Air Products Looks to New Methods to Combat Helium Shortage - Modern Distribution Management

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Air Products Looks to New Methods to Combat Helium Shortage

Air Products' new facilities in Colorado, Wyoming to help increase helium supply.

The global helium shortage continues to be a challenge for many industries – and a challenge that may require some industrial and specialty gases companies to think creatively to combat. In its fiscal first quarter 2014 earnings call, Air Products, Lehigh Valley, PA, discussed the ongoing shortage and how its two new facilities in Colorado and Wyoming will help fight the problem.

The U.S. government's helium supply, managed by the Bureau of Land Management, has been declining each year as its finite reserves are depleted. This past October, however, the government passed legislation allowing the BLM to continue extracting helium from their reserve in Amarillo, TX, which provides 30 percent of the world's helium.

While the continuation of this reserve will not increase the global helium supply, it buys time for other helium-extraction methods to be developed, such as the one being built by Air Products in Doe Canyon, CO.

As announced last fall, this plant will use a new technology, developed by Air Products, that extracts helium from the naturally-occurring underground carbon dioxide stream currently processed by Kinder Morgan. The helium will be liquefied on site, with the remaining carbon dioxide passed back to Kinder Morgan.

Once on-stream, the Doe Canyon facility will be the only one in the world extracting helium from a gas stream composed primarily of carbon dioxide. It is expected to produce up to 230 million standard cubic feet per year, replacing 15 percent of the BLM's current declining helium supply.

"The Colorado facility we announced last quarter is on schedule for FY '15 startup. And we have worked with another of our existing U.S. suppliers to expand our natural gas pipeline collection system to increase available helium molecules," said Simon Moore, director of investor relations for Air Products. "…With this new capacity, we are optimistic we will see increased helium supply volumes over the next year.

The company's plant in Big Piney, WY, "is ready," according to Moore. "Our supplier's plant has been in operation and so we expect to receive our crude helium feedstock very soon, which will enable us to begin to provide product to the market as we move through the quarter."

When fully ramped, it is expected to offset about one year of decline in Air Products' share of available helium from the U.S. government. This plant pulls from the Riley Ridge Field, one of the largest helium-rich natural gas fields in the U.S., and is believed to contain enough helium to support production for decades.

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