RE:RE:Does anyone understand the helium market DME is selling intoThere price assumptions must be from la la land or they know something the rest of world doesn't.
Most the helium sold in USA is 99.997% called grade A or Helium 4.7. Helium 99.999% is called helium grade 5. It has limited usage compared to the major sales product Grade A. I do not know the price for this product verses Grade A . In 2019, the estimated private price for Grade A was 210 /mcf with some getting higher prices. Goverment sales were all prices between 86-119 $/mcf depending if you were private or government for grade A helium.
Google helium prices and a pdf comes up that will give big surpise as to the actual market for helium. We export a lot and import too. A good price for helium you would sell might be up to 300 $/mcf which will drop quickly as we can import helium to soften prices in USA if they get high enough. I see no market for Grade 5 helium that would ever generate 50 million a quarter and have that much price differental.
To get 50 million a quarter lets use 300 $/mcf. We produce (50 million/300 mcf) 166,666 mcf or 1831 mcf per day or raw gas inlet of 26 million at 7%. That plant would be massive and have lots of storage tanks. Years to build and get firm deliveries for the helium. That would be 14 truck loads a day. Where is the market for that.
I have lot of trouble believing you could double the price from 4.7 to 5 helium, especially if you see the limited usuage volumes, but if you did you still would have now 7 trucks a day. If it was truly that kind of differential every plant in USA would be making helium 5 and there would be little or no differential. i read where Helium 5 will become standard grade as all new plants coming on our Helium 5 like ours will be. Any differential will disapper if everyone is putting in these 99.999% plants.
And of course if we deliver 1831 mcfd that could flood market also.