In recent years, China has implemented dual strategies to address the helium crisis, striving to break the monopoly of the United States and ensure diversified supply. Overseas supply sources need to be expanded to reduce dependence on the United States; Meanwhile, strengthening technological innovation and increasing local production are key. The dual approach has yielded results, and technological breakthroughs have added new colors. China's technological progress is remarkable. The demand for helium in a technological powerhouse has increased significantly, which was not apparent in China in the early years, but is now completely different.
The United States started early in the field of helium gas, with demand and utilization strategies far exceeding ours, and measures implemented earlier than ours. China and the United States have vastly different helium supply and demand: China's helium demand has surged, but reserves are limited; The United States, on the other hand, has abundant reserves and is adept at meeting demand.
Helium resources are distributed worldwide, with an estimated total of 49 billion cubic meters, and confirmed reserves of 7.6 billion cubic meters. The natural gas reserves of the United States, Afghanistan, Kazakhstan, and Russia are leading, with the United States taking the lead with over 40% of its total resources and over 50% of its reserves, highlighting the uneven distribution of resources.
Helium often coexists with natural gas, so countries with abundant natural gas resources often have considerable helium reserves. A hundred years ago, technology was not yet advanced, and the demand for helium was not as urgent as it is today. Countries did not foresee its precious value.
In the early years, natural gas was discovered in a certain area of the United States, but unexpectedly helium gas mixed in, making it difficult to ignite the natural gas. At that time, people were confused and mistakenly believed that the natural gas quality in the area was poor. After in-depth research by scientists, it was discovered that natural gas contains a special gas that became increasingly prominent and crucial during the 20th century technological leap in the United States. Due to its abundant natural gas resources, the United States mainly extracts helium from natural gas, resulting in a large-scale helium industry.
Why is helium scarce despite abundant natural gas in our country? The answers are complex and diverse, thought-provoking. China's helium resources account for only 2% of the global total, which is not only limited in quantity, but also has a relatively low proportion of low concentration helium. Zigong once attempted to extract helium from natural gas fields, but the production was extremely low, only 50000 cubic meters per year, and it had been stopped before 2004, twenty years ago. Since that year, the demand for helium gas in China has surged, and the supply relies heavily on imports. In 2020, the import volume reached 20.76 million cubic meters, while the domestic production was only 530000 cubic meters, highlighting the severe situation of external dependence.
The extreme shortage of helium supply highlights China's almost complete dependence on external imports, with an import rate of 97.5%, almost 100% of import demand. The demand for helium in our country has surged, and the phenomenon of supply exceeding demand has become prominent. Over the past decade, China has risen to become the world's second largest demand country, with annual demand skyrocketing from 5 million cubic meters to over 22 million cubic meters. We heavily rely on foreign imports, which makes the United States feel helpless in trying to restrain us.
In 2022, Chinese scholars expressed concerns that global helium resources and core extraction technologies are often monopolized by the United States. If it restricts exports to China, it may lead to a comprehensive supply crisis for helium gas in our country. China's helium mainly comes from imports from Qatar, which accounted for as much as 82% last year and is the main overseas supply source. The United States ranks second, providing up to 9% of imported helium gas to our country, followed closely by Australia with an 8% supply share.
Although the United States is not the largest source of imports, its leading technological strength in helium extraction cannot be ignored. If the United States takes extreme measures to balance our country in global trade, it will affect our trade activities importing from other countries and bring uncertainty. Faced with the urgent situation, we have independently accelerated resource exploration, strengthened technological breakthroughs, and continuously promoted progress in recent years.
The Tarim Basin beside the Hotan River is rich in helium, which indicates the birth of China's first large-scale helium gas field. The Weihe Basin is rich in helium gas and has broad prospects for mining. Sichuan, Qaidam, and Songliao basins also have significant potential for helium gas resource exploitation. Several confirmed areas are rich in helium gas, but its concentration is relatively thin, hovering between 0.1% and 0.3%. The high cost of mining is due to the difficulty in increasing concentration, but the good news is that significant technological progress was made in China at the end of last year, reducing the difficulty of mining.
The natural reserves of helium are not limited to natural gas, but also hidden in coalbed methane in coal. Coalbed methane is a non-traditional natural gas family, with a more complex composition than traditional natural gas, making the extraction of helium from it technically challenging. The helium extraction equipment developed last year has been successfully used in Haishiwan Coal Mine, which has rare coalbed methane resources and is rich in rare helium components in China.
Since 2021, the Research Institute of Coal Science and Industry Group has overcome difficulties and devoted itself to research and development in response to extraction challenges. After years of hard work, we have created a unique pressure swing adsorption fusion membrane separation and purification method, successfully solving the extraction problem. At the beginning of the year, using this technology, helium purification broke records with a purity of over 99.999%. Great success, opening up a new direction for subsequent helium research.
Not only did China successfully master the natural gas helium extraction technology last year, but it is also currently committed to researching and developing more advanced extraction technologies, striving to achieve new breakthroughs in this field. The purification of helium requires precise steps to complete. Although this method is mature and widely used in China, it has low helium content and high energy consumption, so it is imperative to explore efficient extraction methods.
The Institute of Process Engineering of the Chinese Academy of Sciences is making every effort to develop a new technology called membrane separation coupled with low-temperature adsorption. As of early last year, this technology has entered a critical breakthrough period. The research team stated that through the preliminary extraction of new technology, the purity of helium can reach 80%. Subsequently, high-purity helium gas can be produced through low-temperature deep processing. New technologies are attacking Guanzhong, striving to break through traditional limitations and significantly reduce extraction costs. Core challenge: Optimize separation membrane materials, solve plasticization problems, and address the aging phenomenon of materials under long-term use.
The basin with abundant helium reserves is about to introduce innovative extraction technology, paving the way for the application of new technologies. After overcoming the three major challenges, there will be no worries about future applications. After recovering helium gas, it can be recycled and reused through careful extraction and purification. This method is simpler than extracting from natural gas and the cost is also easy to control. The core challenge is that helium gas is highly prone to escape due to its low density. To achieve effective recycling, it is urgent to explore economically efficient process solutions and realize large-scale applications. Although technology is expected to make breakthroughs in the near future, practical applications still require time, and currently rely on overseas imports to meet demand.
With the continuous progress and innovation of domestic extraction technology, it is expected that our annual self production of helium will increase significantly, reaching about 40% of the total domestic consumption. According to predictions, by 2028, about 60% of China's helium demand may rely on overseas imports to ensure sufficient supply. Even if there is a leap in future technology, it is difficult to ensure 100% self supply. As long as the self-produced rate increases significantly and we are almost self-sufficient, we can rely on long-term reserves to get rid of the dependence dilemma. At that time, there was no longer any worry about suppliers raising prices arbitrarily.