Federal Helium System at Cliffside (2024)

13301 Brickplant Road
Amarillo, Potter County, Texas 79124

Announcements

1. Extension of Bidding Period for Federal Helium System Assets Sale

• The U.S. General Services Administration (GSA) has received an update from an independent third-party consultant regarding Helium and Natural Gas reserves in the Bush Dome (Brown Dolomite and Panhandle formations) as of August 31.
• This update, along with previous studies, has been added to the data room, offering valuable information to potential bidders interested in the sale of Federal Helium System Assets.

Important Dates

• Bidding period extension:
  • GSA has extended the deadline for receiving bids until January 23, 2024. The sealed bid opening date is January 25, 2024.
  • This extension allows potential bidders more time to evaluate the provided data, conduct due diligence, and prepare sealed bids. The IFB posted will be replaced shortly, so please check the GSA Auction website to download the new issue when it is posted.
• Objective:
  • The extension aims to ensure that all potential bidders can thoroughly assess the helium and natural gas potential in the Brown Dolomite and Panhandle formations, enabling informed competitive bids.
• Action for Potential Bidders:
  • Potential bidders are encouraged to review all available gas analyses and calculations.
  • Data room resources include previous annual Bureau of Land Management (BLM) field evaluations, such as reports from NITEC (2003), Edge (2018), NITEC (2018), Edge (2020), and Edge (2022).
  • Additionally, potential bidders are directed to the latest report, “Unlocking the Helium Vault: An In-Depth Look at Bush Dome Reservoir” by Edge Global Innovation (2023).

2.Litigation Update

On September 7, 2023 a lawsuit was filed to prevent the federal government from continuing with the sale of the helium system. On November 2, 2023, the Court issued a decision [PDF]. The operation of the federal helium system or delivery of helium continues as usual.

Opportunity

Lot 1 — Federally-owned crude helium gas only

• Approximately 1 Bcf of crude helium

Lot 2 — Federal helium system and 800 million cubic feet of crude helium

• 24,700 +/- sq. ft. Cliffside Gas Field Facility
• 38,314 +/- acres of gas interests
• 23 natural gas wells
• 423 miles of pipeline that distributes helium from Texas to Kansas
• 10.46 acre Kansas Satanta Maintenance Station
• 800 MMcf of crude helium
• 13,760 acres of gas storage rights for the Bush Dome (for injection)

The Federal Helium System currently supplies over 20% of the domestic and 9% of the global demand for helium by supplying crude helium to private helium refining companies, which in turn refine the helium and market it to consumers.

Helium is a colorless and odorless inert gas that will not burn or react with other elements. Helium is a non-renewable natural resource that is most commonly recovered from natural gas deposits. Perhaps the most familiar use of helium is the filling of party and parade balloons because it is a safe and non-flammable gas. In addition, helium is a critical component in many fields, including scientific research, medical technology, high-tech manufacturing (i.e. computer chips), space exploration, and national defense. Helium is used in MRI machines, specialized welding equipment, leak detection, fiber optics/semiconductor manufacturing, low-temperature research, missiles, and observation balloons.

Cliffside Gas Plant — The plant consists of two parcels totaling 8.108 acres of leased land (surface only) and federally owned building improvements that house the plant equipment associated with operating the helium enrichment process.

The improvements consist of 10 primary buildings of varying uses (office, warehouse, maintenance, shop, storage, equipment, and laboratory) ranging in size from over 1,000 square feet to under 5,000 square feet; over 20 smaller support buildings; and related site improvements (utilities, fencing, lighting, roads, parking lots, etc.). The buildings are mostly portable type or permanent metal construction built in the 1960’s and early 2000’s, although the Headquarters Building is of masonry construction.

Federally-owned plant equipment – The plant houses the equipment required to operate the helium enrichment process, which includes both federally owned and privately owned plant equipment that is integral to the process. The primary federally owned plant equipment consists of the booster compressor, natural gas chiller skid, metering equipment, spare parts, emergency generators, various storage tanks (fuel, air, water, NGL, etc.) and other equipment supporting the helium enrichment process.

While the Bureau of Land Management is responsible for the operation and minor maintenance of the Crude Helium Enrichment Unit (CHEU), the CHEU is owned by the Cliffside Refiners Limited Partnership. The CRLP is composed of four companies: Air Products, L.P.; Praxair, Inc.; Messer, LLC; and Kinder-Morgan. BLM has a lease agreement with CRLP for the privately owned equipment.

