Bursting helium’s bubble
Global market shakier as government prepares to sell its Texas stockpile
AMARILLO — This Texas Panhandle city justifiably calls itself the “Helium Capital of the World” — it’s sitting on top of one the largest stockpiles of the gas around.
An estimated 2.4 billion cubic feet of helium are trapped deep underground in the Bush Dome Reservoir, accounting for 27 percent of the domestic supply and about 16 percent of the global supply, according to the U.S. government.
It’s the government’s sole helium reserve.
In other words, Amarillo plays a big role in meeting the demand for helium.
There’s a problem, though: worldwide, the amount of the gas is shrinking and demand is increasing, driving up prices as high as 250 percent. The shortage threatens to raise costs across a range of industries, from balloons to rocket engineering, and ultimately for consumers. At one party store in San Antonio, the cost of six balloons was $10.33, up from about $6 in 2017.
Helium is also used in scientific research, medical imaging, deep-sea diving, weather forecasting and advanced manufacturing, said Bill Halperin, a physics professor at Northwestern University. And in most cases, there’s no substitute for the gas, which can be turned into a fluid at super low temperatures, making it useful for cryogenics.
Amid this shortage — helium consultant Phil Kornbluth estimates that demand is outpacing supply by as much as 15 percent — Amarillo is likely to lose its place at the top of the market in the next two years.
It’s not that the Bush Dome will be empty anytime soon. It’s that the federal government, which has traditionally operated the helium reserve at a loss, plans to sell it to the private sector.
Beginning in the 1920s, the U.S. government hoarded helium for military purposes — specifically, to keep its balloons and dirigibles afloat. In time, however, many other buyers in other industries came calling.
Over time, the gas became part of Amarillo’s identity. In 1968, the city erected a stainless steel statue dedicated to the helium industry. The Helium Centennial Time Columns Monument, featuring a giant helium atom at its core, sits outside of the city’s science museum.
Despite Amarillo’s long history with the gas, the Federal Helium Reserve — the stockpile’s official name — is set to go out of business in September 2021, a sunset date set by Congress under the Helium Stewardship Act of 2013.
Amarillo’s helium stockpile is located on the outskirts of Amarillo, about 3,500 feet underground. Getting to the operation requires driving down a winding dirt road, passing fields of yellow wildflowers, a few steers and a small meeting place for a gun club.
Helium is usually discovered in underground
pockets, essentially a byproduct of natural gas extraction, and it’s irreplaceable — you can’t make the stuff. Samuel Burton, field manager of the Amarillo office and a former chemist, described the Bush Dome reservoir as a sort of “layer cake” of porous dolomite and dense caprock keeping the helium securely trapped underground until it needs to be extracted.
The operational side of the Reserve is at the Cliffside Gas Field, where helium is enriched and transported through its pipeline system. The helium processing plant atop the reserve is small. It cools the helium to temperatures to minus 250 degrees, which eliminates impurities in the gas. What’s left is a nonflammable gas that is then transported to market by a 425-mile pipeline that terminates at Bushton, Kan.
Operations Manager Barry Stoll, who has a big white beard and whose shoulder-length blonde hair secured underneath a white hard hat, says Cliffside has a soul. “She’s still chugging along,” he said.
Stoll said he started working in the industry 34 years ago, when helium was primarily used for balloons. But times change, and it’s not always kind.
A search for one of the original helium facilities led to the intersection of Helium Plant and West Amarillo roads. Behind a Texas historical marker at the site, not much was left to see except an old building with glass shards where the windows used to be. Signs on a chain-link fence perimeter warned: “All copper has been stolen out of this facility — keep out!!”
Tourists are much more interested in the nearby Cadillac Ranch, an art installation created by helium heir Stanley Marsh III, featuring 10 cars sticking out of the soil. Cans of spray paint are left by staffers for those who want to leave their mark on the Cadillacs or soil.
Marsh faced numerous child sex abuse allegations, with some still pending at the time of his death in 2014.
When the government pulls out of the helium industry, the plan is to sell the reserve to private companies. Burton pushed back his retirement to see the facility through the transition.
At least 40 employees will lose their jobs because of the closure.
The operation still brings in thousands of dollars for the U.S. Treasury each day from small sales from the stockpile, but the government has been trying to get out of the helium business since at least the 1990s.
Kornbluth, a consultant who’s worked in the helium industry for 36 years, said some are concerned the coming sale of the government’s helium reserve could further disrupt the market. He has suggested lawmakers delay the sale, but the idea hasn’t gain much traction.
“As far as I can tell, it’s fullspeed ahead to sell the assets,” he said. There are a lot of unknowns, he added, especially because no one knows who the buyer will be and what they plan to do with the stockpile of helium.
“The only thing we can say about it is we don’t know what the impact will be,” he said.