The Global Helium Supply by Richard Clarke

The Global Helium Supply by Richard Clarke

The Global Helium Supply
Richard H Clarke
Independent Process and Resources Consultant,
Oxford UK
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Inflation-adjusted price $ / mcf
75 years of US He policy
Katie Peek
Popular Science infographic
August 2013
Sales bcf / y
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Gasworld Helium Summit
• June 2013, London
• International audience
• He suppliers and users, worldwide
• Thinking beyond Cliffside…
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Helium Stewardship Act 2013
• All done in context of “Fiscal Cliff”
• Widespread misconceptions about He
• Huge angst in high tech!
• Global lobbying campaign by Gases
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BLM Cliffside, 2013
Walter L. Nelson
Air Products and Chemicals Inc.
12 February 2013
US House testimony: HR527
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Geography: Qatar
• North Field NG ~0.04% He
• Qatar Ras Laffan-1
– 9 tonne/day LHe by 2008
• Qatar Ras Laffan-2
– 20 tonne/day capacity
 Qatar ~25% global supply
Dec 2013: “Qatar mulls 3rd helium
unit” – Dr. Mohamed bin Saleh alSada, Minister of Energy and
Industry, Qatar
Ras Laffan – 1st Qatar Helium Refinery
Image: Air Liquide / Patrick Avavian
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Market: sources & applications
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Market: regional demand
Other
Americas,
10%
Africa /
MidEast /
India, 6%
US, 32%
Pacific
Rim, 31%
Europe,
21%
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“Mind the gap”
no market growth
Bcf
Surplus
8
Shortfall
Australia
6
Russia
Qatar
Poland
4
Algeria
Cliffside
2
Riley Ridge
Mid-USA
0
2005
2008
2011
2014
2017
2020
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“Mind the gap”
2% market growth
Bcf
Surplus
8
Shortfall
Australia
6
Russia
Qatar
Poland
4
Algeria
Cliffside
2
Riley Ridge
Mid-USA
0
2005
2008
2011
2014
2017
2020
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Market: price
$ 200
180
160
140
Helium prices per Mcf (1000 cu.ft ≈ 4.7kg)
Private Industry Grade-A helium (range shown)
US Government Grade-A helium (estimated)
US Government Crude helium
exponential P = 40 * EXP(0.12 * (year-1999))
$170
120
100
$84
80
60
$49.50
$42
40
20
0
1998
2000
2002
2004
Source: Washington Post / BLM
2006
2008
2010
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Market: price-revenue
Z. Cai et al
‘Ongoing ascent to the helium
production plateau – insights from
System Dynamics’
Resources Policy (2010)
Supply effect on price (using 2012 data)
120%
80%
Revenue
4000
dP
40%
3000
0%
-40%
-30%
-20%
-10%
0%
2000
10%
d(P.Q)
20%
d(p.Q)
2012
-40%
1000
change in sales, dQ
price P, $
0
dQ / dt = Q { e / p . dp / dt + g }
e, elasticity – 0.4 approx
0
100
200
300
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400
500
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Market: what is the price of He?
Helium price analysis - 28mar14
input
prodfactor instead of localfactor
examination of downfactor on revenue
- - Total
ok HeatTrans
$ / mcf
0
551
661
0
0
661
0
826
6
ok Pr&purge
$ / mcf
0
684
0
821
0
821
0
1027
5
ok ContAtm
$ / mcf
0
1181
0
1417
0
1417
0
1771
5
5
ok LeakTest
$ / mcf
0
1392
0
1670
0
1670
2087
0
ok Analysis
$ / mcf
0
1392
0
1670
0
1670
0
2087
8
ok AirWeather
$ / mcf
0
1392
1670
0
0
1670
0
2087
100
ok Balloons
$ / mcf
0
912
0
1094
0
1094
0
1367
ok Balloons ok
$ / cf
0
0.91
0
0
1.09
0
1.09
0
0
0
1.37
0
1.14
1.14
242
242
0.70
0.87
0.00
301 1
301 0
809 0
809 0
376 0
376 0
447 0
447 0
556 0
556 0
959 0
959 0
1130 0
1130 0
1130 0
1130 0
1130 0
1130 0
740 1
740 0
0.74
0.74
1
0
5
5
1.00
1.00
205
205
0.68
0.68
1.00
1.00
255 0
255 0
684 0
684 0
318 0
318 0
378 0
378 0
470 0
470 0
811 0
811 0
956 0
956 0
956 0
956 0
956 0
956 0
626 1
626 1
0.63
0.63
1
1
2
2
2
1
1.60
1.60
1.60
2.00
358
358
339
424
1.14
1.11
1.80
0.96
0.00
0.99
1.29
445
445
421
527
555
555
526
657
661
661
626
783
1
0
1
1
1.09
1.09
1.04
1.30
1
0
1
1
1
2.00
424
0.00
527 0
1295 0
1.30
0
0
0
0
0
1195
1195
1132
1415
0
0
0
0
1415 0
downstream px curve
vol factor px factor
0.01 20
19.88
0.25 1
1.10
CS=Cliffside AL=Algeria QA=Qatar PO=Poland(Odalanow) RU=Russia(Orenburg) AU=Australia
0
0
0
0
657 0
downfactor
0.315
-0.9
0
0
0
0
821
821
778
973
0
0
0
0
1417
1417
1343
1678
973 0
783 0
0
0
0
0
1670
1670
1582
1978
1678 0
0
0
0
0
1670
1670
1582
1978
1978 0
1670
1670
1582
1978
0
0
0
0
0
0
0
0
1094
1094
1036
1295
1978 0
1978 0
Revenue per stream?
