KGOU

Oklahoma Expands Helium Production Amid Global Shortage

Jun 27, 2019

Amid a worldwide helium shortage, Canada-based Desert Mountain Energy Corp. is expanding helium production in Oklahoma. Journal Record editor Russell Ray also discusses how a multi-million dollar investment by aerospace company Pratt & Whitney will fund a major expansion of its military aftermarket services business in Midwest City. 

Full Transcript:

Katelyn Howard: This is the Business Intelligence Report, a weekly conversation about businesses in Oklahoma. I'm Katelyn Howard, and with me is Journal Record editor Russell Ray. This week, I'd like to discuss a couple of lofty ventures in the state which are helium and aerospace. Amid a worldwide helium shortage, your reporter Daisy Creager writes that Canada-based Desert Mountain Energy Corp. is expanding helium production in the Kight Gilcrease Sand Unit in Seminole County. Can you elaborate on helium production efforts in Oklahoma?

Russell Ray: You bet. Well, helium is a byproduct of a natural gas production, and as most people know, Oklahoma produces a lot of natural gas. Desert Mountain bought the oil and gas project in Seminole County for both its oil and helium resources. The company is now doing some testing to determine the quality and pressure of the helium and the natural gas. And right now, the company expects to begin commercial production by the end of this year.

Howard: Now, even though helium is the second most abundant element in the universe, shortages have continued worldwide for seven of the past 14 years.

Ray: That's right, Katelyn. There are many more applications for the use of helium today, and as a result, the demand has caused a shortage of supplies. Helium is used in a range of applications. It's not just for party balloons. It's used in MRI machines. It's used in the manufacturing of optical fiber. It's used in welding, and it's used to pressurize fuel tanks. The Hugoton Gas Field is the largest source of helium in the U.S. and covers parts of Oklahoma, Texas and Kansas, but that particular field has been significantly depleted after years of production.

Howard: Before we further discuss helium, can you explain how it's formed?

Ray: Yes. Helium is formed by the breakdown of radioactive elements. Helium atoms are lightweight, and they're very small. They work their way up through the Earth's crust and into the atmosphere most of the time. Some of the time however, they get trapped in tight rock formations, and over time, the atoms build up in these formations into extractable amounts.

Howard: And once it's formed, helium atoms are difficult to store due to their size and escape if there's even a small leak.

Ray: Yes. The amount of helium in the atmosphere is constant, but it is expensive to extract helium from the air. The number of sites where helium is produced is very few so if any one of those sites encounter production issues it can have a big impact on the market.

Howard: Now, helium is used in aerospace training as well, which is an industry I also want to touch on. In a recent article, your intern Christian Tabak writes that a multi-million dollar investment by aerospace company Pratt & Whitney will fund a major expansion of its military aftermarket services business in Midwest City. The expansion will support sustainment operations based out of the Oklahoma City Air Logistics Complex at Tinker Air Force Base. Can you tell us more about this?

Ray: Yes. With this latest expansion, Pratt & Whitney's presence in Oklahoma City will be 10 times greater than it was 15 years ago. At Tinker Air Force Base, Pratt & Whitney now supports more than a dozen engine types including the F135, F119 and F117. It's also important to note that Tinker's F135 fleet is expected to double within the next three years.

Howard: And this expansion will add more than 100 long term jobs, but this is just one example of the impact aerospace has had on the state's economic growth.

Ray: Well, that's right. Aerospace is the second largest growing industry in Oklahoma. Between 2017 and 2018, aircraft manufacturing added 3,800 jobs in the state. The manufacturing of aerospace parts and products added 4,400 during the same period. And since 2015, the Oklahoma Department of Commerce has assisted with business announcements from aerospace companies, totaling more than 7,000 new jobs and more than $700 million in planned capital investment.

Howard: Russell Ray is editor of The Journal Record. Thanks for your time today, Russell.

Ray: My pleasure, Katelyn. Thank you.

Howard: KGOU and The Journal Record collaborate each week on the Business Intelligence Report. This conversation, along with previous episodes of the Business Intelligence Report, are available on our website, KGOU.org. For KGOU and the Business Intelligence Report, I'm Katelyn Howard.

The Business Intelligence Report is a collaborative news project between KGOU and The Journal Record.

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