Saskatchewan will soon be home to the largest helium purification operation in Canada.
The new facility will be constructed by North American Helium Inc. (NAH) near Battle Creek in southwest Saskatchewan.
It is expected to be in-service by July 2021, with construction starting this October.
“Helium production in Saskatchewan is set to take off,” Energy and Resources Minister Bronwyn Eyre said. “The building of this purification facility by North American Helium will enable the province to scale helium production and important export capacity.
“In Saskatchewan’s Plan for Growth, we committed to developing this industry and have implemented strong policies to support new investment just like this.”
“We are fortunate to be operating in a jurisdiction with a supportive regulatory structure, favorable geology for helium production and a skilled workforce,” North American Helium's chairman and CEO Nicholas Snyder said.
“The government has shown a commitment to the development of this industry in Saskatchewan, which will contribute new production needed to replace depleting natural-gas-linked helium sources in North America. Our Battle Creek project demonstrates that reliable long-term production of helium can be created from non-hydrocarbon sources, which means a smaller environmental footprint while still benefiting from the expertise developed in Saskatchewan's oil service industry.”
“This project will bring new jobs and economic growth to the southwest region, a part of Saskatchewan that prides itself on resource development and economic growth,” Cypress Hills MLA and legislative secretary for Energy and Resources Doug Steele said. “The construction of this plant in the Battle Creek area signals the world-class investment climate Saskatchewan offers and we acknowledge North American Helium for their significant work in the region.”
Recent regulatory amendments introduced an expanded provincial sales tax exemption for exploratory and downhole drilling activity, which includes drilling for helium. Saskatchewan has a 4.25 per cent royalty rate for helium. In addition, the NAH helium project has been conditionally approved by the Ministry of Energy and Resources for the Oil and Gas Processing Investment Incentive, which provides new or expanded helium processing and liquefaction facilities with a 15 per cent transferrable royalty credit based on capital expenditures.
The North American Helium project has also been approved through the environmental assessment process.
Canada has the fifth-largest helium resources in the world, with significant underground reserves in Saskatchewan. Global demand for helium is increasing, as a global supply shortage has resulted in helium prices rising more than 160 per cent since 2017. Over the last five years, just under 20 wells have been drilled in Saskatchewan (the vast majority of which were in southwest Saskatchewan), specifically targeting helium.
The Saskatchewan Geological Survey continues to analyze around 88,000 oil and gas wells across the southern half of the province to determine how many have a helium occurrence of greater than one per cent, which is a good indicator of viability.
Helium is used in various applications, including medical research and diagnostic testing, digital technologies, semiconductors, fibre optics, nuclear power facilities, rocket systems, welding and balloons.