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51 min ago 3 min read
Shared helium salt caverns with between one and two billion cubic feet (Bcf) of storage capacity could broaden industry participation beyond the three industrial gas majors.
That was the observation of Dave Marchese, CEO and founder of Caliche Development Partners, who discussed the business model at gasworld’s Helium Super Summit in Houston last month.
He said participating companies could have shared quality standards and financial balancing.
“At that cavern, to take it [helium] out, we would have some compression, and then we may have a pressure swing adsorption and a liquefier, or… that might be on the customer side…the customers will determine how that works,” he noted.
It came as the industry examines how helium salt caverns have softened the impact of supply insecurity amid ongoing geopolitical instability in the Middle East.
Rich Brook, Helium and Industrial Gas Consultant at Garrison Ventures, projected that if the Strait of Hormuz remains effectively closed, global annual supply could sit at around 5.3 Bcf with cavern supply, leaving the global helium market around 8% to 10% short against a demand of six Bcf.
However, he told delegates that global helium supplies could be 20% short of demand if the Strait of Hormuz remains effectively closed and cavern storage sites are depleted.
Helium supply from existing US salt caverns
Industrial gas majors Linde and Air Products both use helium salt caverns in Beaumont, Texas.
Linde’s – developed and operated by Caliche – can hold over three Bcf of helium and helps balance supply and demand through storage and extraction.
Helium can be stored in the caverns for decades and quickly withdrawn when demand spikes. Salt caverns support high cycling rates, allowing for frequent withdrawals without damaging the structure.
In the company’s recent third quarter (Q3) investor call, CEO Sanjiv Lamba said Linde has served its “extremely well” while also signing new customers to long-term helium supply agreements.
In parallel, 40% of Air Products’ helium volumes sold during Q3 came from its storage cavern in Beaumont.
CEO Eduardo Menezes confirmed the figure during the company’s latest earnings call, adding that the company is in a position to continue withdrawing helium from the site for “many, many quarters”.
In line with the shared helium salt cavern model, Marchese noted, “The key here is that storage is stabilisation, and storage is stabilisation for two of the largest companies in the industry, [but] what about the rest of the industry?”
