“A project regarding helium, which continues to be in short supply worldwide, in Siberia has started to get underway. Taiyo Nippon Sanso announced that on December 20, through its US affiliate Matheson Tri-Gas, a Memorandum of Understanding (MOU) was concluded with Gazprom Export, a subsidiary of Gazprom which is a natural gas company run by the Russian government, regarding the development of helium in Eastern Siberia.

Matheson Tri-Gas took over the trade rights of the former BOC in the US, Russia, and Poland. By operating a helium plant in the Orenburg area in Russia and engaging in sales, the company has a close relationship and has a long business with local helium sources and suppliers in Russia. Taiyo Nippon Sanso began negotiations with Gazprom Export for the development of helium in Eastern Siberia 3 years ago. Since then they have deepened exchanges each other. They have also been earning a trust from Gazprom with their know-how and technological cultivated for a long years through its years of supplying helium.

Taiyo Nippon Sanso too, places high hopes on the latent possibility of the Siberian product as a new source for helium which is expected to be in short supply not only in the immediate future, but also in the short to medium term. Of course, what will be happening from now on is linked to the progress Russia makes on the development of natural gas field. The amount of helium contained in the Siberian natural gas is not inferior to that of the US gas fields, so that it has been concluded that the business of commercialization of the helium will pay off quite nicely.

The Taiyo Nippon Sanso group will be talking repeatedly with Gazprom Export. It is looking toward going with one of the two options of participation in the production business or of obtaining the business rights.

The Taiyo Nippon Sanso group is not the only one making a bid for the source of helium in Eastern Siberia. The German firm Linde announced that on December 9 it had signed an MOU with Gazprom Export regarding the joint implementation of a production project in a helium gas field in the Eastern Russia. This production facility is due to be commissioned in 2018, with plans calling for Linde to take over the majority of the amount produced.

According to Linde, the helium production facility will be installed in the town of Belogorsk, 108 km northeast of Blagoveshensk, the capital of Amur Oblast (a federal subject of Russia). Belogorsk is connected to Vladivostok by the Trans Siberian Highway and the Siberian Railroad. The helium can be transported to Vladivostok with liquid helium containers for road and rail transportation, and then shipped out from there. Blagoveshensk is a boarder city located opposite the province of Heilongjiang, China. The plant is therefore also viewed as meeting the demand for helium in Northern China.

By the end of 2017 Gazprom plans to lay a natural gas pipeline from the Chayandinskoye gas field in Eastern Siberia to link Yakutia, Khabarovsk, and Vladivostok. The company will operate a facility to produce helium, along with the excavation and development of natural gas. The two companies are looking into other new helium projects in the Russian Far East.

As previously reported, in the Russian Far East, in addition to the Chayandinskoye gas field, Gazprom is also developing the Kovykta gas field. These two fields combined have the potential to produce an estimated 220 million m3 per annum. This is over twice the amount produced in currently in North America (83 million m3), making it quite possibly the largest helium source in the world.

Just as with the Bureau of Land Management (BLM) in the US, the excess will be stored underground. The amount required can be excavated, purified, and sold. According to Linde, they could become a reservoir to replace that of the BLM, where there is concern that the source might dry up.

Helium is in a situation of unprecedented shortage, due to the combination of the increase in the global demand mainly in Asia, and the disruption of production in the US. In 2013 the new source in Qatar will go into operation, but for Japan, which relies mainly on the US sources, the outlook is that procurement will become extremely hard amidst the expansion of demand in Asia. What is happening with helium production in Siberia which is geographically far closer than the US or the Middle East is certainly concerns Japan. Because of the severe geographical and climatic conditions of Siberia it is predicted that the construction of a gas pipeline and the transportation of gas will not go smoothly, so that what will be happening there will be closely watched.”