

The world produced about 6 billion cubic feet of helium in 2023, with the United States producing more than half of it. For the past decade, customers faced a global shortage of the gas and resulting price hikes. 

Just this January, the United States sold the Federal Helium Reserve in Amarillo to a private company, the Messer Group, in a deal that hasn’t been finalized yet. Helium buyers are concerned about the implications. This was the result of an almost 30-year political push to unload the federal facility, founded 100 years ago to store helium for military blimps.

Helium makes an excellent flight agent for dirigibles, with none of the Hindenburg-like downsides of hydrogen. That’s why balloons at the annual Macy’s Thanksgiving Day Parade still use helium.

But don’t let your blimp renaissance dreams run wild, though. The gas is worth too much for that now. 

Helium isn’t traded publicly like other commodities, so its pricing is hard to track. Prices peaked in 2022 with 1,000 cubic feet of helium selling for $450, twice the price in 2020. But that’s deceptive. Helium is cheaper in extremely large quantities, but more expensive in smaller ones. Buyers of helium — scientists, medical facilities, and manufacturers — never know what to expect when they need to refill their tanks.

The Pulsar Helium site at Babbitt could be uniquely situated, said Abraham-James, because Minnesota’s medical and tech sectors are large consumers of helium. The closer the customers are to the extraction site, the less gas is lost to along the way.

That’s the other complication; helium is the most elusive gas on the planet.

It’s squirrely

Helium is not like iron ore.

I mean, we knew that, right? But it’s astounding how different these elements are, even at the molecular level.

An atom of iron is heavy enough to start a chain reaction at the heart of a star that eventually causes a supernova, exploding stardust across the universe. We measure iron ore in tons and haul it from Minnesota’s Mesabi Range to Duluth in big trains made from iron.

An atom of helium is a squirrel being chased by three or four sumo wrestlers across a soccer field. Spoiler alert: They will not catch the squirrel. 

Helium is light AF. Do you know why your balloons go flat after a while? Because we can’t prevent helium atoms from escaping over time, not even from thick metal cylinders. They’re like Houdini. Every helium atom released into the air makes a beeline for space. It leaves our atmosphere and Earth’s gravitational pull without aid of propulsion. After that, it’s so light that it gets pushed away by solar wind. It might form a gas cloud somewhere west of Alpha Centauri, but it ain’t coming back.

Every day, 90 tons of ultralight hydrogen and helium leave Earth’s atmosphere forever. We aren’t making new hydrogen or helium, so in about 150 billion years our atmosphere will be depleted of these vital elements.

I know what you’re thinking. Don’t worry. Our sun will die long before then. 

Meantime, the capture and sale of helium on Terra Firma requires precise distribution networks and ready customers. Otherwise, fortunes will literally fly away.

Abraham-James said Pulsar’s helium stake is well situated to serve customers located within a day or two of the facility.

Lighter than air

Helium’s distinction from iron ore extends into employment, too. It won’t take very many people to extract helium from these deposits on the Iron Range. At a taconite mine, extraction occurs 24 hours a day, year round, requiring hundreds of shift workers. A helium operation runs only when helium is needed.

Abraham-James compares the facility Pulsar plans to “a medium-sized warehouse.” The process requires electricity to separate helium from other gases and then cryogenic distillation to render the gas into a liquid. At capacity, the facility might ship one 40-foot tanker trailer of helium each day.

“That’s what we’re aiming at,” said Abraham-James. “The reality has yet to be determined.”

Peterson said the region should temper expectations of widespread hiring.

“Once the equipment is there, most helium plans run efficient and effectively with very few personnel on hand,” said Peterson. “It won’t be hundreds of people. More like tens of people.”

Tens of people, extracting tens of millions of dollars in revenue from a very lucky hole in the ground.

The people of Minnesota, and the Iron Range specifically, should rightly capture the one-time revenue of helium extraction. Whether the industry lasts one year or one century, windfalls like this are not the product of innovation, but of consumption. The end is baked into the beginning. 

It’s the people’s resource, and the new legislation saying so must be enacted with haste. Every second counts. When helium leaves Minnesota, it’s going to leave fast. That’s just what helium does, in chemistry and economics alike.

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