Note:
it is assumed that one buyer buys all the helium in each class (which is usually not the case
except perhaps in the MRI markets)
Careful: if volume>0.3 price factor <1 !
50
Your prices
MRI px
90%
80%
70%
60%
50%
40%
30%
20%
Welding
HeatTrans
Pr&purge
ContAtm
LeakTest
Analysis
AirWeather
Balloons
45
0
0
0
0
40
Q' . p''
mkt share
35
700
0
30
25
mkt share
678
678
Q' . p''
1140
0
1110
1800
20
15
0
10
10%
5
P&purge
ContAtm
HeatTran
Cryo
Welding
0%
MRI
0.25
Cryo
- - Asia
China
S Korea
Japan
Stream influence?
Thailand
- - EU
UK 270
non-UK
- - US
Canada
US
- - ROW
S America
Africa
India
Aus/NZ
- - Russia
Russia
100%
stacked 100%
landed price scaling factor
ok Welding
$ / mcf
463
0
0
555
0
555
0
694
11
4
4
100
downstream px curve p=0.315*(vol factor)^(-0.9)
downstream price scaling
landed=1 vol factor px factor
1
0.01 19.87516
20
1
0.02 10.65083
1
0.03 7.394374
downstream px curve
18
1
0.04 5.70764
p=0.315*(vol factor)^(-0.9)
1
0.05 4.669147
landed price (=1.0)
16
1
0.06 3.962547
1
0.07 3.449231 Balloons
1
0.08 3.058648
14
1
0.09 2.751011
1
0.1 2.502134
12
1
0.11 2.296451
1
0.12 2.123476
10
1
0.13 1.975884
1
0.14 1.848397
8
0.15 1.737114
1
1
0.16 1.639089
6
1
0.17 AirWeath
1.552053
1Analysis0.18 LeakTest
1.47423
P&purge
Welding
1
0.19 1.404211
4
ContAtm
HeatTran
Cryo
0.2 1.34086
1
1
0.21
1.283256
2
1
0.22 1.230637
MRI
1
0.23 1.182376
0
1
0.24 1.137943
0
0.05
0.1
0.15
0.2
1
0.25 1.096894
0.26 1.05885 volume fraction in territory
0.27 1.023489
0.28 0.990532
0.29 0.959737
0.3 0.930897
0.31 0.903826
14
17
mkt share / relative revenue
100
3
2
2
1
Balloons
- - Total
1
1
1
players
meaning of colours
21.75
7.25
5
UPSTREAM DOWNSTREAM
3
0.315
FoHe
302.51
-0.9
1
Cryo
MRI px ok
playfactor Landed px table 10.1 compare
$ / mcf
$ / mcf
$ / mcf balloons bal / land
298
0.00
371 0
996
1.33
358
0.00
445 0
1195
1.60
1195
0.00
445 0
1.60
358
1494
2.00
447
0.00
556 0
Analysis
10
3
4
& model
AirWeath
Wyoming
US-other
Poland
17.0
major helium countries only are shown
consumer nations / regions
0.2
Country
percent
source $ ex-works shipping shipfactor
- - Asia
40
QA
200
10
1.12
China
20
QA
200
10
1.12
S Korea
8
200
10
1.12
Japan
10
QA
Thailand
2
QA
200
10
1.12
- - EU
20
5
1.06
UK
9
AL
200
non-UK
11
AL
200
5
1.06
- - US
24
CS
200
2
1.02
Canada
3
1.02
US
21
CS
200
2
- - ROW
9
S America
2
CS
200
10
1.12
AL
200
10
1.12
Africa
1
5
1.06
India
3
QA
200
Aus/NZ
3
AU
200
5
1.06
- - Russia
7
Russia
7
RU
200
5
1.06
LeakTest
Estimated global price ($/mcf)
200
producers / regions
localfactor
CS ex-works percent
200
33
1
AL ex-works
200
15
1
QA ex-works
200
25
1
RU ex-works
200
7
1
AU ex-works
200
3
1
result
calc
meaning of colours
0
MRI
Cryo
Welding
HeatTran
P&purge
ContAtm
LeakTest
Analysis
AirWeath
Balloons
market stream
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Industry thinking: MRI
GE MRI manufacturing facility, Florence, SC,
installing cryogenic helium recovery system
• Towards Zero Boil Off
• Inventory minimization
• Recycling and re-liquefaction
• Research: from NbTi to YBCO
Image credit: Sandy Andrews Photography
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TCE Article, Jan. 2014
• RH Clarke, WJ Nuttall, BA Glowacki
• Post-HSA2013 overview
• Much remains to be done…
• The world still needs He molecules
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Endangered elements?
