To drive west through Amarillo, Texas, is to be confronted by a litany of billboards luring passersby off the freeway to sample the town's famous 72-ounce steaks and a bit of the cowboy culture that put the Texas Panhandle, flat as a rodeo arena, on the map. But Amarillo, a far-flung dusty urban island between Albuquerque, N.M., and Oklahoma City, is also helium country—for now.
Amarillo has been called the helium capital of the world because the area is home to the Federal Helium Reserve, a vast underground storehouse operated by the U.S. Bureau of Land Management (BLM). The government created the Federal Helium Program in 1917 to provide helium for blimps during World War I; the reservoir is in Amarillo because the natural gas fields between there and southern Kansas have a high helium concentration—up to 1.9 percent—making them more helium-rich than most other natural gas fields around the globe.
Helium became vital to military reconnaissance and space exploration during the 20th century, so Congress mandated that private helium producers sell their helium to the government and store it in the Bush Dome Reservoir to create the Federal Helium Reserve. Today about 2 billion cubic feet of helium are produced each year from the BLM's Cliffside Gas Field about 15 miles north of Amarillo, which extracts helium from the Bush Dome Reservoir where, in the 1960s, the inert gas was injected into porous rock 3000 feet underground. About 35 percent of the world's helium supply originates from here.
As we reported this summer, however, there's a helium shortage going on, threatening not just balloons but also places, such as hospitals, that need helium for MRI scanners. And it could mean that Amarillo's status as chief producer of helium for both America and the world won't last much longer. So last month we traveled out to the Texas Panhandle to see where our helium comes from.
The BLM's helium enrichment plant, seemingly dwarfed by the sweeping arid landscape in which it sits, operates in a mesquite flat in the middle of a broad and empty depression in the plains north of Amarillo. The BLM's helium travels to market via 450 miles of pipeline across those plains. The BLM's cryogenic helium processing facility and the Cliffside Gas Field's 23 helium-producing natural gas wells were operating here during our visit in late October.
Deward Cawthon, the BLM helium enrichment plant supervisor, took me out to the nearest and best-producing of those wells, the Bivins A-6 well. It sits just outside the plant's perimeter, at the point where helium was injected underground to fill the strategic reserve. The well is enclosed in a small concrete bunker and covered with a heavy steel door to prevent enemies from identifying the field during wartime. Of the 2.3 million cubic feet of gas it produces per day, about 60 percent is helium. (The rest is natural gas, with small quantities of nitrogen, butane, propane, and other heavy hydrocarbons in the mix.)
The Bivins well produces the most helium in the field because it sits near the original injection point, Cawthon says. Other wells produce helium of wildly varying purities, with some producing less than 2 percent helium. The farther the well is from the injection point, the less pure the helium it produces. Other wells in the field aren't producing helium at all anymore, and some only produce occasionally.
Gas extracted from the wells runs through pipes and into a metering station at the helium plant. The metering station is where BLM engineers gauge gas pressure, temperature, and flow, allowing them to accurately blend the gases because the system requires just the right balance of helium and methane. The gas from all the wells is then fed into a single pipe that sends the gas into a compressor and then to the cryogenic processing plant where the other gases are separated from the helium. First the carbon dioxide is removed. Then the gas, at about 93 F, is sent into a "cold box" where it is chilled to the point where most of the methane will liquefy and drop out of the mix. The remaining gas is chilled again to minus 267 F.
What's left at this point is mostly helium and nitrogen, and some of those gases are removed, recycled, and used elsewhere in the plant. The crude helium that comes out at the end of the process is composed of 78 percent helium, 21 percent nitrogen, and about 1 percent methane.
The BLM expects the worldwide demand for helium, currently about 6.2 billion cubic feet per year, to increase about 10 percent in the coming years. But the world's helium supply has been in trouble.
In October helium increased from $84 per thousand cubic feet, or Mcf, up from $75.75 per Mcf for the first nine months of 2012. Prices are increasing because most of the helium produced elsewhere in the world comes from the production of liquefied natural gas, an industry hit hard by falling demand because of the faltering economy. And as demand in Asia is rising, helium enrichment plants in the Middle East and Australia have been hit by maintenance problems that created a shortage expected to last through 2013, or until new helium enrichment plants can start running.
Here in the U.S. there is only enough helium left in the government reserve near Amarillo to last about another three years. The reasons are both technological and political.
First, it's becoming more and more difficult to produce high-quality helium from the reserves that remain. Helium stored underground depletes over time, lowering the quality and concentration of what remains to be extracted. Then there's politics: the helium enrichment plant at Cliffside is set to shut down by 2015, as mandated by a 1996 federal law. Back then Congress aimed to privatize the helium program, so it required the federal government to halt helium production and refining activities and sell off the government's massive helium stockpile at Cliffside. But so far private industry hasn't stepped in to pick up the slack.
Despite the helium shortage and the helium program's looming shutdown, though, the BLM cannot increase production at Cliffside—it's already operating at full capacity. Ramping up production any more and accumulating salt deposits could damage the equipment, or the helium could become trapped or permanently lost, says Sam Burton, the BLM's assistant field manager of helium operations.
"By overproducing a well, the pressure drops so quickly that portions of the formation do not drain as completely as if they were produced more gradually," he says. "This gas is considered 'left behind,' as you would have to 'sweep' the remaining helium with other gas to extract it further."
Now the future of the Cliffside field, and any helium that remains by Jan. 1, 2015, depends on the federal government. A bill currently before Congress, the Helium Stewardship Act of 2012, aims to allow 3 billion cubic feet of helium to remain in reserve for use by the federal government while allowing the BLM to get out of the commercial helium business altogether. U.S. Senate Natural Resources Committee Chairman Sen. Jeff Bingaman introduced the bill earlier this year but is leaving Congress at the end of the year. The bill remains stalled in the Senate since hearings were held on the bill last May.