US Investor Opportunity As Helium Supply Threatened By Qatar Crisis

In June, 2017 a group of Middle East countries led by Saudi Arabia recently united to sever diplomatic relations and initiate a blockage of their neighbor Qatar for allegedly enabling the funding and growth of terrorist groups. The impact of the blockage and closing of export routes previously available to Qatar had an sudden impact on its ability to export 32% of the global supply of helium. This created an immediate threat to the supply chain, manufacturing and innovations in electronicstechnologyinternet accessmedical and military industries who all require a steady supply of helium.

“While there was already a need for expanded helium exploration and production in the US to meet the growth in global demand, the geopolitical climate in the Middle East has amplified the opportunity for investors,” explains Lucas Kalisher, CEO of Summit Source Funding a private equity firm that specializes in private investor funded Helium exploration and production projects in the United States.

qatar helium crisis

In July, Qatar was able to get back online with producing helium but the crisis and challenges are far from over.

“The thing this really highlights,” says  Phil Kornbluth, head of U.S.-based industry consultancy Kornbluth Helium Consulting, “is that the helium supply chain, even though there’s ample supply when everything is running, is inflexible and fragile.” The challenges of handling liquid helium and the fact that it’s only made as byproduct of natural gas in a few places around the world all make helium a tricky product to source. Qatar is producing helium again, but the political crisis is not over. It’s been a wake-up call,” reports The Atlantic.

Qatar is the second largest producer of helium and the boycott by the Arab neighbors forced it to close its two helium production plants. “Helium is the single commodity that is affected most by this blockade because it’s probably the only thing where Qatar is a major world producer and the supply has been completely cut off,” Kornbluth told Reuters.

Scientist Fear Helium Shortage will Impact Research and Medical Manufacturing

Nature.com reports that, “Scientists fear they may be forced to halt experiments or shutdown laboratory instruments because the ongoing blockade of Qatar is threatening their helium supplies. The Gulf state supplies hospitals and laboratories around the world, but had to close its two helium plants.”

Helium Shortage Has Global Impact and Creates US Opportunity

Prior to the Arab blockade, helium supply was already at risk. “And, although the world’s helium reserves have not been depleted, it is a nonrenewable resource. When it’s gone, it’s gone. That’s true of many substances, but with helium, things are different. There is no known substance that can replace it,” writes Dr. Don Lincoln,  senior physicist at Fermilab and CNN contributor.

On its website, Qatar’s Rasgas company succinctly explains the importance of Qatari helium to Asia: “Since 2000, world demand for helium has increased by approximately 20 percent. Future growth in helium consumption is expected to be driven by demand from electronics manufacturers in Japan, China, Republic of Korea, and Taiwan.”

According to Reuters reporting on the helium shortage, “Demand for the gas, driven particularly by Asia’s booming manufacturing industry, is on the rise. U.S. reserves meanwhile are dwindling due to the lack of helium production from its oil and gas fields, and the country has already had to start importing helium from Qatar.” With that supply cut off, Asian countries and its suppliers of helium are now looking to the US to meet the demand. This could have significant implications if helium prices rises and increase opportunities in the US.

Also according to Reuters, “Japan’s Iwatani, which is a major supplier of helium to China and Southeast Asia, ‘said it had a month’s supply in stock’.  German industrial gases company Linde said it was working on meeting customers’ requirements via helium in the United States as well as some smaller exporting countries.”

Even before Qatar’s move to shut down helium supplies, global demand for the gas was growing at 2 percent a year.

What the Helium Shortage Means for US Investors

In the near and long term it could well mean countries around the world and, in Asia in particular, will be sourcing their helium supply elsewhere. The quest for alternative helium suppliers could benefit the United States and those who invest directly in helium production.

“Going forward, helium users should pay increased attention to the make-up of the supply portfolio of its suppliers,” wrote Kornbluth (Gasworld US Edition, August, 2017).

The good news for investors is that companies like Summit Source Funding in Colorado are leading the way in the discovery of new helium exploration and production opportunities. Private investment in these projects could mean significant gains for investors. Increased demand, political instabilities in foreign helium producing countries and decreased supply, could mean great opportunity for investors that qualified to invest in helium exploration and production projects.

