Jan. 26 (UPI) — The sale of the Federal Helium Reserve to the highest private bidder Thursday could have a huge impact on healthcare and disrupt hospital supply chains and even semiconductor chip manufacturing.
The winning bidder of the auction Thursday hasn’t been publicly identified.
A major concern in the health industry is MRI machines that need helium to function, threatening not just hospital supply chains but individual healthcare for patients who need MRIs.
It’s also an essential ingredient in semiconductor chip manufacturing, so the sale of the reserve would impact anyone using those chips.
Soumi Saha, a senior vice-president of Premier Inc. said an existing helium supply shortage may get worse as regulatory and logistical issues could cause a temporary shutdown of the existing federal supply while it transitions to private ownership.
“We are stressing about this shortage. From a health care perspective, MRI machines are the No. 1 concern,” Saha said.
Premier Inc. contracts with helium suppliers to supply hospitals.
The massive federal stockpile of helium spans three states and about 6 billion cubic feet of helium is held underground in the Bush Dome.
A 1996 law — the Helium Privatization Act of 1996 — forced the sale of nearly all the 30 billion cubic feet of helium held in the Bush Dome and pegged the cost not at market rates, but at the annual inflation rate.
Private companies bought it and resold it at higher prices. The auction this week puts the remainder in private hands.
Bo Sears, author of Helium: The Disappearing Element, told Texas Monthly, “It is this formula of pricing that has caused all of the shortages that we see today.”
Since just a few countries produce helium, the element is in relatively short supply.
The sale of the federal helium reserve prompted Scott Whitaker, president and CEO of AdvaMed, the Medtech Association, to urge the White House to delay the final sale and privatization of the helium reserve.
“Helium is critical to the function and operation of key medical technologies patients rely on for their care,” Whitaker said in a statement.
“For example, it’s used to cool the magnet in magnetic resonance imaging machines. American patients receive an estimated 40 million MRI scans each year to help diagnose strokes, tumors, brain injury, spinal cord injury and heart problems.”
Advamed joined the Semiconductor Industry Association, Compressed Gas Association, the Aerospace Industries Association and the Medical Imaging and Technology Alliance to warn the federal government in October that selling the helium reserve carried a significant risk.
“The FHR sale as the General Services Administration has proposed it poses significant risks of disruption to the United States helium supply chain,” they wrote in a joint letter.
“We urge the White House to intervene and delay transfer of the FHR until the transfer of the facility can be done in a manner that maintains the safety of the facility and the reliability of the helium supply chain.”
While the winner of the auction hasn’t been announced, Messer, a company that helps manage the Cliffside plant on the reserve, could be the highest bidder.
According to Compressed Gas Association CEO Rich Gottwald, several issues related to logistics and regulation in Texas, Oklahoma and Kansas as the helium reserve goes private could force a shutdown of the facility for as long as three years.
One of those issues is enrichment of the helium. The new owner of the helium reserve would have to lease enrichment facilities from other private companies that own the enrichment system.