A Safe and Reliable Supply of Helium is Necessary for U.S National Security
Compressed Gas Association Asks for Federal Intervention to Delay the Disposal of the Federal Helium Reserve
FOR IMMEDIATE RELEASE: JULY 15, 2022
MCLEAN, VIRGINIA – The Bureau of Land Management’s Federal Helium Reserve (FHR) in Amarillo, Texas, has been a critical asset for the U.S. economy for many decades. The FHR has historically provided a safe and reliable supply of helium to power incredible growth in U.S. industries. However, the Helium Stewardship Act of 2013 required the Bureau of Land Management (BLM) to transfer the functions for selling off and disposing of remaining helium and helium assets to the General Services Administration (GSA) by Sept. 30, 2021. In turn, GSA is pushing to complete marketing, asset valuation, and dispose of all assets on or before September 30, 2022 by auction. The winning bidder will take over operations and helium production from the field. It looks increasingly likely that once the new owner takes ownership, the system could be shut down for months and perhaps years to resolve the issues brought about as the result of the transfer to a private owner.
Without federal intervention to delay the disposal of the BLM’s FHR, the supply of helium will be reduced and important sectors of the economy including government users, such as the military, will be imperiled. As a result, the national security of the United States will be significantly and negatively impacted.
“Without federal intervention to delay the disposal of the BLM’s FHR, the supply of helium will be reduced and important sectors of the economy including government users, such as the military, will be imperiled. As a result, the national security of the United States will be significantly and negatively impacted.”
Helium has unique thermal conductivity properties. Helium’s elemental character to withstand cold is unprecedented, as it is a stable gas down to -269°C – very close to absolute zero (-273°C). Near absolute zero environments are necessary preconditions for most advanced quantum computing environments.
These properties also make helium a key resource for the U.S. domestic manufacturing supply chain. Helium is used for semiconductor production, resonance imaging (MRI) machines, nuclear power generation, and is significant for federal research at the Department of Energy, the National Aeronautics and Space Administration (NASA), the Department of Defense and at national laboratories across the US.
Specific to semiconductors, our modern techno-economy cannot function without the quality produced, and assured supply, of these chips. These technology wonders are foundational to how we communicate (e.g., smart phones), how we transport people and goods (e.g., cars, trucks, airplanes), in what capacity research and development is done (e.g., laboratories), and to how we defend our nation (e.g., F-35, Trident class submarines, spy satellites). Without uninterrupted access to helium all of these downstream use cases, and thus our security, are put in a perilous position.
Concern’s with the GSA’s Disposal Plan
As the GSA prepares to dispose of the FHR, a number of issues have come to light that need to be resolved to ensure the continued safe and reliable supply of helium.
- The Cliffside Helium Enrichment Unit (CHEU) at the FHR is critical to the extraction and enrichment of the helium. However, the CHEU is separately and privately owned and not part of the GSA disposal process. The new purchaser of the FHR must negotiate a new contract to operate the CHEU, or must build a new unit.
- The FHR pipeline extends through three states – Texas, Oklahoma and Kansas. Approximately 14% of this pipeline lacks rights of way that must be secured prior to the new purchaser operating the system.
- The BLM, pursuant to Unitary Executive Theory, has not been required to comply with certain federal and state laws and regulations (i.e. PHMSA, FERC, DOT, etc.). The new purchaser, most certainly a private entity, must comply these laws and regulations prior to operation.
- Federal users with significant helium needs (e.g., the Departments of Energy and Defense, NASA, and the National Institutes of Health, among others) rely on a consistent helium supply through the Federal “in-kind” program through the BLM. Essentially the program provides these Federal users with preferential delivery status and pricing. With the privatization of the FHR, this in-kind program will end and with it the special privileges the U.S. government has come to rely on to meet its critical helium needs. Congress had mandated that BLM develop a 20-year plan for phasing out the in-kind program; however, to the best of our knowledge this was never completed which will leave the Federal users in distress when the program ends in three months.
Each of the above issues will take months or years to resolve. The new purchaser will not be able run the system until each has been resolved, meaning that no helium will be produced or extracted during this period. CGA requests the sale be delayed until each of these issues has been resolved.
Supply of Helium
A 2020 analysis by the U.S. Geological Survey estimated that the U.S. supplies 43% of helium globally. Between 21% and 30% of the U.S. produced helium derives from the FHR in Amarillo depending on the year. Second to the U.S. is Qatar which supplies 32% of global helium. Russia is projected to be the third largest supplier with a 28% share by 2025. As other countries ramp up production, the U.S. production share will decline to 35% by 2025 – a drop of one third.
54% of all helium produced in the U.S. is used domestically. However, as semiconductor manufacturing is returned to U.S. shores – a necessity brought to light by the supply chain disruptions experienced during the pandemic – much of the “exported” helium will also come back on-shore.
Regarding alternate sources, several years ago an embargo of Qatar by Saudi Arabia caused significant disruptions in helium supply, amongst other Qatari exports. Another disagreement between Saudi Arabia and Qatar would likely have similar supply implications. And, although Russia is bringing significant production online, dependence on Russian helium leaves the U.S. supply in the hands of an unfriendly government. Russia’s invasion of Ukraine highlights the challenge of relying on this source. These two examples highlight the importance of maintaining a reliable supply of helium from the FHR.
Helium is necessary for many critical applications throughout the U.S. economy and military, and is directly tied to our national security interests. Geopolitical events have highlighted the need for a reliable, domestically produced supply of helium. The disposal of the FHR by the GSA will result in an interruption to this supply. The way to avoid this interruption is to delay the disposal to resolve a number of issues around rights of way and compliance requirements that the new purchaser will face.
CGA was founded in 1913 and is an ANSI-accredited standards developing organization that is dedicated to the development and promotion of safety standards and safe practices in the industrial, medical, and food gases industry. CGA’s membership is comprised of more than 130 companies globally, covering all facets of the industry: manufacturers, distributors, suppliers, and transporters of gases, cryogenic liquids, and related products. Our customers can be found in the electronics, industrial, medical, food, telecommunications, computing and energy sectors. For more than 100 years, CGA has been dedicated to the development and promotion of safety standards and safe practices within the industry and to assuring the American public quality assured products, such as commercial grade helium.
# # #