Blue Star Helium Sells First Production Tube Trailer from Pinon Canyon Processing Plant

Blue Star Helium (ASX: BNL) has confirmed the sale of its first production tube trailer containing high-purity compressed helium gas produced at the Pinon Canyon helium and carbon dioxide processing plant within its Galactica project in Colorado.

The sale was conducted under an early production spot sales arrangement following a recent acceleration in uptime and helium output that led to increased production fill rates.

A second tube trailer — the first under a three-month fixed price offtake agreement secured last month with a major US industrial gases purchaser — is now on-site and being filled.

Blue Star’s maiden sale concluded the early production commissioning and optimisation phase of Pinon Canyon, which has resulted in substantially increased uptime and longer phases of steady-state operation.

The plant is now demonstrating routine runtimes and shut-in and restart cycles characteristic of the expected long-term operational profile.

Raw Gas Processing

Pinon Canyon processes raw gas from the Lyons Formation sandstone reservoir, utilising an amine unit to strip out the carbon dioxide then refining the remaining helium-enriched gas through a helium recovery unit before pumping it into tube trailers for the North American market.

As plant and gathering system refinement continues to ramp up, Blue Star is considering the potential of deepening existing wells to expose more reservoir and further increase well flow.

Consistent with the original development plan and subject to permitting approvals, the company plans to drill three new wells before year end for tie-in to Pinon Canyon to further increase raw gas throughput and helium output.

Blue Star is also focused on securing a commercial solution for stripped carbon dioxide from the plant as a valuable secondary revenue stream.

Important Project Achievement

Managing director Trent Spry said the first tube sale was an important achievement for the Galactica project.

“This milestone validates the quality of our helium product and establishes Blue Star as an active supplier to the US domestic helium market at a time when reliable, in-country supply commands a premium for US customers,” he said.

The North American helium market is exhibiting strong pricing fundamentals driven by sustained, structural demand across high-spec manufacturing sectors such as semiconductor fabrication, aerospace engineering, and advanced defence technologies.

The global helium market continues to be affected by structural supply chain disruptions, rationing and surcharges resulting from prolonged instability in Middle Eastern supply routes, which has materially increased demand for reliable, US-sourced domestic supply.

“The fixed pricing secured under our new offtake agreement reflects the strength of current US spot market demand and provides an operational bridge while we focus on finalising the broader longer-term structural agreements that are set to underpin our future output growth,” Mr Spry added.