“Summit Source Funding has secured significant opportunities to extract helium that could benefit private investors. We have wells and acreage with some of the highest concentrations of helium in North America.  We expecting to have production facilities coming online by the end of 2017,  just in time to support the increased global demand on US produced helium.  Even as supply increases, the opportunity for investors will remain. Helium is a limited resource with no alternative to support the supply chain of so many diverse industries,” said Kalisher.

For More Information Contact:

Jeff Ragsdale
Executive Director of Business Operations/Director of Investor Relations

Summit Source Funding
2760 29th Street, Suite 2A
Boulder, Colorado 80301
Office: (800) 928-6964
Fax: (720) 465-6533

Email: Info@SummitSourceFunding.com

Helium Investing and BREXIT Influenced Volatility in the Stock Market

While the world has to wait to learn the long term impact of England’s BREXIT vote to leave the European Union, one thing that is for sure is the devastating short term impact and volatility in the Stock Market of that decision. “The outcome sent global markets into a tailspin.” There might be several years of instability as a result of this major shift in global finances. In the meantime, expect a bumpy ride in the stock market.

Smart investors are looking to smooth out that ride and BREXIT proofing their investments by protecting their capital and diversifying their portfolio with safe havens such as Helium, Gold and other natural resources.

Clearly, now is the time to consider diversification in safe haven investments like direct participation in Helium exploration and production. A direct investments in Helium production and exploration is not susceptible to the risk of big drops in the market because Helium’s demand is high, supply is limited and prices are fixed by contracts.

A safe haven is an investment that is expected to keep its value or even increase its value in times of stock market volatility. The goal of a safe haven is to limit an investor’s exposure to losses in the event of market downturns.

Stock Market Volatility

Following the announcement of the BREXIT vote, the Dow Jones plummeted 610 points (it’s 8th biggest drop), or about 3.4%, on Friday, June 24. Likewise global stock, currency and other markets had a severe adverse reaction in response to Britain’s surprising vote to leave the European Union.

“Many investors are worried about the next big one, the next major global recession and 50% decline in the market like we saw in ‘08 and ‘09, and I don’t think this is it,” said Jeff Kleintop, chief global investment strategist at Charles Schwab. “I think this is more akin to some of the shocks we’ve seen over the past five years.” While BREXIT may not be the impending “Big One” it’s an example of how the unstable global economy is creating volatility in the Stock Market and supports why smart investors are looking to protect and diversify their portfolios in safe havens.

Helium is a Smart Investor’s Safe Haven

Helium is essential in the supply chain of medical, technology, military, space exploration industries and demand for Helium is at an all-time high.

Helium Demand Chart

Helium Demand

While demand is high and is projected to grow, Helium is a limited resource with supply dropping.

helium supply chart

Helium Supply

This supply and demand relationship coupled with Helium prices locked in by contracts means the potential for significant returns for qualified investors.

An additional benefit of investing in Helium are the tax deductions for accredited investors with direct participation in Helium exploration and production.

How to Directly Invest in Helium Exploration and Production

With volatility on the rise, uncertainty domestically and overseas and concerns around the presidential elections in the US, now is the time to consider diversification in stable “safe haven”  investments like direct participation in Helium exploration and production.
Accredited investors may qualify to invest in independent Helium exploration and production projects. To learn more contact Summit Source Funding LLC at (800) 928-6994.

Helium is a Critical Part of the Electronics Supply Chain

Experts in the electronics industry know that helium is a critical part of making the components that bring us the internet, smartphones, home healthcare, and almost any of the modern electronic technology conveniences that we take for granted today.

The Electronics Supply Chain

There was $1.42 trillion (yes trillion) worth of electronic systems manufactured in 2015.  This includes the gadgets that consumer use constantly – smartphones, tablets, PCs – as well as industrial, medical, automotive, and defense electronics.  This represents a wide range of applications, but at the heart of all of them are semiconductor chips.

If you take apart any gadget, you will find thin rectangular items that measure a fraction of an inch on each side.  These are the semiconductor chips that do the computing, storage, and communication functions that all of these products need.  The vast majority of these are made with silicon, the most common semiconductor material, with properties ideally suited to these functions.  To be able to do that, though, silicon needs to go through extensive processing to create the specific circuitry for each chip.  This is where helium comes in.

