The rising cost of helium balloon gas in the UK.

In 2005 all the processors of gases and chemicals in the UK saw an increase in energy costs and utilities of over 50 per cent. Despite re-negotiating with utility companies for reductions in prices this meant that pricing policy had to be reviewed in August 2005.

Factors such as natural disasters in the USA, coupled with accidental damage to refineries and storage facilities in 2005 and the massive demand for energy from China are all leading to higher energy prices.

When processing gases such as helium approximately 70 percent of the production costs are electricity with labour and transport being the other major costs. So with large increases in electricity and fuel costs and the impact of the working time directive prices have to rise.

Linde Gas have invested in a new helium facility in Northern Algeria to serve the European market which is expected to come "on-stream" in January 2006. However the cost of transporting liquid helium by sea and road is still high.

BOC say that the increased price of purchasing crude helium from the US Bureau of Land Management has raised the basic cost of the product world-wide. BOC also purchases crude helium from sources in Poland, Algeria and Russia and has recently invested in a new source of supply in Qatar.