Air Products Plans U.S. Helium Project

Balloon lovers, nuclear magnetic resonance instrument operators, and other helium users will face at least another year of high prices and low supplies of the gas. After that, things should start looking up, thanks in part to a new Air Products & Chemicals project in Doe Canyon, Colo.

The industrial gases firm will separate helium from naturally occurring underground carbon dioxide that is extracted by Kinder Morgan CO₂ and piped to Texas for use in enhanced oil recovery. The project is the first new source of helium to be announced in three years, according to John Campbell of the gases consulting firm J.R. Campbell & Associates.

The announcement is timely; supplies of helium from the Federal Helium Reserve in Amarillo, Texas, are declining at an accelerating rate. The facility, responsible for about 30% of global helium supply, came close to shutting down entirely this year before Congress reauthorized the sale of helium in October. Falling helium recovery from natural gas reserves, along with production glitches and plant shutdowns, has added to the supply crunch.

The Doe Canyon plant is expected to produce up to 230 million cu ft per year, equivalent to more than 15% of the Federal Helium Reserve’s annual distribution. Air Products also has a joint venture with Matheson Tri-Gas to process helium in Wyoming, but it hasn’t stated when production will start.

Meanwhile, Air Liquide built a large plant in Qatar that has begun purifying helium from natural gas. It will eventually have an capacity of 2.1 billion cu ft. Still, global supply shortages are expected to continue through 2014.

Global demand for helium is rising, particularly in Asia for use in electronics production and magnetic resonance imaging equipment, while supply is not, Campbell points out. “The Air Products project won’t solve the shortage on its own but will reinforce Air Products’ premier position as a supplier with reliable production. It’s also a significant new investment at a time when price is going up due to scarcity.”