In a bid to stabilise the world’s helium supply after the Qatar blockade shook the market earlier this month, Air Products wants to make a legal amendment to a central US law to encourage domestic production.
In Air Products’ discussion draft, the company suggests adding The Helium Extraction Act of 2017 to the country’s century-old Mineral Leasing Act.
Currently, companies can lose leases after a decade if they’re not using them to produce either oil or gas but if passed, this Bill would ensure that the extraction of helium from gas produced under a Federal mineral lease would maintain said lease as if the helium were oil or gas.
Walter Nelson, Air Products Vice-President and General Manager for Helium, offered testimony on this and several other important issues regarding helium before the US House of Representatives Committee on Natural Resources yesterday in Washington, D.C.
He said that the added language is crucial to stabilising the global market, given that the US Bureau of Land Management (BLM) plans to sell off its assets in the Federal Helium Reserve by 2021.
“The disruption could impact everyone in the helium industry”
Walter Nelson, Air Products Vice-President and General Manager for Helium
Nelson stressed, “We believe it’s simple. The Minerals Leasing Act can simply be amended by adding a single word, ‘helium,’ to the list of produced substances and will help unlock the door to future US helium developments. It’s another step to ensure a long-term domestic helium is secure for industries that fully depends on it.”
Tensions between Qatar and neighbouring Arabian powers have resulted in an embargo and have disrupted the Qatari helium supply chain, essentially taking a third of the helium supply off the market. As a result, Nelson said that demand has shifted back to the US under the BLM system.
“The disruption could impact everyone in the helium industry,” he continued. “It’s still too early to tell but if you take 30% of world’s supply off the market there will be secondary and tertiary impacts that may not be immediately felt. Today there is insufficient excess helium supply capacity, so if this disruption continues there will be shortages.”
Nelson added there is enough helium supply to meet current US demand for the next five years but said that the crystal ball going past the next decade gets “a little cloudy.”