Home / Business and Economy / Helium Surprise: US Firm Lands Big Contract
Helium Surprise: US Firm Lands Big Contract
28 Apr
Summary
- Global helium flows are being rewired due to Middle East tensions.
- US Energy Corp. signed a five-year helium offtake agreement.
- The deal secures 100% of Phase 1 production at Montana's Big Sky Hub.
Global energy supply chains are undergoing significant rewiring amid ongoing tensions in the Middle East, with the Hormuz chokepoint remaining closed. These disruptions are exposing vulnerabilities, particularly in the helium market, impacting industries from semiconductor production to medical imaging.
In response, U.S. Energy Corp. has announced a significant milestone: a five-year helium offtake agreement for its Big Sky Carbon Hub in Montana. This contract with an investment-grade global industrial gas company covers 100% of Phase 1 helium production, estimated at up to 1.2 million cubic feet per month.
The agreement, structured under a take-or-pay basis, fixes helium pricing at $285 per MCF. This secures a vital long-term revenue stream, de-risking Phase 1 commercial operations targeted for early next year and validating years of development work for the company.
This development positions U.S. Energy Corp. as a notable domestic helium supplier, especially as the market seeks alternatives amidst supply shocks. The company's shares saw a substantial surge following the announcement, reflecting market confidence in its role.
