Support Competition and Free Markets: Vote NO on the Dent Amendment


WASHINGTON, D.C., April 26, 2013 -

Support Competition and Free Markets:
Vote NO on the Dent Amendment

Dear Colleague,

As you prepare for the vote on the Dent Amendment, we wanted to share with you the below letter from three companies who are ready and prepared to engage in the new helium program established by HR 527. These three helium distributors, Airgas, American Air Liquide, and Matheson Trigas, are all interested in competing for and engaging in the sale of helium from the Federal Helium Reserve. The Dent amendment would significantly impede their ability to do so. Although these three companies are direct competitors with each other, they have joined together in opposition to the Dent Amendment.

The increased competition and free-market auctions provided for in H.R. 527 will help generate a greater return for the Federal Treasury and incentivize the development of alternative helium supplies. We urge you to oppose the Dent Amendment.

Please join us in voting NO on the Dent-Higgins-Esty Amendment.

Sincerely,

Doc Hastings (WA-04)                                                      Rep. Ed Markey (MA-05)
Chairman                                                                          Ranking Member
House Committee on Natural Resources                          House Committee on Natural Resources  

Rep. Bill Flores (TX-17)                                                    Rep. Rush Holt (NJ-12)
House Committee on Natural Resources                          House Committee on Natural Resources

For more information, please contact Tim Charters with the Natural Resources Committee Majority Staff or Morgan Gray with the Natural Resources Committee Minority Staff if you have any questions.


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April 25, 2013

Re: Opposition to the Dent Amendment to H.R. 527, the Responsible Helium Administration and Stewardship Act

Dear Chairman Hastings and Ranking Member Markey:

We the undersigned—Airgas, American Air Liquide, and Matheson Trigas (“Non-Refiners”)—write to express our concerns about the amendment being offered by Rep. Charlie Dent (R-PA). Collectively, we serve a substantial portion of the end-user market in the U.S. While our companies have differing views on the various provisions of H.R. 527, we are united in our opposition to the Dent amendment. We strongly urge its defeat.

Under current law, three large companies (the helium “Refiners”) have almost exclusive access to the helium in the Federal Helium Reserve. Since new legislation is needed in order for the Federal Helium Reserve and pipeline to continue operations, H.R. 527 makes changes that would open up access to the Reserve, thereby increasing market forces and increasing the return to the U.S. taxpayer on the helium sold from the Reserve. The Dent amendment, on the other hand, perpetuates the status quo, giving the three Refiners a continuing distorted market advantage over others in the industry that would not exist in a free market. It undermines the goals we all share—ensuring a stable and reliable helium supply, increasing access to the Federal Helium Reserve, and providing an appropriate return to the U.S. taxpayer on a taxpayer-owned resource.

The Dent amendment is very broadly worded and gives the Refiners far greater protections than currently provided for in their existing contracts with BLM. By strengthening these contracts and perpetuating them for years to come, the Dent amendment essentially renders meaningless H.R. 527 because the contracts—as extended by this language—will largely prevent BLM from delivering product to anyone other than Refiners. Thus, even if a Non- Refiner could purchase crude helium in an auction, the Non-Refiner will not be able to take delivery.

By strengthening and extending these contracts for many years into the future, the Dent amendment leaves in place the same anti-competitive system that the DOI Inspector General determined in 2008 potentially cost taxpayers more than $100 million.

For the same reasons, even expressly limiting the Dent amendment to extending all contracts through 2015, as the Dent amendment’s description incorrectly states, should be rejected. Any delayed implementation of H.R. 527—which already contains a grace period—provides more time to draw down the taxpayer-owned resource by the same three companies who have enjoyed almost exclusive access for nearly 20 years and reduces the return to U.S. taxpayers.

Through the 1996 Helium Privatization Act which governs the operation of the Reserve and pipeline system today, Congress intended the Federal Helium Reserve to end in 2014.

Therefore, Refiners had no expectation that contracts would run beyond that date. Moreover, the BLM standard contract states that contract performance is contingent upon acts of Congress. The Dent amendment perpetuates the closed market that has benefitted the Refiners for many years at the expense of the American taxpayer. This is antithetical to the open access and market transparency goals of the bill, as well as the recommendations of numerous studies by the General Accounting Office and the National Academy of Sciences.

For these reasons, we urge the defeat of the Dent amendment.

Sincerely,

Airgas, American Air Liquide, and Matheson Trigas




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