Strategic helium deposit discovered.

CNN quoted Stefano Marani, CEO of the startup Renergen, as saying that in 2013 his company paid only $1 for the right to explore and exploit a 187,000-hectare plot of land near Virginia in the Free State province of South Africa. When analyzing the composition of gas extracted from two previously installed exploratory boreholes, Renergen unexpectedly discovered unusually high levels of helium.

Renergen holds the exploration and production rights for 187,000 hectares of gas well area at a price of $1.

High-purity helium mine

Liquid helium is a crucial coolant in the manufacturing of microchips and in the operation of magnetic resonance imaging (MRI) scanners. However, global helium prices are volatile due to unstable supply. Currently, fewer than 10 countries in the world produce helium.

Renergen has undoubtedly struck gold. The company now controls over 200 million cubic meters of helium reserves ^under the Virginia Gas Project, valued at over $4 billion and with the potential to increase to $12 billion with expansion. By January 2023, the South African company had successfully produced its first batch of liquid helium from the project.

Nick Mitchell, Director of Operations at Renergen, said what makes the field's natural gas reserves so special is the unusually high concentration of helium. According to him, the average helium content in the field is 3%, with some areas reaching 12%. For comparison, the world's largest helium supplier, the United States, has an average content of only 0.35%, while Qatar has a mere 0.04%, according to the U.S. Bureau of Land Management.

This anomaly helps the South African company produce helium in an environmentally friendly way, according to CNN, citing Professor Chris Ballentine, Head of Geochemistry at the University of Oxford (UK). Professor Ballentine explained that under normal conditions, helium is merely a byproduct of liquefied natural gas (LNG). Helium can only be extracted independently and economically if its content is around 0.3%. The higher the content, the lower the carbon footprint, and the lower the extraction costs.

"We just need to drill shallow wells, perhaps 300-450 meters deep, at low cost, with a limited carbon footprint, and the helium will flow out of the well naturally," according to the CEO of Marani.

Commercial helium mine

In the context of frequent disruptions to global helium supply, finding new, high-purity, and abundant reserves of the gas is extremely important. "We are in a supply crisis, as the world only has a limited number of places that can supply it," said the CEO of Marani.

Prior to the discovery of the deposit in South Africa, the African continent had no helium producers. Tanzania has discovered several helium-rich gas fields, but has not yet moved to commercial production. According to Director Mitchell, the company is in phase one of a small-scale pilot project funded by the US government , expected to produce around 350 kg of helium per day, enough to meet the needs of all of Africa.

After numerous delays in 2023, Renergen hopes to begin commercial operations in February 2024, extracting helium alongside natural gas, followed by processing and distributing it to customers. Phase two, expected to begin in 2027 with funding from the US government and Standard Bank, is projected to have a production capacity of 412 tonnes per day, meeting 6-8% of global helium supply.

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