Bloomberg
Businessweek
/
SEPTEMBER
2,
2019
THE
ELEMENTS
15I
f JoshBluettandhispalThomasAbraham-Jameshadn’t
runoutofthingstotalkaboutduringa roadtrip,they
mightneverhavereadthesixpagesthatchangedtheir
lives.BluettandAbraham-JamesareAustraliangeologistsand
onetimehousematesinBrisbanewho’dbeenhuntingprecious
metalsandfossilfuelsforminingandenergycompanies.By
November2013,Abraham-JameswaslivinginTanzania,look-
ingforgoldandcopper,andheinvitedBluettfora visit.“Iwas
havinga greattime—thiswasproperexploration,”Abraham-
Jamesrecalls.“Itoldhim,‘You’vegottocomeexperience
thisplace.’”
DuringthelongdrivefromthecityofDaresSalaamtoone
ofthesiteswhereAbraham-James’scompanywasprospect-
ingforgold,Bluettfoundinthebackofthecara government-
publishedbook,IndustrialMineralsinTanzania:AnInvestor’s
Guide. Insideweresummariesofoldreportsidentifyingdepos-
itsaroundthecountry,andsomenumbersconcerninghelium
caughtBluett’seye.Whileconductinggeologicalanalysesfor
hisemployera coupleofyearsearlier,he’dgainedsomeexpe-
riencespottingcachesoftheuniverse’ssecond-mostabundant
element,whichhaslatelybeeninshortsupplyhereonEarth.
Mostofhumankind’sheliumcomesfromtheU.S.and
Qatar,andtechnicalorpoliticalfactorscanseverelycon-
strictthemarketalmostovernight.Acolorless,odorless
gas,it canbefoundtrappedinliquidformingroundwater,
brine,andlakes;inmineralores,coalformations,andfields
ofnaturalgas;andinsedimentsofthetropicaloceansor
sheetsofice.Butit’ssolightthatit’selusive.If nottightly
contained,it escapesnotonlyitscontainerbutalsoEarth’s
atmosphere.Recyclingis possiblebutdifficult.Forallintents
andpurposes,heliumis a nonrenewableresource,onethat’s
growingsteadilymorevaluabletoallkindsofengineersand
researchscientists.Andnoonehadeverextractedhelium
foritsownsake.
Ina typicalminewhereit canbeprofitablyseparatedfrom
themethaneandothergasesit’sboundupwith,heliumcon-
centrationstandsatabout2%.AccordingtotheInvestor’s
Guide, thehotspringsinsouthwesternTanzaniawerespit-
tingoutgaswith5%to15%heliuminit.“Ithoughtsomeone
wroteit downwrong,”Bluettsays,“thatthedecimalwasin
thewrongspotorsomething.”If thenumberswereright,he
andhisformerhousematehadstumbledontosomethingbet-
terthana goldmine.
“Atthatpointwesaid,‘Let’sforgetaboutthegoldandgo
totheGeologicalSurveyinthecapitalandfindtheoriginal
reports,’” Abraham-James says. In one of the low buildings in
Dodoma, behind a chain-link fence topped with barbed wire,
they dusted off a 1956 paper by British geologist T.C. James.
He’d analyzed gases naturally occurring around Tanzania,
then a British territory known as Tanganyika, and found
helium concentrations in the country’s hot springs as high
as 17.9%.
Soon after, Abraham-James pitched his employer on a play
for Tanzanian helium. The company declined; its focus was on
metals. Abraham-James and Bluett quit their jobs.T
he U.S. government started to develop a huge store of
helium at a processing plant in Texas about a century
ago. The feds were hoping to use it in zeppelin-styleairships, which were seen as the future of transportation
until the Hindenburg scattered that idea into a million burn-
ing pieces over New Jersey in 1937. The space program later
becamethejustificationforthereserve,butin1996,Congress,
initsinfinitewisdom,decidedthegovernmentoughttogetout
oftheheliumbusiness. It ordered the Texas facility’s opera-
tor, the U.S. Bureau of Land Management, or BLM, to sell off
much of the gas by 2015, with the idea that private industry
would make up the difference by then.
Thatlastpartdidn’thappen,sotherewaslittletohelp
heliumheadswhentheBLM,whichhadlongchargedbelow-
market rates, started bumping up the price as mandated by
the 1996 legislation.Theincreaseswereunpredictable,accord-
ingto 2012 SenatetestimonyfromDavidJoyner,presidentof
refiner-retailer Air Liquide Helium America Inc. The agency
alsostartedtackingonfees.
Amongthekeyusesforheliumtodayarearcwelding,
chromatography, medical lasers, optical fiber, intercontinental
ballistic missiles, and space travel. The Large Hadron Collider,
the particle accelerator outside Geneva wrestling with the big-
gest questions of physics, needs 120 metric tons of helium a
weektokeeprunning.Becauseheliumis superconductive,
meaningit cantransmitelectricitybasicallyforever,it’sideal
forsemiconductor manufacturing. Every MRI machine in the
world bathes its magnetic coils in liquid helium to prevent
overheating. This is possible because helium boils—that is,
turns into a gas—at a lower temperature than any other ele-
ment: –452.1F. Liquid helium is so cold, it’s the first choice
when researchers want to chill something at the South Pole.
All the bulk liquid helium we know about comes from only
14 plants in six countries. A little more than half is produced
in the U.S., and about a third in Qatar. For an example of the
price spikes the BLM sale foretold, look to June 2017, when
Saudi Arabia and the United Arab Emirates initiated a block-
ade on exports from Qatar and its helium vanished from the
market. The BLM initiated rationing. Then, last August, it held
its final helium auction, and refiner-retailer Air Products &
Chemicals Inc. outbid everyone to acquire 100% of the helium
offered. The following month, Exxon Mobil Corp.’s helium
plant in Wyoming shut down for unplanned maintenance. Like
the price of lithium, the price of helium is one of the more
opaque among commodities, but reports said it jumped 135%
from the previous year. With such extreme sensitivity in this
market, a big new helium source could, just maybe, transform
a whole country’s economy. A country such as, say, Tanzania.
Even when the cost of helium shoots up, natural gas com-
panies aren’t going to increase production simply so they can
make a higher profit on the trace amounts of their product
that are helium. “You’re held captive to the main product,”
says Maura Garvey, director of market research for Intelligas
Consulting in Dedham, Mass. If you’re a large manufacturer
with wide margins or a government space program, you can
absorb the cost increase. But some customers have been told
theywon’tbegettingthefullamounttheycontractedforor
thatthey’regoingtohavetopaymore.
Forthethousandsofacademicresearchgroupsusingliquid
helium in their experiments or instruments, or a hospital run-
ning a few MRI machines, the price spike or supply cutoff pres-
ents an obstacle to your operation. And if you’re the King