Helium’s Critical Role in Tech & Space: Why Prices Are Soaring Amid Supply Shortages in 2025

• Supply chain challenges and geopolitical tensions are creating significant market pressures, with current production concentrated among just a few countries including the United States, Qatar, and Russia.
• Helium prices have experienced extraordinary growth, increasing by over 400% in recent years, while 2023 U.S. sales reached 2.8 billion cubic feet valued at approximately $1.1 billion.
• Leading helium companies including Pulsar Helium, Georgina Energy, First Helium, Helium One, and Blue Star Helium are advancing projects across multiple jurisdictions with concentrations ranging from 2% to 14.5%, targeting near-term production.
• Major economies including the United States, European Union, and China have designated helium as a critical material due to supply shortage risks and its irreplaceable role in semiconductor manufacturing, medical imaging, and aerospace applications.

According to a Reuters reporting, the global demand for helium is likely to nearly double by 2035, backed mostly by a rise in demand from the semiconductor industry due to the lack of viable alternatives. The semiconductor industry's expansion, particularly in AI applications, is driving substantial helium demand growth. As reported by IDTechEx, global demand could exceed 322 million cubic meters by 2035 for the gas used widely in manufacturing due to its cooling and inert properties

Market Dynamics and Growth Drivers

Critical Applications

Helium's unique properties make it irreplaceable in several high-value industries:

• Semiconductor Manufacturing: Essential for cooling and providing inert environments
• Medical Imaging: Critical for MRI machine operation
• Space Exploration: Used in rocket fuel systems and pressurization
• Research Facilities: Required for particle accelerators and advanced research
• Data Storage: Utilized in helium-filled hard drives for improved efficiency

Supply Constraints and Market Structure

Extracting helium is by no means a simple task. Helium is most often found in natural gas fields and requires sophisticated, capital-intensive extraction and purification processes. A typical concentration of helium found within natural gas is in the range of about 0.01% to 3% — a very small amount of the total extraction.

A critical market feature is the limited number of producers. Current production is concentrated among a few countries: United States, Qatar, Russia

Production of helium, the second lightest element after hydrogen, is expected to rise with Qatar and Russia ramping up their output though geopolitical tensions create supply uncertainty.

Pricing Trends and Market Value

Historical pricing data shows significant appreciation as helium prices have gone parabolic, growing over +400% in the last few years.^[1]

The U.S. geological survey indicates that 2023 estimated U.S. sales of grade-a helium and gaseous helium was an estimated 2.8 billion cubic feet valued at about $1.1 billion.^[2] Major economies have designated helium as strategically important. Recognizing its critical importance, major economies such as the United States, the European Union and mainland China have listed helium on their critical materials lists due to the high risk of supply shortages.^[1]

Emerging Market Players

New entrants are beginning to enter the market. In January 2023, South Africa became the world's newest producer of liquid helium, joining eight other countries globally in helium productio demonstrating the market's expansion potential.

China dominates the Asia-Pacific helium market, accounting for approximately 37% of the region's consumption in 2024, followed by India with a growing semiconductor industry supported by government initiatives and foreign investments.

The United States dominates the North American helium market, commanding approximately 84% of the region's consumption in 2024, while Mexico demonstrates the highest growth potential with an expected growth rate of approximately 3% during 2024-2029.^[3]

Pulsar Helium

Pulsar's flagship Topaz project in Minnesota represents a significant helium discovery, with concentrations up to 14.5% and no associated water production. The company is advancing toward production with a clear 24-month timeline to FID. CEO Thomas Abraham-James noted the project's expansion potential:

"We lengthened [the well] and had another 1,600 feet worth of potential helium-bearing reservoir. Our intention is in the next 24 months to get to a point where it's final investment decision for proceeding with production. So that's what we're working hard on."

The partnership with Chart Industries for plant design demonstrates commercial progress. The high-grade nature of the discovery and Chart's involvement in facility development provides a clear path to monetization. Key catalysts include ongoing drilling results and resource delineation. The project's location in Minnesota offers stable jurisdiction advantages, while the exceptional helium concentrations position Pulsar competitively in the North American market.

Georgina Energy

Georgina Energy's strategic acquisition of 100% of the Mt Winter helium project for AU$350,000 strengthens its Australian helium portfolio. The deal structure, including a 2.5% royalty to Mosman, provides clean ownership while maintaining reasonable cost obligations. CEO Anthony Hamilton emphasized:

"This deal further strengthens Georgina's portfolio and increases the potential shareholder value from this asset."

The company remains well-funded to advance both Mt Winter and its flagship 350 km² Hussar prospect. With exploration permits expected within 3 months and plans for seismic reprocessing, Georgina offers investors near-term catalysts in the Australian helium sector.

First Helium

First Helium is advancing its Worsley project with a two-well drilling program targeting Leduc light oil, which provides cash flow to support helium exploration. The company holds over 53,000 acres along the Worsley Trend in Northern Alberta. The combined strategy of oil production supporting helium exploration creates an interesting value proposition. First Helium has already demonstrated success with its 15-25 helium discovery well, suggesting exploration potential across its extensive land position.

Helium One

Helium One, with its 50% working interest in the Galactica-Pegasus project in Colorado alongside Blue Star Helium, is navigating winter weather challenges while preparing for drilling. The company's primary focus remains its Tanzanian assets, where it has demonstrated success with the Itumbula West-1 discovery flowing 5.5% helium. The company has filed for a Mining License in Tanzania while maintaining exposure to U.S. helium development through the Colorado joint venture. This dual-jurisdiction approach provides investors with both African frontier exploration upside and U.S. development potential.

Blue Star Helium

Blue Star Helium is progressing its Galactica project in Las Animas County, Colorado, with infrastructure improvements underway despite winter weather challenges. The company is preparing to drill multiple wells, including Jackson-31 and Jackson-4, with three additional approved locations. First gas production is targeted for 1H 2025, with ongoing work on the Pinon Canyon processing plant. The project area has demonstrated helium concentrations ranging from 2.0% to 8.8% across multiple wells. The company's systematic approach to development and infrastructure preparation demonstrates commercial readiness, while the portfolio of approved well locations provides multiple catalysts for investors.

Key Takeaway

The helium market presents a compelling investment opportunity driven by structural supply constraints and growing demand from critical industries. While the market faces challenges, including geopolitical risks and extraction complexities, the essential nature of helium in modern technology and limited substitution possibilities support long-term value appreciation. Investors should consider exposure to this strategic resource while maintaining awareness of the sector's specific risks and development timelines.

_References:

1. _{Financial News Media Group LLC (Dec 2024). Demand For Helium is Becoming an Extremely High-Value Commodity and Billion Dollar Industry}
2. _{Reuters (September 2024). Helium Demand to Double by 2035, Tracking Chip Production Boom}
3. _{Mordor Intelligence. Helium Market Size - Industry Report On Share, Growth Trends & Forecasts Analysis (2025 - 2030)}