Helium Super Summit: Helium market to become less US centric

During session one we heard that Air Products has started up the ”world’s largest helium storage cavern” in Texas. Walter Nelson, Vice-President of Global Helium and Rare Gases at Air Products, revealed the news first at the gasworld event – and an official announcement is expected soon from the major industrial gas company.

Read more: Helium Super Summit: Air Products reveals ‘world’s largest helium storage cavern’

This afternoon, however, we shifted focus onto Sourcing and Supply, as delegates heard update from Gazprom’s Amur project, the privatisation of the Bureau of Land Management’s (BLM’s) helium asses and more were in focus.

Gazprom Amur project: The $15.5bn investment is now over 80% complete

Phil Kornbluth, President of Kornbluth Helium Consulting, was first to take the stage, telling delegates that Gazprom’s Amur project is now 80.9% complete and, once complete, will consist of six trains with a capacity of seven billion cubic meters (bcm) annually – a 42bcm/year design capacity.

Focusing on the helium aspect, “There’s going to be three helium trains, with a 700 million cubic meters (mcm)/year each capacity each. Each helium train will process the feed from two of the six processing trains.”

“The first train started up in September 2021, the second train is scheduled to start up in the first quarter of 2022 and train three will start up in 2024, with full capacity expected in 2025.”

Already, the plant, which is an estimated $15.5bn investment, has resulted in long term contracts with helium majors. To act on these, the project plans include the development of a $82m helium hub located near Vladivostok – believed to be the largest helium logistics centre in the world.

The facility is designed to process >4000 helium containers traveling to/from Amur and will include helium liquefaction and liquid helium storage. The helium hub went into service in September 2021.

Kornbluth continued, “Gazprom’s helium hub at Vladivostok is designed to process more 4000 helium containers travelling to and from Amur. The helium hub is going to manage all the transportation and it’s the largest helium logistics centre in the world. All of Amur’s helium sold to foreign customers will be delivered via the helium hub. It’s like a super transfill.”

So how will this new supply impact the helium market?

Kornbluth explained the start-up will see Russia become the world’s third major supplier during 2022 and threat of sustained shortages should subside. However, Kornbluth told delegates, “The impact isn’t going to be like someone switching on a light switch.”

Focusing on the price, Kornbluth explained that there should be a downward trend in price and improved terms for buyers. Continuing the pricing focus, Kornbluth said the Amur supply will be low cost and quite competitive with supply from Qatar and the US, with competitive advantage in Asian markets.

Of course, all of these means the helium business continues to become less US centric – and by 2025, it is believed the helium market will become a three-horse race between the US, Qatar and Russia. 

The privatization of the Bureau of Land Management (BLM)

Following on from Kornbluth’s conclusion which looked at the diminishing reliance on the US for helium, Sam Burton, Field Manager for Helium Operations at the Bureau of Land Management’s (BLM) Federal Helium Program, took the stage to provide an update on the privatisation of the BLM’s helium assets.

As gasworld US wrote in its latest Helium issue, uncertainties around the reliability of overseas helium sources might not be a huge concern today, but there is worry that they could be in the future if North America becomes heavily dependent on importing helium from Russia and Qatar (as mentioned multiple times throughout the morning sessions).

Burton’s discussion follows his presentation given during gasworld’s 2018 Helium Summit, at which he told delegates US Bureau of Land Management (BLM) continues to work towards the privatisation of the Federal Helium Reserve and is following three key steps to a smooth transfer to private administry.

Today (8^th Dec), providing an update, Burton told delegates that so far, “The BLM and GSA have successfully entered into a Memorandum of Agreement (MOA) to work together, and phase one environmental report has been completed with no outstanding recognised environmental conditions.”

Alongside this, many other steps have been completed as part of the privatization, but looking ahead, Burton told attendees that Federal Helium Assets to be sold include:

• Mineral rights to Bush Dome Reservoir
• Cliffside plant facility, gas wells and pipelines
• Central compression
• Natural gas chiller skid & NGL storage
• Crude helium pipeline, meters and cathodic protection
• Satanta maintenance station

Burton said, “The transition period to the new owner could take a while, we’re not sure yet. The next quarter in 2022 after September, we expect there will be a smooth transition to a new buyer.”

He concluded, “The government is taking the last steps to complete the mission of the BLM and we are well on track to making that happen.”

Qatargas to start up fourth helium plant in 2027

Jassem Al-Mulla of QatarEnergy, has just told Helium Super Summit attendees that Qatargas will start up its fourth helium plant, dubbed Helium 4, in 2027.

Once operational, the plant will take feed gas from four LNG trains associated with the North Field Expansion Project, the Helium Super Summit heard.

Already, Qatargas has three other major helium plants onstream. “Qatar’s growing helium production has been critical to meet the growing helium demand,” Al-Kubaisi told delegates.

He continued, “Qatar’s helium production is defined by its reliability and high quality. Our first helium plant started production in 2005 and has a capacity of 700 mcfa.”

“We are pleased to announce that last year Helium one achieved technical reliability of 97%. All of our Helium produced here is currently sold under long-term contracts.”

The company’s major facility, however, Helium Two, is believed to be the largest in Qatar.

“Qatar’s third helium plant started production earlier this year and we have already filled 175 ISO containers out of the refinery,” Al-Mulla said.

ExxonMobil to offer new helium contract types in 2022

“ExxonMobil is currently producing around 1.5 billion cubic feet of helium each year.”

That’s exactly what Abigal Thurston, Commercial Manager of CO2, Helium and Trucked LNG at ExxonMobil Upsteam Oil and Gas Company told Helium Super Summit attendees this afternoon as she took to the stage.

Currently responsible for approximately 20% of the world’s helium, according to Thurston, ExxonMobil is the owner of the landmark LaNarge project in Wyoming – one of the largest in the world.

Thurston said, “We currently produce about 1.5 Bcf helium a year. We sell helium at the plant, customers bring ISO to the plant to be filled by our operations team.

“Starting January 1, 2022, we will have multiple contract types so you can choose your level of security of supply, with plans to add gaseous sales by third quarter 2022. Usually, we have about three months before we have these spot sales before we select a winner.” 

Exxon also captures and sells CO2 from the Wyoming plant. It is currently producing and selling about 340+ MCFD. Exxon operates 160 miles of CO2 pipeline and seven metering facilities in southwest and central Wyoming. 

Tonight, attendees will attend an event dinner sponsored by the Saskatchewan Energy and Resources, at which Bronwyn Eyre, Minister of Energy and Resources for the Saskatchewan Government, will be speaking.