Innovation gas: Why would Russia produce helium?

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Moscow, 1 October 2012 – As science and technology develop, we will see new, highly effective technologies making use of helium as a raw material. Interest in this resource should grow considerably as a result. Even today, there is a steady trend on the world market toward growth in helium consumption, which is proved by the results of the latest research conducted by EY to investigate this unique strategic resource. Helium is increasingly being used in astronautics and aviation, medicine and shipbuilding, chemical production and metallurgy, the nuclear industry and cryogenic systems and in many other areas.

Russia has substantial reserves of helium-containing raw materials, most of which are concentrated in Eastern Siberia. No companies have as yet undertaken full-scale development of these gas fields, and, thus, the key task today is to determine the viability of recovering these helium reserves. The research "Innovative gas: Why would Russia produce helium?" is an attempt to estimate the possibilities for Russia to domesticate foreign experience by the US case study, as US has been the dominant player during a long time, controlling over 50% of the world helium market. The US has major reserves of high-quality helium raw material with a helium concentration of over 0.5%. Qatar and Algeria have only recently begun to develop their helium industry.

As a global leader in terms of helium resources contained in natural gas deposits, Russia needs to take a more well-considered approach to the extraction and sale of helium as a nonrenewable resource used in scientific, innovative and hi-tech developments. In the European regions of Russia, the helium content in natural gas deposits is negligible – from 0.05% to 0.06%. Gas deposits with a helium content from 0.1% to 0.25% in the western regions have been nearly depleted (in particular, this refers to Saratov Region and the Komi Republic). Meanwhile, gas deposits in Orenburg Region, where the helium content in natural gas is approximately 0.055%, continue to supply this valuable raw material to consumers not only in Russia, but also abroad.

Development of the Russian helium industry depends largely on the economic appeal of this market niche. This will require a consideration of all possible economic factors, including state support and the development of demand on the part of domestic consumers (the main consumers, as mentioned earlier, are hi-tech industries to be developed). Primarily, the development of regulations on helium extraction, production and distribution is needed. In addition, it is high time to devise a strategy for developing and protecting gas and helium resources, clearly defining the role and place of the state, private Russian and foreign business, the forms of their interaction and partnership and the regulatory framework for measures to rationally utilize and maintain helium reserves.

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