South Africa strikes record helium find

Once the world’s largest gold producer, South African prospectors have stumbled across helium - a new treasure.

The gas is often associated with birthday balloons and squeaky voices. Helium is vital in the operation of medical scanners, space travel, and superconductors. Places where helium is produced are rare. There are presently less than 10 countries where it is treated as a waste product in natural gas wells. 

When the two South Africans, Stefano Marani and Nick Mitchell purchased the rights on an 87,000-hectare parcel of land for $1 in the Free State province in 2012, they had their eyes set on natural gas. When the gas find was tested, an unusual amount of helium mixed in with the gas was discovered - indicating a find whose value is in the billions. 

Free State helium player Renergen, another company, is also looking to start producing both natural gas and helium. South Africa has an elite map of helium reserves that could be among the world’s richest and cleanest. The first tests show helium concentrations of between 2 and 4 percent.

In the United States, the helium extracted has a 0.3 percent concentration. Renergen reveals finds whose concentrations are upto 12 percent. Other major helium producers are Qatar and Algeria. 

In 2019, the global helium market is valued at $10.6 billion according to the Research and Markets firm. Given few countries produce helium supplies are often disrupted.

According to Renergen estimated helium reserves are over 9.74 billion cubic meters - more than the entire reserves in the United States. This should be enough to fill over 1.4 trillion party balloons. 

Once proven, the Marani reserves are valued at over $100 billion with more conservative estimates showing a substantial 920 million cubic meters. Helium is normally produced as part of liquified natural gas operations with companies treating it as a bonus. According to the University of Oxford chair of geochemistry Chris Ballentine, helium production is often regarded by companies as a bonus in the production of natural gas. 

Normal conventional extraction of natural gas involves fracking - the process of injecting water, sand and chemicals at high pressure so as to split the bedrock and release the oil and gas trapped inside. For all its worth, fracking can be dangerous in its contamination of the groundwater resulting in minor earthquakes that can cause damage to nearby permanent structures. 

South Africa’s find is unique particularly in reference to the method of extraction. Stefano Marani points out that the bedrock is already cracked so drilling happens within the giant fracture and gas is extracted smoothly with no need for stimulation. Renergen is looking to drill 19 wells by early next year.

The gas currently extracted is presently used as compressed natural gas in a pilot project involving buses. This plant will process liquified natural gas in domestic use and liquid helium for exportation worldwide. Achieving liquid helium requires cooling to  an absolute zero temperature. This attribute of helium alongside its inability to burn or interact with other gases make it best suited for cooling super hot things. Thus its suitability on the magnets on MRI scanners or rocket engines.

Demand prices for helium have more than doubled in the past three decades. As the use for helium picks up, countries are worried over securing a steady supply. The United States, Russia and Tanzania are all working towards developing new reserves.