[Congressional Record Volume 140, Number 24 (Tuesday, March 8, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: March 8, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
            IT'S TIME TO DEFLATE THE FEDERAL HELIUM PROGRAM

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                         HON. RICHARD H. LEHMAN

                             of california

                    in the house of representatives

                         Tuesday, March 8, 1994

  Mr. LEHMAN. Mr. Speaker, today, I am pleased to join the 
distinguished chairman of the Committee on Natural Resources, 
Representative George Miller, and the ranking member of the 
Subcommittee on Energy and Mineral Resources, Representative Barbara 
Vucanovich, in offering the Helium Act of 1994, a bill to reform the 
Federal Helium Program.
  While most people may associate helium with balloons and blimps, it 
is also used in the space shuttle program, in star wars research, for 
cryogenics and magnetic resonance imaging.
  The Federal Government got involved in producing helium during World 
War I, when the Army and Navy became interested in using it for 
dirigibles and blimps. Congress then passed the Helium Act of 1925 
which created the Federal Helium Program. Later, concerns that helium 
supplies were tapering off prompted Congress to replace the 1925 act 
with the Helium Act Amendments of 1960.
  The 1960 act was intended to encourage conservation of helium and to 
assure that supply sufficient to meet the current and foreseeable 
future needs of the Federal Government would be available. The law 
authorized the Secretary of the Interior to buy helium from private 
supplies and store it for use by the Federal Government in federally 
owned plants and related storage facilities. The act also encouraged 
private industry to participate in helium recovery as previously, the 
Federal Government had been the only domestic helium producer.
  During the following decade, the Bureau of Mines contracted with 
private companies to supply helium to the Federal Government. To 
finance purchases, the Bureau of Mines borrowed $252 million from the 
Treasury, mistakenly believing that future sales would recover the 
loan.
  Currently, 32 billion cubic feet of helium is stockpiled in an 
underground dome northwest of Amarillo, TX. Meanwhile, the helium debt 
has risen to $1.4 billion--most of which is interest. Although required 
to refund this debt by 1995, there is no prospect of repayment.
  The Bureau of Mines helium program began as an effort to assure the 
Government of an adequate supply of helium at a time when there was no 
private helium production. After the Government raised its prices in 
concert with taking out loans to pay for its purchases, production of 
helium became cost-effective and a private sector emerged. Today, the 
private sector produces 90 percent of the helium consumed in the 
country.
  The United States is the world's major producer and consumer of 
helium, using 2.16 billion cubic feet per year. The total sales value 
of domestic consumption and exports of refined helium in 1992 was $180 
million--of which the Government produced $18 million. Domestic 
production came from the Government plant in Amarillo and 11 privately 
owned plants--4 in Kansas, 4 in Texas, 2 in Wyoming, and 1 in Colorado.
  Because, Federal agencies are required to purchase helium from the 
BuMines, the Government continues to operate the helium recovery and 
purification facility in Amarillo, TX. Unfortunately, these facilities 
are outmoded, in need of constant repair, and are not nearly as 
efficient as private facilities. For example, at the Federal plant, 
over 40 people are employed for maintenance as opposed to 4 at a nearby 
private facility.
  The original reasons for creating the program have been met. For 
example, a strong private helium industry has emerged that can meet 
Federal needs in the absence of a Federal program. Both the General 
Accounting Office and the inspector general of the Department of the 
Interior have supported reform of the helium program.
  In response to concerns raised by a number of colleagues about the 
helium program, as well as public interest groups such as the Taxpayers 
Union, the Subcommittee on Energy and Mineral Resources conducted an 
oversight hearing on the helium program on May 20, 1993. In addition, 
during the past several months, I have met with a number of individuals 
about the need to reform the program. Subcommittee staff have visited 
the Federal facilities and a private facility. As a result, I have come 
to the inescapable conclusion that changes to the Helium Act are 
warranted.
  Briefly, our legislation relieves the Bureau of Mines of its helium 
duties with the exception of several specific responsibilities which I 
believe are appropriate for the Federal Government to carry on. The 
Cliffside Reservoir and the pipeline associated with it would be 
maintained by the Bureau of Mines. Monitoring and associated research 
related to domestic helium resources would continue. However, the 
Federal Government would get out of the helium refining and production 
business. Federal agencies would be allowed to purchase helium from the 
lowest bidder. The stockpile would be maintained until 2014 to allow 
other reserves to be depleted and to ensure that Federal helium will 
receive the optimum price when sold and that such sales will not 
disrupt the private market.
  The Subcommittee on Energy and Mineral Resources will hold a hearing 
on this legislation in April.

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