Helium, a light, nonflammable, chemically inert gas, was first produced in Texas from the natural gases of the Petrolia oilfield, in Clay County, during World War I. Experimental plants were constructed in that area by the Bureau of Mines with funds allotted by the Army and Navy Departments to obtain nonexplosive helium as a replacement for the explosive hydrogen used in observation balloons and airships. Later, a large-scale plant was built in Fort Worth under the jurisdiction of the Navy Department, and operated for the government by the Linde Air Products Company.
On July 1, 1925, the government assumed control of all helium production in the nation. In 1927, the Bureau of Mines began negotiations for control of gas rights in fee on a 50,000-acre, helium-bearing natural gas structure known as the Cliffside Field, in Potter County near Amarillo. In 1928, the government began construction of a helium-extraction plant near Amarillo, which began production in April 1929. In that same year the Fort Worth helium plant closed because Petrolia supplies had been depleted. In 1934 the Bureau of Mines completed negotiations for the Cliffside helium field, and for a number of years the plant at Amarillo was the sole producer of commercial helium in the world. Texas produced 96,884,410 cubic feet of helium valued at $619,345 in 1944, and 69,808,454 cubic feet valued at $460,015 in 1945.
At the Amarillo plant natural gas is reduced to a temperature of about -300°F, at which point most components except helium liquify; the still-gaseous helium is drawn off. The natural gas, once restored to normal temperature, burns more readily and is sold to local gas companies. The entire process for each cubic foot of natural gas passing through the plant occupies less than one minute. Helium is shipped under pressures of 1,800 to 2,000 pounds per square inch in small containers or specially designed tank cars. One thousand cubic feet of the 98.2 percent pure helium produced at Amarillo could lift approximately 64½ pounds.
Beginning in 1937 the Bureau of Mines was authorized to sell helium to private concerns for medical, scientific, and commercial use. In 1939 it sold for $13 to $15 per thousand cubic feet. In addition to its main use in floating balloons and airships, helium has been used in a mixture with oxygen to relieve asthma and other respiratory diseases, for welding magnesium, aluminum, and stainless steel, and in radio tubes, electrical searchlights, and deep-sea diving equipment.
In 1964, an estimated 95 percent of the world's recoverable helium was produced within a 250-mile radius of Amarillo. Three new plants, which began operating in that year, doubled existing capacity, resulting in refined helium production of 304,909,000 cubic feet valued at $10,672,000, and crude production of 1,751,924,000 cubic feet valued at $18,812,000. In 1968 helium was extracted from natural gas at federal plants in Amarillo and Exell in Moore County, and at two Phillips Petroleum privately owned plants in Moore and Hansford counties. Refined helium production in Texas in 1968 stood at 365,000,000 cubic feet, valued at $9,560,000, and crude production at 1,043,700,000 cubic feet, valued at $11,428,000. Crude unrefined helium was placed in underground storage for conservation purposes at the government's Cliffside gas field near Amarillo. By the time the helium industry celebrated its centennial at Amarillo in 1968, Potter County was the "Helium Capital of the World."
In 1970 four extraction plants operated in Texas, including two Bureau of Mines plants and two Phillips Petroleum Company plants in Moore and Hansford counties. The bureau's Amarillo plant shut down that year, but the Exell plant was modernized. In 1970 high-purity helium production totalled 141,000,000 cubic feet, valued at $4,917,000, and crude helium production 1,190,000,000 cubic feet, valued at $13,053,000. Production declined from 1974, when crude helium production dropped to 35,000,000 cubic feet valued at $420,000 and no pure helium production was reported, until 1980, when high-purity helium production, the only kind reported, totalled 38,000,000 cubic feet valued at 874,000. In 1990, when helium was used in cryogenics, leak detection, and synthetic breathing mixtures, production estimates were no longer recorded, as output and value of crude helium plummeted, and helium in Texas was recovered chiefly by Air Products and Chemicals, Incorporated, in Hansford County. Trend watchers in the industry, however, anticipated increased production to supply the demand created by the development of new high-tech products.
In mid-1993, a controversy arose when the Bureau of Mines continued to stockpile helium at a time when the government sold only about 10 percent of the helium it produced, and raised its prices to a point that allowed private helium producers to sell at lower prices. Others questioned the bureau's helium policy after it borrowed $252 million in 1960 in response to fears of shortages spawned by the nation's growing space program. Though it claimed the figure was meaningless since the government simply owed money to itself and the General Accounting Office had agreed the debt should be cancelled, the Bureau of Mines was responsible for $1.3 billion of the national deficit by 1993 as interest accrued. To complicate the issue further, private interests claimed that if the debt was forgiven, government-produced helium could then be sold cheaper than privately produced helium.