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Ms. JACKSON LEE. Mr. Chair, I rise today in support of H.R. 527, the "Responsible Helium Administration and Stewardship Act,'' which will renew the Department of the Interior's (DOI) authority to continue operating the Federal Helium Reserve beyond this fiscal year.
I want to thank Chairman HASTINGS and Ranking Member MARKEY for their hard work in shepherding this legislation, which enjoys strong bipartisan support, to the floor.
Mr. Chair, I support H.R. 527 because it is an important first step in updating our nation's helium policy by increasing transparency and fostering competitive helium markets, while providing a better return for American taxpayers.
Currently, the United States is the largest helium producer in the world. The most recent data from the United States Geological Survey indicates that at over 20 billion cubic meters, the total helium reserves and resources of the United States represents roughly 40 percent of the world's helium supply.
Helium is primarily used in magnetic resonance imaging (MRI) devices in hospitals, but is also used as a coolant for superconductors, as well as in cryogenics, welding, chromatography, and various other uses.
The Federal Helium Reserve is a strategic reserve located at the Cliffside Storage Facility in Potter County, Texas, near the city of Amarillo. Created in 1925, its original function was to ensure supplies of helium to the federal government for defense, research, and medical purposes.
Through the Helium Privatization Act of 1996, the Federal Helium Reserve evolved to serve four purposes: (1) operating and maintaining a helium storage reservoir and pipeline system view map; (2) providing crude helium gas by contract with private companies; (3) evaluating the Nation's helium-bearing gas fields; and (4) providing responsible access to federal land for managed recovery and disposal of helium.
While the Interior Department currently has the authority to continue funding and operating the Federal Helium Reserve, this authority is set to expire at the end of this fiscal year. Upon expiration, and absent Congressional action, our national supply of helium faces severe turmoil in the form of substantial price increases and market disruptions for American consumers and businesses.
Moreover, the Federal Helium Reserve, which constitutes a large portion of the global supply, is instrumental in controlling price. The large quantity of helium in the reserves means that the Interior Department effectively determines prices paid for helium around the world.
Numerous reports indicate that the Interior Department may be selling helium at below market value, which may have the effect of stifling private investment in new helium supplies. As a result, we risk facing a shortage in coming years as helium supplies diminish.
H.R. 527 addresses this problem by transitioning helium sales to a competitive auction system, thus ensuring a steady supply of helium and allowing users to bid on crude helium from the reserve. Consequently, the law of supply and demand would dictate price rather than having the price controlled by a central authority.
Ideally, I would have liked to see more discretion afforded to the Secretary of the Interior in this bill, particularly with respect to the minimum price charged for crude helium.
The bill requires the Secretary to make a determination as to the minimum sale price at auctions in accordance with various factors, including a confidential survey of domestic helium transactions with the reserve, as well as recent market prices as reflected by auction sales.
Currently under the bill, the Secretary would have the discretion to adjust the minimum price by up to 10 percent if the survey is not reflective of the current market value of helium or if a higher minimum price may result in greater conservation of helium.
However, market fluctuations in recent years have often been in excess of 10 percent. Providing the Secretary with greater discretion to adjust the minimum price in accordance recent trends is desirable to ensure that prices track market value as closely as possible.
In my view, the bill would be improved if the Secretary's discretion were enlarged to authorize adjustments to the minimum price by an amount not to exceed 20 percent.
But taken as a whole, H.R. 527 is a positive step in the right direction. And I want to express my appreciation again to Chairman Hastings and Ranking Member Markey for their good work.
Mr. Chair, I urge my colleagues in joining me in voting for H.R. 527, ``Responsible Helium Administration and Stewardship Act.''
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