At a time when helium supply would be ample if the major sources were operating normally and helium markets are anticipating a significant influx of new supply from Gazprom’s Amur Project by the end of the year, a series of unplanned outages has temporarily disrupted supply and caused renewed concern about shortages.

Source: Gazprom

Gazprom’s Amur GPP, Russia

Three recent events have removed supply from the market during June and July. The Skikda, Algeria plant shut down in mid-June and is expected to be out of operation through at least the month of July due to problems with the LNG plant which provides feedgas for the helium plant. This outage removes 300 – 400 million cubic feet (MMcf) of annual capacity from world supply. 

At around the same time, the Keyes Helium plant, which is one of the four helium liquefaction plants connected to the BLM went down due to a broken turbine. This removes 100 MMcf+ from the market and the time required for repair could be several months. More significantly, the Bureau of Land Management (BLM) shut down its Crude Helium Enrichment Unit with minimal notice on July 1 to address safety issues.

The BLM continued to allow withdrawals of crude helium from their crude helium pipeline until the pipeline pressure declined to 600 PSIG on July 19. After July 19, crude helium withdrawals will not be allowed until the plant restarts and pipeline pressure recovers. While the BLM’s outage was originally scheduled to last through the end of July, cases of Covid at the BLM’s facility delayed the BLM’s work plan and are expected to extend the shutdown through at least mid-August. 

With normal deliverability of crude helium into the BLM Pipeline of 2.3 MMcf per day, this removes up to 800 MMcf of potential capacity from world supply, not counting the loss of helium produced from current natural gas processing. 

While there was some slack in the market prior to these outages, there was not enough to absorb the loss of more than 1 Bcf of annualized supply.  As a result, the helium market will be experiencing a supply deficit until the BLM resumes operation. With the BLM System down, there is very little flex capacity available. Tumbleweed Midstream’s Ladder Creek Plant has excess liquefaction capacity and has the ability to increase tolling activity and helium production. Air Liquide’s storage facility in Gronau-Epe, Germany also can provide some flex capacity.  

Although spot market activity and prices have perked up due to the current tight supply, Kornbluth Helium Consulting does not expect recent events to have a significant impact on contract prices, as long as the tight market conditions are relatively short term.

These latest incidents provide a reminder that even though the demand shock caused by Covid-19 ended Helium Shortage 3.0 early in 2020, the helium supply chain continues to be fragile with limited ability to respond to significant plant outages. Hopefully, the current plant outages will be resolved and the balance between supply and demand will be restored within the next couple of months.

About the author

Phil Kornbluth is the President of Kornbluth Helium Consulting, LLC and is a member of gasworld’s Editorial Advisory Board. Phil has worked in the Helium Business for the last 38 years, including stints running the global businesses of both BOC Gases and the Matheson subsidiary of Taiyo Nippon Sanso Corporation. Phil can be reached at or +1 (908) 745-9779.