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When one thinks about drilling and mining in Saskatchewan, it’s likely about uranium, potash or oil, but global shortages have recently put the spotlight on the province’s helium industry.
Saskatchewan has “significant” underground reserves, according to the provincial government, and they’re secreted in a way that allows it to be captured in a more environmentally-friendly way.
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The province holds about three per cent of the world market currently, but the provincial government set a goal in 2021 to get it to ten per cent by 2030.
Shipping backups in the Strait of Hormuz, thanks to conflicts in the Middle East, have put a strain on world helium supplies, causing a shortage.
Helium is used for all kinds of medical, technical and manufacturing needs. Some medical imaging and microchip manufacturing can’t be done without it.
Paul Martin, a business analyst, said Saskatchewan can’t fill the 30 per cent gap being cause by the shipping problems, but the shortage may have increased the province’s chances of hitting its 10 per cent goal.
“With the disruption that we’ve seen in the middle east, clearly the world is going to be looking for diversification of their source of supply – they don’t want to be reliant on one supplier,” said Martin.
He said Saskatchewan is a new supplier that’s in a jurisdiction friendly to mining and is politically stable.
Martin explained the industry in Saskatchewan is still in early stages. Helium deposits have been known about in Saskatchewan for decades, but he said no one had been able to find a way to make it commercially viable.
“We appear to be on the stage to be able to do that now, so Saskatchewan has become a player and we have some small companies that have always believed in it and are now making some significant headway,” he said.
Chris Beaudry, Saskatchewan’s Energy and Resources Minister, said the helium shortage is a concern for the world, but agreed that it opens up an opportunity for companies in the province.
He believes Saskatchewan helium will be able to hit the government’s 10 per cent goal.
“With the aggressiveness that we’re seeing with some of our helium partners in their drilling programs that they have expected to do over the next few years, I believe that we will reach our goal,” said the Minister.
However, he said the taxation policy around helium is a hindrance. Beaudry explained that, unlike the other 33 of 34 critical ministers in Saskatchewan, helium isn’t able to access flow-through shares, which he said is a key tool for gaining investment.
He was in Ottawa last month with members from the helium industry to talk to government ministers, and Beaudry said he’s heard back, and believes a change in the tax rules will be coming this fall.
According to Beaudry, helium is going to become a bigger and bigger player in Saskatchewan, but the industry also needs a liquifaction facility. Currently, all helium taken out of the ground in the province has to be sent to the U.S. for processing.
The minister said he believes there will be a liquefaction facility in Saskatchewan.
