Why Tanzania is poised to become helium powerhouse

Read: Helium One to start drilling world's rare gas in Tanzania

The company has over the past three years secured prospecting licences for nearly 3,000 square kilometres across three geological basins, namely the Rukwa, Balangida and Eyasi projects.

“These areas hold significant promise for helium exploration,” Ms Blaisse said, adding that the global helium market is characterised by high demand and limited supply.

The world’s leading helium producers are the United States, Qatar, Russia and Algeria, with global demand being about 7 billion cubic feet annually.

Read: Helium One Global uncovers promising helium results in Tai-3 well in Tanzania

However, geopolitical and logistical factors prevent the big producers from meet growing demand and Helium One’s discoveries in Tanzania could significantly alter the landscape.

“It's an emerging sector...there are a lot of new players and startup companies globally coming to explore for helium because demand is high and it’s in short supply and this, as a result, drives up prices,” Ms Blaisse said.

The current market price for helium is around $500 per 1,000 cubic feet (MCF), which is more than 100 times the price of hydrocarbon gas.

Why helium?

Helium is a unique and indispensable gas used in various high-tech and industrial applications.

Ms Blaisse said despite helium’s common association with party balloons, its primary uses extend far beyond that.

“It can’t be substituted by any other gas. It cannot be made artificially.  It can only be explored and found in the Earth's subsurface,” she added.

“The largest demand for helium is in the electronics industry. It's used in fibre-optics and the manufacture of semiconductors. Helium also plays a crucial role in the processing of chips used in artificial intelligence (AI), which is a rapidly growing sector.

“Another large growth factor, interestingly enough, is in space exploration. Helium is used in leak detection in spaceships and rockets. They physically cannot or will not launch any rocket or spaceship without using helium to detect any leaks.”

Helium also plays a key role in medical applications.

"We were recently contacted by a major hospital in Dar es Salaam, which asked when production will actually start and meet demand for helium for MRI scanners,” Ms Blaisse said.

Projects in Tanzania

Since its founding, Helium One has raised about $44 million for its three projects in Tanzania, with $10 million secured recently through a listing on the London Stock Exchange (LSE).

The Rukwa project is the company’s largest, hosting independently verified (SRK-2020) Best-Estimate Unrisked Prospective Recoverable Helium Resource (2U/P50) of 138Bcf, making this the largest known primary helium resource in the world.

According to Ms Blaisse, Helium One’s exploration efforts have yielded good results, particularly in the Rukwa Basin.

Late last year, the company initiated the second phase of drilling, resulting in the successful drilling of two wells – Tai 3 and Itumbula West-1.

“We successfully obtained the first downhole helium sample in Tanzania from the Tai 3 well, which was a huge milestone. We then went on to drill the second well, which is the Itumbula West 1 well, which is a completely separate prospect, about 20 kilometres east of the Tai prospect and that also encountered multiple helium shows in the subsurface,” Ms Blaisse said.

Overcoming challenges

Operating in Tanzania presents unique challenges, particularly with regard to infrastructure and logistics.

However, Helium One has made significant progress, adapting to local conditions and streamlining its operations to expedite the process.

“So, constraints are in terms of timing. That's all. You know, the same barriers—things just take time, right? If we were doing this project in North America, for example, you'd have a much more developed infrastructure. And you've got fulfilment of logistics, very accessible, lots of airports, etc. So it just takes time,” Ms Blaisse said.

“Ideally, you complete your exploration well, then go back and interpret the subsurface data sets, start planning your next state of the project, which we are doing. In the last few months, with changes in the board, we've accelerated the project substantially, drilling two wells in a matter of four months. This is a huge change in the company.”

Ms Blaisse also outlined the company's adaptive strategies.

“We've streamlined our approach to things. We're working with logistics companies who know the region better. We're using different ports to try and fast-track that process. It's just as good as we can. So I think it would be fair to say that there's already been a huge degree of success.”

Helium One’s success in Tanzania could have far-reaching implications for the global helium market. The high concentrations of helium discovered in their wells could help alleviate the current global shortage and drive down prices.

Additionally, the economic benefits for Tanzania are significant, with the potential for substantial government revenue from profits, taxes, and royalties.

"When we monetize this project and start producing helium, it will significantly feed the global demand. This will not only bring value to our company but also to Tanzania through government profits and other economic benefits,” Ms Blaisse said.

Strategic mineral

According to Minerals minister Anthony Mavunde, Tanzania considers helium a strategic resource along with lithium, graphite, nickel, cobalt, titanium, copper, aluminium and rare earth elements.

He told Parliament that critical and strategic minerals are those with high demand in economic development and national defence and are used in the production of scientific and technological equipment.

Read: Why Tanzania is wooing global mining giants

“Due to the importance of these minerals, the Ministry has planned to conduct research with the aim of identifying areas with strategic and critical minerals to encourage investment; to conduct market research on the demand for strategic and critical minerals to reach various markets worldwide,” he said.

Mr Mavunde also revealed government plans to attract investors in the exploration and mining of strategic and critical minerals by creating a conducive environment; issuing licences for exploration, mining and trade in strategic and critical minerals and completing the preparation of a strategic plan for the development and exploitation of strategic and critical minerals in the country.