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Industry thinking: analysis
Pharmaceutical, GC, leak detection, welding…
• Once-through applications
• Purity demands vary
• Research: recycling, transition to H2
and other gas mixtures
Image credit: Pharmtech.com / V. Pethe / A. Terentiev
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Industry thinking: aerospace
Pressure-fed rockets, SpaceX, Skylon…
• Purge, pressurisation, heat transfer
• Once-through and closed-loop
• Helium, an essential fluid for aerospace
Image credit: Reaction Engines / Scientific American
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Geography: US low-BTU
In US Midwest, helium has become a “drilling target”
• Harley Dome, UT, facility “operational”
• Extracts He (~7%) from N2
• Grade-A He, N2 vented, low BTU gas
• Similar projects anticipated
Trailer mounted N2 rejection skids
Image: IACX Energy
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Geography: Iran
*
Iran LNG
Iran LNG, South Pars Gas Field – potentially 350 Bcf He
Images: iranlng.ir (Apr.13) / theenergylibrary.com
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Geography: Eastern Siberia
Image: www.gazprom.com/f/posts/69/808097/easternprogram-map-en.jpg
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The politics of natural gas
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Helium Geo-centre
DEMO
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Geography: Australia
Central Petroleum indicate >100Bcf helium at
Mt. Kitty, NT. It is a long way to the market…
• Existing helium facility at Darwin LNG
Darwin
Mt. Kitty
Mt. Kitty
• 6% (sic) helium in NG reserves
• Early stage of development
Images: Australian Met Office / Central Petroleum
Image: Barry Dawes / NT government
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Geography: Algeria
• Hassi R’Mel NG ~0.19% He
• First He-from-LNG 1995
– Arzew #1 600 MMscf (APCI)
• Skikda Megatrain rebuilt
– 600MMscf (~8TPD)
– Ramping up production
• Longer term 2016
– Arzew #2 700 MMscf
• Italian NG contains 0.1% He!
eni.com/en_IT/attachments/sostenibilita/Snam-Rete-Gas-bilancio_2009_en.pdf
Skikda Helium JV Sonatrach-Linde
Image: Linde
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Impact of Algerian helium
• Hassi R’Mel field ~4400 Bcm x 0.19% He =
~30 years of global supply of helium
• Possible downside?
– NG operations disruption
– Field disruption
Storage? a salt
mine in Sicily?
Helium market modelling
(3% growth to 2030, 0.5% decline to 2081 then 3.2% decline)
Source: Cai et al., The Future of Helium as a Natural Resource (Routledge 2012)
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Conclusions
• Helium market is set to transform this decade
– Cliffside is being run down fast
– New plants and new extraction methods
– Worldwide geography changing
• There will be a strong ongoing demand for He
– 1 Supply needs to keep up with demand
– 2 Strategically assist technology developments
– 3 Improve extraction technologies
– 4 Develop regional helium policies (in EU)
Presentation prepared by Richard H Clarke
4He Solutions © 2014
[email protected]
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“Mind the gap”
4% market growth
Bcf
Surplus
8
Shortfall
Australia
6
Russia
Qatar
Poland
4
Algeria
Cliffside
2
Riley Ridge
Mid-USA
0
2005
2008
2011
2014
2017
2020
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Natural gas in Algeria
• To Skikda and Arzew LNG
plants ~30 Bcm/year
(from Hassi R’Mel)
• To Spain, Italy, Algeria etc.
~68 Bcm/year (He vented)
• Ongoing tie-ins: is He conc
reducing through blending?
Algerian gas supplies centred around He-rich
Hassi R’Mel field. Plans underway to run plant
with CSP (concentrating solar power)
– Nigerian interconnection
– Central Asian gas (to Italy)
– Algerian shale (17 Tcm?)
• Use of CSP for NG plant?
Sources: europeanenergyreview.eu, solarpaces.org, Schott AG and
royaldutchshellplc.com
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