Panmure Liberum sees Helium One as top pick in helium sector

Panmure Liberum views Helium One Global as an attractive way to gain exposure to a structurally supply-constrained helium market. Underlying helium demand is forecast to roughly double by 2035, supporting the strategic value of prospective new supply from the company’s Tanzania and U.S. projects.

Analysis

HE1 is effectively a long-dated option on proving commercially recoverable helium and financing the route from appraisal to production, rather than a clean way to express a tight physical-market thesis. For a pre-production microcap, reservoir deliverability, impurity processing, offtake terms and dilution dominate the commodity backdrop; a favorable resource narrative can support the shares for days, but only independently validated flow-rate and composition data can sustain a 1-3 month rerating.

The more investable second-order beneficiaries of helium scarcity are established industrial-gas distributors with contractual pass-through capacity—Linde (LIN), Air Liquide (AI.PA) and Air Products (APD)—though their helium exposure is too small to drive group earnings. A successful Tanzanian project would modestly reduce dependence on legacy suppliers over a 6-18 month construction horizon, but it would not meaningfully disrupt incumbent pricing unless it reaches reliable export-scale volumes.

Consensus risk is treating demand growth as equivalent to value creation for every exploration-stage helium name. Helium pricing is opaque and project economics are unusually sensitive to recovery rates, logistics, liquefaction access and customer qualification; equity financing at a depressed valuation could erase much of any resource-upside per share. The thesis is falsified by sub-commercial tested flow rates, materially lower helium concentration than management targets, a funding package requiring steep dilution, or a development timeline slipping beyond the next dry-season operating window.

Key Decisions for Investors

• No core position in HE1 before independently reported flow-test, pressure-decline and gas-composition results. Treat any position as venture-style risk capital; size below 25-50 bps of NAV and require at least 3:1 upside to a pre-drill valuation reset.
• For investors seeking a lower-volatility scarcity expression over 6-18 months, prefer a basket of LIN and AI.PA over HE1; the trade captures pricing power from constrained specialty-gas supply while avoiding single-asset geological and financing risk.
• Set an event-driven alert on HE1 for a funded development plan or binding offtake with disclosed pricing/volume mechanics. A post-result entry is preferable if the market initially discounts credible commercial flow data but the implied enterprise value remains below comparable de-risked helium development assets.
• Avoid chasing promotional upside following broker commentary alone. Reduce or exit on a capital raise priced at a material discount, or if testing indicates recovery/processing complexity that delays first commercial sales by more than 12 months.