The 108th District Court in Potter County, Texas placed Cliffside Refiners, L.P. (CRLP) under receivership yesterday due to the continued deadlock among its partners regarding the operation and the future of its sole asset, the Crude Helium Enrichment Unit (CHEU).
The receiver was granted authority to operate the CRLP's business, including the authority to continue to allow Messer Helium Cliffside (MHC) to operate the CHEU as part of the former Federal Helium System located near Amarillo, Texas, now owned and operated by MHC.
The CHEU is the critical machinery that extracts helium from the Helium reservoir in Amarillo.
Without the CHEU, the Helium System would be forced down for several years until a new enrichment unit is built, cutting off access to privately owned helium that is stored in the System for numerous third parties.
Last month MHC filed a motion requesting the appointment of a receiver for the CRLP due to a continuing partner deadlock within the CRLP.
One partner, Air Products, has refused to allow the CRLP to negotiate or enter into a lease or other agreement with the Helium System's new owner, MHC, to continue operating the CHEU.
If the deadlock were to continue, the CRLP will be obligated to dismantle and remove the CHEU – its sole income-generating asset – and force a shutdown of the System, which could have significant repercussions on helium-dependent industries in the US and beyond.
MHC has invested significant, diligent efforts to overcome the deadlock, including active participation in court-ordered mediation, but has been unable to reach a reasonable commercial solution with Air Products.
By impeding MHC's right to operate the CHEU, Air Products could deprive numerous third parties' access to their privately owned helium stored in the System.
Despite the impediments Air Products has created, MHC is committed to work with the receiver to find constructive solutions to secure long-term, uninterrupted operation of the Helium System. At the same time, MHC remains open to proposals from the CRLP partners, even as the receivership is put into place.
Messer’s executive vice president for sales & marketing North America, Chris Ebeling, said the company supports the ruling.
"This is a positive development that will avoid disruption of the Helium System's operations," he said.
“Given all of the uncertainty due to heightened tensions in the Middle East, the continued war in Ukraine and sanctions against Russia, maintaining this vital US source is paramount."
MHC is committed to the ongoing, safe and reliable operation of the Helium System to facilitate continuous supply.
Messer is the largest privately held industrial gas business in the world and a leading industrial and medical gas company in North America, South America, Asia and Europe.
Messer Americas sales account approximately for 52 per cent of Messer worldwide sales of $US4.7 billion.