Weil Group Canada says it has identified nearly two billion cubic feet of proven reserves of helium between its Saskatchewan and Alberta projects and is moving to commission a central helium liquefaction facility in southern Alberta within the next 20 months.
Weil envisions Medicine Hat becoming the country’s helium supply hub, said Jeff Vogt, Weil chief executive officer. He said its infrastructure, location on the TransCanada highway, labour pool and reliable power supply it an ideal site for liquid helium production.
“We have been in extensive discussions with Medicine Hat officials to locate our new CryoHub facility in the city, and to collaborate to develop helium resources in the region,” Vogt said in a company press release. No cost estimates were provided.
“The city last month announced that it is undertaking helium exploration as part of its recently expanded drilling program. Therefore, this proposed facility would be a central hub to receive helium production from projects in both Alberta and Saskatchewan for liquefaction,” added Vogt. Additional proven helium reserves nearby in Montana could also feed the facility.
'Significant step' for Medicine Hat
Medicine Hat immediately welcomed the initiative. “Thanks to our forward looking Growth Strategy, we were able to identify this opportunity and are pleased to support the Weil Group’s plans to invest in Medicine Hat,” Mayor Ted Clugston said in the press release.
“This is a significant step in the Medicine Hat story. It demonstrates once again the unique benefits of our location and our city’s ability to achieve economic diversification. Local business investment creates employment and future revenue for our city,” said Clugston.
Weil said it sees significant multi-bcf resource potential in Canada. “Given our history and knowledge of the area, we feel that Canada will become a world-class helium producer in just a few years,” said Vogt. Helium’s uses are expanding, serving unique high-tech applications in MRIs, fibre optics and semiconductor chip manufacturing, he added.
First of its kind helium plant
Weil’s Mankota, Saskatchewan plant, manufactured by Munich’s Linde Engineering Group, was the first of its kind in the world. The membrane – pressure swing adsorption plant for the production of Grade A pure helium has inlet feed capacity of 10 million cubic feet of gas per day.
Brought on production in mid-2016, the Mankota field produces from a deep, high-porosity/high-permeability Cambrian sandstone reservoir. There are two existing wells on the anticline and additional wells are planned in 2017/2018 to augment helium reserves and production.
While transport logistics limit the market for helium gas production, liquid helium is exported worldwide. Weil is looking to bring on stream another 200 million cubic feet of annual supply with export opportunities to the U.S., Asia and Europe.
Weil, a subsidiary of Weil Group Resources, LLC, headquartered in Richmond, Virginia, said it is currently shipping liquid helium to customers in Asia through its U.S. liquefier partner on the U.S. federal helium reserve administered Bureau of Land Management (BLM) pipeline – a first for an independent gas company.
Many Asian and U.S. companies are actively pursuing supply diversification to become less reliant on the major industrial gas companies. Unlike other world sources, Weil’s projects are exclusively a helium source–not a byproduct tied to LNG take-or-pay requirements, which offers customers greater flexibility, the company notes.
The City of Medicine Hat Natural Gas & Petroleum Resources Division (NGPR) Growth Strategy has included a component focused on the economic discovery and extraction of helium from the beginning, said NGPR general manager Brad Maynes.
“The processing and marketing of that helium has potential synergy with the Weil Group’s established production presence in Western Canada and the possible construction of an upgrading facility (Cryohub) within the City of Medicine Hat. We look to further that ambition over the next year,” Maynes said.