Global Helium Industry: An Analysis of the Supply Chain and Development Trends

Ⅰ.Abstract:

In recent years, with the rapid development of technology and the increasing demand for energy, helium gas has gained significant attention as a valuable resource and energy source. The distribution and structure of the helium gas industry have become focal points of interest. This article explores the distribution and structure of the helium gas industry and analyzes its development trends.

Ⅱ.Helium

Helium gas is a colorless, odorless, and non-toxic gas, belonging to the group of inert gases. It is the second element in the periodic table, with the chemical symbol He. At normal temperature and pressure, helium gas exists as a gas with low density and melting point. It is one of the most abundant elements in the universe and constitutes a major component of stars.

Due to its simple atomic structure with only two electrons, helium gas exhibits high thermal and electrical conductivity. At extremely low temperatures (close to absolute zero), helium gas can transform into a liquid state, known as liquid helium. Liquid helium possesses ultra-low temperatures and extremely low viscosity, making it widely used in low-temperature experiments and the production of superconducting materials.

Furthermore, helium gas is non-flammable and does not support combustion, making it commonly used for filling balloons and airships to provide buoyancy. Due to its low density and stability, helium gas is also extensively applied in gas detection, instrumentation, laser technology, nuclear industry, and other fields.

Helium gas, as an emerging strategic resource, has had a limited market size and has seen minimal dedicated exploration efforts for a long time. However, in recent years, with the rapid development of the defense industry and high-tech sectors, global demand for helium gas resources is expected to grow at an annual rate of approximately 5%. In 2021, the global demand for helium gas resources reached 194 million cubic meters (m3), resulting in an overall supply-demand imbalance and significant price fluctuations. Despite the increasing demand for helium gas, the global supply continues to face a tight situation.

The primary source of helium gas is underground helium gas resources, which are only abundant in a few countries. Furthermore, the production and purification processes of helium gas are technologically complex, and the storage, transportation, and distribution stages in the supply chain also present challenges, leading to inadequate supply to meet the demand.

The tight supply and increasing demand for helium gas have led to a rise in its price. The scarcity and high cost of helium gas make it an expensive resource, imposing economic pressures on industries that rely on its usage. The high prices have restricted the use of helium gas in certain application areas and have also driven industries to seek alternatives or more efficient utilization methods.

Recently, countries such as Qatar and Russia have accelerated the construction of large-scale helium gas projects, triggering a global "helium rush." This has prompted many companies to increase their investments in helium gas exploration, extraction technologies, and innovative storage equipment. These developments have brought about a series of new changes in the industry.

Ⅲ.Status and distribution of the global helium gas industry

The global distribution of underground helium gas resources is uneven, with the majority concentrated in countries such as the United States, Russia, and Qatar. These regions possess abundant underground helium gas resources, making them important hubs for the global helium gas industry. The United States is the largest producer of helium gas worldwide, with rich underground helium gas resources, particularly in the Permian Basin located in Texas. The United States, Algeria, and Russia together account for 99.99% of the globally proven helium gas reserves. Among them, the United States is the largest producer of helium gas. However, with the tight supply and increasing demand for helium gas, emerging helium gas industries are also continuously developing.

The helium gas industry exhibits a certain degree of concentration, with a few large multinational corporations controlling the production, storage, and distribution of helium gas. These companies have vast resources and supply chain networks worldwide. The United States holds absolute dominance in the global helium gas trade system. This dominance is not only reflected in the share of domestic helium gas resources and production but also in the control of the global helium gas supply chain by American capital. Over half of the top ten global suppliers of high-purity industrial helium gas are US-controlled enterprises, and US companies also hold a significant presence among the top ten helium gas compressor manufacturers.

The helium gas industry exhibits a certain degree of concentration, with a few large multinational corporations controlling the production, storage, and distribution of helium gas. These companies have vast resources and supply chain networks worldwide. The United States holds absolute dominance in the global helium gas trade system. This dominance is not only reflected in the share of domestic helium gas resources and production but also in the control of the global helium gas supply chain by American capital. Over half of the top ten global suppliers of high-purity industrial helium gas are US-controlled enterprises, and US companies also hold a significant presence among the top ten helium gas compressor manufacturers.

Ⅳ.Trends in the Development of the Helium Gas Industry

As the demand for helium gas continues to grow, the search for new helium gas resources will become an important trend. Some countries are actively exploring and developing new helium gas resources to reduce their dependence on a few resource-rich nations. The Amur Plant, initiated by Gazprom, the Russian natural gas company, began construction in 2015, with full production expected by the end of 2024. The plant is designed to have an annual helium gas production capacity of approximately 60 million cubic meters (m3), and the produced helium gas will primarily be exported. It is projected to surpass the United States and become the world's largest helium supplier by 2030.

The Ras Laffan-3 project in Qatar was initially planned to start production in 2018, with an expected annual capacity of 11 million m3, and a total annual production of approximately 74 million m3 at full capacity. This would account for about 35% of the global helium production. However, considering the complex international environment today, there are still significant uncertainties regarding the helium supply growth in countries like Russia and Qatar. The global helium gas supply remains challenging, and the recent conflict between Russia and Ukraine has led to a shortage of natural gas in Europe. Additionally, the closure of one of the two liquefied natural gas plants in Algeria, which supplies natural gas to Europe via underwater pipelines, further exacerbates the global helium gas shortage.

The scarcity of global helium gas resources will drive countries to strengthen cooperation and jointly address supply challenges. International cooperation can involve resource sharing, technology exchange, and market coordination to ensure stable supply and reasonable prices for helium gas. Currently, the global helium gas trade is predominantly controlled by international major corporations and national oil and gas giants, monopolizing over 75% of the entire helium gas trade market.

In the 1990s, as the applications of helium gas expanded and demand increased, the US government alleviated the global helium gas market's tight supply situation by selling its reserve helium gas. As of 2021, the United States still holds reserves of 86 million cubic meters (m3) of helium gas. However, with the continuous growth in global helium gas demand and the sharp decline in US helium gas reserves and production, the global helium gas supply-demand imbalance becomes more pronounced, leading to significant price fluctuations.

Ⅴ.Summary

In summary, the demand for helium gas is showing a continuous growth trend, particularly in the fields of healthcare, industry, and energy. At the same time, the global helium gas industry is primarily concentrated in a few countries. The tight supply and high cost have led to an increase in helium gas prices and have driven industries to seek alternatives and more efficient usage methods. In the future, with technological innovations and the promotion of resource diversification, the demand for helium gas is expected to be better met, and the diversification of helium gas resources and international cooperation will also have significant impacts on the development of the global helium gas industry.