Helium in the Semiconductor Manufacturing Process

The processing of silicon into functioning chips is done in a fabrication facility (“fab”) with expensive equipment and ultra-clean conditions.  Modern fabs cost billions of dollars, and each of the many pieces of equipment costs millions, so it is important to have the processing running efficiently to make use of that investment.  Helium serves multiple functions in these processes.

Helium has several properties that are leveraged in the semiconductor manufacturing process.  Most importantly, it is an “inert” gas, meaning that it does not react with other elements.  This makes it ideal as the environment for the chemical reactions that take place during the processing.  Many of these are gas- or liquid-based, so having an inert gas around the silicon prevents any unwanted reactions.

Helium also has a high thermal conductivity, meaning that it conducts heat away effectively.  This helps to control the temperature of the silicon during these processes.  This is increasingly important as the dimensions of the circuitry on the silicon continue to shrink.  It would be impossible to drive this miniaturization without the process control that helium provides.

Finally, helium is used because of its cooling properties.  It is a liquid at extremely low temperatures, which allows it to cool magnets to a temperature that optimizes their properties.  The magnets are used in some types of semiconductor equipment, as well as magnetic resonance imaging (MRI) systems and other medical applications.

Helium and The Bottom Line

The semiconductor industry generated $353B of revenue in 2015, with 787 billion units shipped.  Microprocessors – the main semiconductor device for computing – represented $60B, and memory chips — which store your music and run your games — were $72B.  All of this represents an enormous investment by some of the biggest companies in the world, and all of it hinges on materials such as Helium.  With the ever-growing demand for electronic devices, any critical piece of the supply chain can represent an excellent opportunity for investors.

Helium Uses in Technology

Without helium, advances in cutting-edge technology fundamental for supporting the development of medical, manufacturing, astronomical and computer devices would never materialize. Helium is one of our most valuable resources and essential for solidifying the technology supply chain.

An inert gaseous element found in radioactive ores and natural gas, helium is so light that the Earth’s gravity can’t prevent it from escaping the planet. Obtained from ground sources, commercially produced helium mingles with natural gas in a way that makes extraction manageable and economical. Helium removed from natural gas forms from the radioactive decay produced by thorium and uranium in granitoid rocks.

How is Helium Used in Modern Technology?

In addition to fiber optics manufacturing, gas chromatography and cryogenics, helium can be found in:

MRI Machines

Because helium has such a low boiling point, it offers excellent cooling properties for superconducting magnets needed to operate MRI machines. When cooled to around -450°F, helium transforms magnets into superconductors for operating scanners and creating stronger magnetic fields. The more powerful a magnetic field is, the clearer the details are in MRI scans. Using helium in high temperature situations such as cooling magnets is called “heat transfer”. Our world utilizes nearly 10 percent of helium supplies for various heat transfer operations.

Computer Hard Drives

Hard drives sealed in helium atmospheres reduce interior air turbulence to facilitate drive spin , emit less heat, save on power consumption and increase drive capacity. Helium used in hard drives can expand storage capacity of drives by as much as 50 percent. Reduced turbulence within hard drives and computers also means much less friction occurs, which allows hard drives to run at cooler temperatures to avoid overheating. Because they are tightly sealed, helium-supported hard drives stop contaminants (dust, moisture) from infiltrating the drive and causing premature failures.

Inner Atmosphere Operations

Pressure purging operations rely on helium where a certain gas is under pressure and needs replaced by helium according to how much of the pressured gas is consumed. The aerospace industry and NASA used enormous amounts of helium gas when they developed Delta IV rockets. Needed to preserve pressure levels in liquid oxygen fuel tanks, helium also prevented these fuel tanks from collapsing as liquid oxygen burned to fuel the rocket.

Heat Transfer Mechanism in New Generation Nuclear Reactors

An extremely efficient heat transfer gas, helium offers high thermal conductivity, is anti-corrosive and radiologically inert. In addition, helium will not impact the neutron multiplication factor nor alter aggregate state, allowing nuclear plants utilizing helium as their primary heat transfer medium to exhibit elevated operating temperatures for significantly improved efficiency and safety.

Industrial and Biomedical Lasers

Applied in helium-neon, CO2 and metal-vapor lasers, helium is needed for excitation in lasers designed for use in scientific research, spectroscopy, laser eye surgery, interferometry and holography. Helium-neon lasers exhibit exceptional Gaussian beam qualities that are unrivaled by other laser types and allow physicians to perform complex surgeries without risk to patients.

The Ultimate Use of Helium–the Hadron Collider

Without helium, the Large Hadron Collider could not operate its huge ring of superconducting magnets necessary for performing fantastic particle accelerations. According to the LHC’s official website, “superconducting magnets need chilled to a temperature even colder than space (‑271.3°C), which necessitates connection of the accelerator to a liquid helium distribution system”.

It’s hard to imagine a modern or future world without helium!

Helium Used for Internet Access (Fiber Optics)

Most people are unaware that helium is vital to technology, including the very Internet access people use to read this article.

Helium is Fantastic at Cooling

One of the main functions helium provides is being able to cool things down quickly.  In fact, the United States Geological Survey (USGS) claims that 32 percent of helium usage is for cryogenic (freezing) applications. Many technologies need this ability to cool down in order to work properly. Technology which provides Internet access requires helium for cryogenic applications.  This includes:

  • Fiber optics manufacturing — helium is used to cool down fiber optics which goes into cables for data transfer. Fiber optics require an all-helium environment to prevent air bubbles from being trapped in the delicate fibers. Fiber optics are fragile and can break, which is why using helium is vital to the process. Using other methods of cooling would possibly contaminate the fibers, making them unusuable.
  • Semiconductor cooling — helium is used to transfer heat away from semiconductors (computer chips) when manufactured. Helium is also used to cool the magnets used in manufacturing the semiconductors. The helium actually transform the magnet into a superconductor, thus making it even more powerful.

Controlling the atmosphere in the manufacturing process and experiments is vitally important, so much so that companies use 18 percent of the annual helium usage to provide that controlled environment. Like the requirement to use helium during fiber optics manufacturing to prevent air bubbles, helium provides a safe and inert way to control the environment in manufacturing and testing different computer components.

How We Use Fiber Optics

Fiber optics is essential for today’s Internet. About 25 percent of today’s Internet is made up of fiber optics and that number is expected to increase as more carriers switch over to the ultra fast fiber optic cables. Unlike copper based technologies such as DSL and broadband cable, fiber optic isn’t limited by electricity and resistance. It works by transmitting data in the form of light, thus giving amazing speeds such as 1 gigabit per second throughput.

Helium is in Demand

People are taught that helium is the second element in the periodic table in their high school chemistry class, but not much in terms of applications.  Other than party balloons and speaking with a squeaky voice when inhaling it, most people don’t pay much attention to helium, even though without it, the world would look very different today.  Helium is vitally important because it is a nonrenewable resource that is extracted from natural gas.  What’s more, in 2015 the world’s demand for helium continues to increase. In 2015 it’s estimated that companies extracted about $900 million dollars worth of helium in the United States alone. During that year, it’s estimated that the world used 1.5 billion cubic feet of helium.

Helium is vitally important for today’s technology, including Internet access. Without helium, people would not have the same level of technology they enjoy today.

Helium Uses in the US Military and US Defense

Helium has a number of US Defense uses and is an extremely important to the US Military.

Defense use falls into two types, indirect and direct.  Indirect usage by the military is often direct usage by other groups.  One example is weather monitoring, which is necessary for a number of military operations even when it is not the specific mission of a military group.

One of the most important direct uses of helium by the US Military represents about a fifth of yearly consumption in this country.  Both NASA and US Defense agencies need helium to operate heat-guided missiles and rockets.  It remains the only gas that can purge and pressurize the propulsion systems and tanks of rockets that rely on liquid hydrogen and oxygen as fuel.  The use of an incompatible gas could cause engines to become nonfunctional.

