Update on Exciting Helium Development Near Shelby, Montana
This past May I was in Shelby, Montana ahead of the big centennial celebration of the Dempsey-Gibbons match. That's when I told you about the helium deposits near Shelby and "the new gold rush" garnering excitement in North Central Montana.
We got an update on Wednesday from Shelby's own Mac McDermott, who also happens to be the outgoing President of the Montana Petroleum Association.
McDermott: They delivered the pipe for the pipeline from their two wells that will transport the helium and nitrogen to their plant that they're going to build. Our local electric cooperative, Marias River Electric's busy working on upgrading the substation at Whitlash and some poles and lines.- so we'll have the electricity to run the plant, or Avanti Energy will. So it's exciting, these rural communities and towns as energy has kind of faced some challenges- it's kind of nice to see another industry come up. They look for it the same way we look for oil and natural gas, but helium is clean and green and the world kind of looks down on the energy that we provide. But it's done the same way- drilling rigs and pipelines.
We caught up with Shelby Mayor Gary McDermott and longtime Shelby attorney Don Lee who both have extensive experience in the oil and gas industry.
Don Lee told us that helium will be "the new Gold Rush" for Shelby and Toole County.
Don Lee: Well, some people call it the new gold rush, because worldwide- short supply. Right after World War I, the federal government nationalized helium. And they had a large helium reserve out of Amarillo, Texas. About 6,7, 10 years ago they realized that helium reserve was being depleted and they decided to have an open auction and they did...to make a long story short, helium is the second most abundant element in the universe. It's short supply. It's hard to find. Yes, there are three companies now that are actively exploring for helium and Toole and Liberty Counties.
How is helium captured and distributed similarly or differently than oil and gas?
Don Lee: You drill for it just like you drill for oil and gas, except you drill deeper. You drill to the basement. You drill to the granite. Because helium is decomposed uranium and thorium that comes from the granite, from the crust of the earth.
How profitable could helium be for Montana's Golden Triangle?
Don Lee: Give you an example of what it's worth. Let's say that natural gas is going, combustible natural gas- methane- that you burn in your furnace, goes for we'll say $2.15 cents per 1000 cubic feet. Refined helium will go anywhere from $600 to $1,000 an Mcf, per thousand cubic feet. That's why they call it the new Gold Rush.
Don Lee also tells us that they are working on building a helium plant in the area. He says it is about a $25 million expenditure, and he hopes they will be up and running in about 8-10 months. "They put in a helium recovery unit. They'll put it up on site out of Whitlash."
Full audio of Wednesday's chat with Mac McDermott. Mac also gave us the latest news on the oil and gas front from the Montana Petroleum Association annual meeting as well: