Now it's the U.S. Senate's turn to take a crack at heading off a looming shortage of helium. Today, the Senate Committee on Energy and Natural Resources heard testimony on a bill sponsored by chair Ron Wyden (D-OR) and ranking member Lisa Murkowski (R-AK) that would authorize sales of federally owned helium past this fiscal year, which ends on 30 September. Without such legislation, those sales will cease, cutting off 42% of the U.S. supply of helium and 35% of the global supply. The only element that remains a liquid at absolute zero temperature, helium is indispensable for cooling the superconducting magnets in MRI machines, purging rocket engines, and performing low-temperature physics experiments. It's also key to manufacturing optical fibers and microchips. The House of Representatives passed a similar bill 2 weeks ago.
The problem itself is largely of Congress's own making. In 1996, it mandated that the federal government sell off the vast reserve of helium that it had accumulated primarily during the Cold War and stored in a natural geological formation near Amarillo, Texas. Those sales began in 2003 and aimed to recoup the $1.3 billion that the government spent accumulating the helium. Even though it is now selling helium at below-market value, the Bureau of Land Management (BLM) will break even this fall with roughly 370 billion liters of gas still in the ground. At that point, the sales will stop—unless Congress acts. That's why both the House and the Senate committee are rushing to pass legislation to keep the sales going.
Like the House bill, the Senate bill would continue the current sales for another year. Then, in a second phase, BLM would sell a portion of the helium at auction, so as to realize a market price. In the first year, the amount auctioned would begin at 10% of the total amount sold. It would increase by 10% each subsequent year. Finally, when the reserve dipped to 85 billion liters—in about 5 years—sales would be restricted to federal users, including the holders of research grants. The House bill has similar phases and differs most significantly in that it would require BLM to make all sales through biannual auctions.
The Senate's tack of phasing in the auction is preferable, Walter Nelson, director of helium sourcing and supply chain at Air Products and Chemicals Inc. in Allentown, Pennsylvania, told the committee. The House's more radical approach would make it impossible for the three private refiners connected to the reserve to develop the long-term contracts on which their business depends, he testified. "The wisdom of your approach contrasts, with all due respect, with the House's approach, where the semiannual auction of 100% [of the helium] would commence almost immediately," he said. "This would create tremendous uncertainty in supply for end users and the timing infringes on our existing contracts."
Even now, with the BLM sales ongoing, helium supplies are running low. In particular, scientific users are struggling to get what they need, testified Moses Chan, a physicist at Pennsylvania State University, University Park. Such users are already supposed to be able to buy refined helium from suppliers at a discount through an "in-kind" program in which the supplier then buys an equivalent amount of federal helium. But not all suppliers seem to be honoring that bargain for small-scale users, Chan testified. As a result, some scientists have seen the price of helium quadruple in the past few years, he said. A typical low-temperature physicist already spends roughly half his grant money on helium, Chan tells ScienceInsider.
Of course, the situation will only get worse if Congress does not act. First, the Senate must pass a bill. If that happens, then the question will become, are the Senate and House bills similar enough to be reconciled or different enough to sink the whole deal?