Mineral rights — From 1930 to 1942, the federal government acquired through purchase and condemnation more than 38,000 acres of gas interest (subsurface ownership).

Helium storage reservoir — The Cliffside Field includes the Bush Dome, a natural geologic formation of porous rock approximately 3,000 feet below the surface with two layers of calcium anhydrite covering the porous rock and acting as a lid to contain gas. The surface area of the Bush Dome encompasses approximately 12,000 acres.

The federally owned helium in the storage reservoir includes both federal helium that was injected into the reservoir for storage and the native helium commingled with the existing natural gas when the United States purchased the field. In addition, there is privately owned helium presently stored in the reservoir and pipeline.

Natural gas wells — The property includes 23 gas producing wells that were developed in the 1960s and 1970s. In addition to the well heads, the well equipment includes piping to the metering building and other related equipment.

Federal Helium Pipeline — The pipeline works in conjunction with privately owned refineries and BLM for the production, refinement, transmission, and storage of helium. The pipeline connects the Cliffside Field to private helium refiners spread throughout Northern Texas, the Oklahoma panhandle, and Southern Kansas. The federally owned portion of the pipeline stretches 423 miles and was installed in 1962. There are multiple privately owned spurs connected to the federally owned pipeline that serve private refineries. Both crude plants and refineries are connected to the pipeline. Crude plants (also called captured plants) only inject into the pipeline for delivery to a nearby refinery (usually associated with each other). Refineries can take from the pipeline and refine the crude helium into pure or grade A+ helium.

The pipeline easem*nts were acquired through purchase and condemnation in 1962 to provide for a minimum 50- to 60-foot-wide right-of-way to accommodate the pipeline.

An interactive map showing the locations of the easem*nts is available.

Satanta Maintenance Station — The maintenance station is located at 2089 Road HH at its intersection with U.S. Highway 56 approximately 1.5 miles northeast of Satanta, Kansas. The property consists of 10.46 acres of fee interest land improved with three buildings (office, garage/shop, and storage containing a total of 3,800 square feet), storm shelter, and site improvements (fencing, lighting, roads, and utilities). The buildings are of metal and masonry construction built in the 1960’s. This property serves as the maintenance station for the Federal Helium Pipeline, which passes through the site.

Additional information about the Federal Helium Program and the Federal Helium System can be found on the BLM website.

Photo gallery and virtual tours

Virtual building tours

Bidding process and information

Data room

The data room provides access to key due diligence information to help bidders prepare for the sale.

For Awareness: A lawsuit has been filed requesting to enjoin the federal government from continuing with the sale of the helium system. GSA will update this site with any decision made by a court or the agency that could affect the current Invitation for Bid (IFB). The operation of the federal helium system or delivery of helium continues as usual.

Pipeline easem*nts

The location of pipelines and easem*nts can be found in this interactive map. NOTE: All of the easem*nt acquisition documents described in the IFB and in the Data Room have not been uploaded to the GIS map. Please see the full easem*nt description in the IFB.

Key dates

• GSA has extended the deadline for receiving bids until January 23, 2024. The sealed bid opening date is January 25, 2024.

Invitation for Bid (IFB)

The IFB provides the property description, terms of sale, instructions to bidders, notices and covenants, and bidder registration and bid form. The IFB can be found on the GSA Real Property Disposition website and at RealEstateSales.gov.

Sale type

The sale type is sealed bid sale.

• The sale process allows for interested parties to bid on and potentially acquire the property in a transparent, expedited process.
• Interested parties are encouraged to review the IFB and tour the property.
• Bidders are required to post a bid deposit (refundable if not awarded the property). The required bid deposit is listed in the IFB.
• The property is being sold AS-IS, WHERE-IS. GSA has provided numerous due diligence documents on the property for review by potential bidders. The documents can be viewed in the Data Room.

Where to bid

GSA has extended the deadline for receiving bids until January 23, 2024. The sealed bid opening date is January 25, 2024. You can find detailed Instructions to Bidders in the Invitation for Bid.

Contacts

For details, inquiries or questions regarding property inspection

William Rollings, Realty Specialist,william.rollings@gsa.gov,817-978-4324

For media inquires

Rich Stebbins, GSA Regional Public Affairs Officer,R7media.inquiries@gsa.gov

Press Releases

Press Release (June 22, 2023): GSA Announces Upcoming Sale of Federal Helium System Assets
Press Release (November 3, 2023):New Study Released, Bidding Deadline Extended for Federal Helium System Assets