Australia’s only helium plant shuts down after gas supply for Darwin plant runs out

The only helium production plant in the southern hemisphere, located in Darwin, has shut down after its gas supply was exhausted.

BOC had been producing helium as a by-product from the Santos-owned Darwin LNG plant since 2010.

Santos has now temporarily closed the plant after its Bayu-Undan gas field was depleted, forcing BOC to also cease helium production.

In a statement, BOC — which is owned by multinational chemical company Linde — said it would “continue to supply Australian and New Zealand customers with imported helium sourced from several Linde plants overseas”.

While helium might be best known for its use in party balloons, the gas is crucial to MRI scanning machines in hospitals, and scuba diving and welding equipment, as well as in manufacturing solar panels and semi-conductor microchips.

Global helium consultant Phil Kornbluth said although Australia no longer had a local supply of helium there was little chance of a shortage of the gas. 

“The Australian market is still going to get its helium, it is just going to be imported,” Mr Kornbluth said.

“It will probably cost more than it would have cost if it was produced domestically simply because there is going to be more transportation cost involved.”

BOC’s Darwin helium plant produced about 3 per cent of the world’s helium supply, far behind the United States and Qatar — which dominate the global helium market.

“The Darwin plant had capacity of around 180 million feet per year of helium, which is several times more than the size of the entire Australian market,” Mr Kornbluth said.

“It supplied the majority of the Australian market, if not all — there was probably a little bit coming from outside Australia — and then the surplus [from the Darwin plant] was exported to Asian markets.”

Potential new helium resources

Santos is working to backfill its Darwin LNG plant with a new supply of gas, but its new gas field, Barossa, does not contain enough helium to viably extract, according to Mr Kornbluth.

BOC said it was “actively looking for new feed gas sources in the Northern Territory”.

Gas company Central Petroleum is investigating the viability of installing a helium recovery unit on its existing conventional gas wells in the Mereenie Basin.

“Helium is only produced at a handful of locations worldwide, so successful commercial production at Mereenie is likely to draw international attention to the unique and potentially vast helium resources of the Amadeus Basin,” Central Petroleum CEO Leon Devaney said in an August announcement.

Central Petroleum also has a joint venture with Santos to explore new helium resources south of Alice Springs.

Last month, Santos submitted environmental approvals to drill exploration wells in the Amadeus basin with hopes of finding natural gas and helium.

If the application is successful, the company is aiming to drill exploration wells in 2024.