Helium also has a critical role in surveillance within combat areas.  Ground troops rely on helium to cool some types of thermographic cameras and other equipment.  The Army in particular considers a supply of helium critical to its cryogenic research.  Some of its detectors require liquid helium.  Navy submarine detectors use helium to eradicate noisy signals.

The events of 9-11 caused US Defense organizations to increase surveillance efforts.  Surveillance systems based on operating balloons and dirigibles require ready access to helium.

Attributes of Helium

Helium is the most abundant in the universe and also the second lightest.  Scientists believe helium was a byproduct of the Big Bang.  On Earth, the radioactive decay of heavier elements creates helium.

Helium has quite a few special attributes that make it very valuable for military and commercial use.  Among the elements, it is the most stable.  It neither burns nor reacts with any of the other elements.  It remains a gas except in unusual conditions.  Only under extreme conditions is it even possible to concoct any of the small number of helium compounds.  However, unlike other materials that become solid when exposed to temperatures near absolute zero, helium remains a fluid.

The diversity of this element lies in its unique chemical and physical characteristics.  The two most outstanding are its low atomic mass and a stable electronic configuration.

Limited Helium Supply

Helium a non-renewable natural resource.  The most common way to recover helium is from deposits of natural gas.  The richest helium areas in the US produce commercially feasible sources of natural gas that typically have higher concentrations of helium than those linked to international sources.

The Bureau of Land Management (BLM) was tasked with operating and maintaining the Federal Helium Program (FHP).  BLM staff in Amarillo, Texas operate and maintain the only federal storage reservoir, plant, and pipeline.  The program supplies approximately 42 percent of US helium and 35 percent of the worldwide supply.

When the initial FHP ended, Congress passed the Helium Stewardship Act of 2013.  This legislation continues FHP provisions until the end of fiscal year 2020.

Helium remains a vital resource in the US Defense and US Military supply chain.  Supply limitations are strong indicators of rising helium prices on the horizon.

How Helium is Used with MRI Machines

Helium is an element in the noble gas category that serves many purposes in various industries including the medical field. In fact, one of the most common uses of helium is in MRI machines.

What Is an MRI Machine

A magnetic resonance imaging, more commonly known as an MRI, machine is a device that uses a combination of radio waves and a magnetic field to view internal images of the body. The magnetic field and radio waves create detailed images of different organs and tissue. It’s a noninvasive procedure used to produce high-resolution imagery for diagnostic purposes, in particular of the tissue, organs and skeleton. MRI machines assist physicians in determining the origin of a seizure, the presence of a tumor or the damage done by a heart attack, just to name a few instances.

How Does An MRI Machine Work

A majority of MRI machines used consist of a large, tube-shaped magnet, which patients must lay down in on a moveable table. While inside of the machine, the magnetic field alters the alignment of the hydrogen atoms inside the body. Radio waves then stimulate the atoms to create signals that produce an image. They create cross-sectional images. They’re even capable of producing 3-D images and allow medical professionals to view the image at various angles.

How Does An MRI Machine Use Helium 

An MRI machine contains coils, a magnet and wires that conduct current. The machine uses a great deal of energy because of its large magnetic field. In order for it to use that much energy, it must be super conductive. For this to occur, wires inside the machine need to be reduced to a temperature of near zero degrees. The machine requires a substance in order for it to maintain a cold temperature, and that substance is liquid helium. The wires continuously are doused with liquid helium. The fluid has a temperature of -269.1 degrees Celsius, which is the equivalent of -452.11 Fahrenheit. The average MRI machine utilizes 1,700 liters of helium. A standard 18″ balloon requires about .1 oz of helium, and the machine uses about 56,100 oz to give you a mental picture of how much helium that is. The amount of helium in the scanner must be topped off on a regular basis, which increases the amount of helium used by the machine even further.

Unfortunately, the amount of helium on earth is diminishing due to its heavy usage, and it floating away. There isn’t much of it on earth because it’s not weighed down to the atmosphere. It’s slowly, but continuously, floating off into space. The noble gas is unable to be synthesized and is usually made through natural radioactive decay. Once the helium is gone, it’s gone forever because it’s a nonrenewable resource. The medical field requires a large quantity of helium to assist patients with diagnosing and monitoring their condition, which is by far a vital and valued use.