How Much Natural Gas Do We Have to Replace Gasoline?
How Much Natural Gas Do We Have to Replace Gasoline?
Posted by Robert Rapier on July 30, 2009 - 10:06am
Topic: Alternative energy
Tags: gasoline, natural gas [list all tags]
You may have seen the recent news that a report by the Potential Gas Committee says natural gas reserves in 2008 rose to 2,074 trillion cubic feet. The New York Times and the Wall Street Journal (via Rigzone) both had stories on it, and T. Boone Pickens issued a press release. In this post, I will look at how long these reserves might last, if used to replace US gasoline usage.
How Much Do We Need?
The U.S. currently consumes 390 million gallons of gasoline per day. (Source: EIA). A gallon of gasoline contains about 115,000 BTUs. (Source: EPA). The energy content of this much gasoline is equivalent to 45 trillion BTUs per day. The energy content of natural gas is about 1,000 BTUs per standard cubic foot (scf). Therefore, to replace all gasoline consumption would require 45 billion scf per day, or 16.4 trillion scf per year. Current U.S. natural gas consumption is 23 trillion scf per year (Source: EIA). Therefore, replacing all gasoline consumption with natural gas would require a total usage of 39.4 trillion scf per year, an increase in natural gas consumption of 71% over present usage.
Assuming for the sake of argument that the 2,074 trillion standard cubic feet cited in the study is accurate, that the "probable, possible and speculative reserves" eventually equate to actual reserves, and that the gas is economically recoverable, that is enough gas for 53 years of combined current natural gas consumption and gasoline consumption. If you assume that only the proven plus probable reserves are eventually recovered, the amount drops to about 1/3rd of the 2,074 trillion scf estimate, still enough to satisfy current natural gas consumption and replace all gasoline consumption for almost 20 years.
We can also calculate in terms of oil imports. Right now the U.S. imports about 13 million barrels per day of all petroleum products. A barrel of oil contains around 5.8 million BTUs, but oil only makes up 10 million of the 13 million barrel per day figure. Other imports include things like gasoline (4.8 million BTUs/bbl) and ethanol (3.2 million BTUs/bbl). Scanning the list of imports, I probably won't be too far off the mark to presume that the average BTU value of those 13 million bpd of imports is about 5.4 million BTUs/bbl. On an annual basis, this equates to 25.6 trillion scf of natural gas, which would be an increase over current natural gas usage of 111%. Going back to the 2,074 trillion scf from the study, this would be enough to displace imports of all petroleum products (again, at current usage rates and not factoring in declining U.S. oil production) for 43 years.
What's the Cost?
Natural gas is presently trading at about $4 per million (MM) BTU (although December 2009 is trading at almost $6). Oil is presently trading at $71/bbl, which equates to $12.24/MMBTU. Gasoline is presently trading at over $17/MMBTU. Thus, natural gas is a bargain relative to oil or gasoline. Incidentally, I just checked on seasoned wood and wood pellets, and they range from $8-$12/MMBTUs. So it is cheaper to heat your house with gas than with wood. I am not sure I would have guessed that.
While natural gas is a bargain relative to gasoline, converting a gasoline-powered vehicle to natural gas isn't cheap. According to this source, it can cost $12,500 to $22,500 to convert a gasoline-powered car to natural gas. Honda makes a compressed natural gas (CNG) vehicle, but according to this review in Car and Driver the premium over the gasoline version is $8,780. A person would need to drive an awful lot to justify that premium. However, that's what fleets do. They drive a lot. The large price differential explains why fleets would be interested in running their vehicles on natural gas.
Conclusions
So, the good news is that the United States could be energy independent if the newly released natural gas reserve numbers are remotely accurate. It also appears that we have enough natural gas available that civilization isn't going to end any time soon due to lack of energy supplies. There are three caveats. First, energy independence via natural gas could require us to spend significantly more for personal automotive transportation. Second, "possible" reserves may never materialize. Finally, a large chunk of the calculated reserves are based on shale gas, and that requires gas to be in the $6-$8/million BTU range to be economical. Still, it is a bargain compared to gasoline, and it explains why fleets are more receptive to conversion to natural gas than the general public is likely to be for their personal vehicles.
(complete article-It is one persons look at how much natural gas would be required to replace the gasoline we are using today.)
http://www.theoildrum.com/node/5615
Posted by Robert Rapier on July 30, 2009 - 10:06am
Topic: Alternative energy
Tags: gasoline, natural gas [list all tags]
You may have seen the recent news that a report by the Potential Gas Committee says natural gas reserves in 2008 rose to 2,074 trillion cubic feet. The New York Times and the Wall Street Journal (via Rigzone) both had stories on it, and T. Boone Pickens issued a press release. In this post, I will look at how long these reserves might last, if used to replace US gasoline usage.
How Much Do We Need?
The U.S. currently consumes 390 million gallons of gasoline per day. (Source: EIA). A gallon of gasoline contains about 115,000 BTUs. (Source: EPA). The energy content of this much gasoline is equivalent to 45 trillion BTUs per day. The energy content of natural gas is about 1,000 BTUs per standard cubic foot (scf). Therefore, to replace all gasoline consumption would require 45 billion scf per day, or 16.4 trillion scf per year. Current U.S. natural gas consumption is 23 trillion scf per year (Source: EIA). Therefore, replacing all gasoline consumption with natural gas would require a total usage of 39.4 trillion scf per year, an increase in natural gas consumption of 71% over present usage.
Assuming for the sake of argument that the 2,074 trillion standard cubic feet cited in the study is accurate, that the "probable, possible and speculative reserves" eventually equate to actual reserves, and that the gas is economically recoverable, that is enough gas for 53 years of combined current natural gas consumption and gasoline consumption. If you assume that only the proven plus probable reserves are eventually recovered, the amount drops to about 1/3rd of the 2,074 trillion scf estimate, still enough to satisfy current natural gas consumption and replace all gasoline consumption for almost 20 years.
We can also calculate in terms of oil imports. Right now the U.S. imports about 13 million barrels per day of all petroleum products. A barrel of oil contains around 5.8 million BTUs, but oil only makes up 10 million of the 13 million barrel per day figure. Other imports include things like gasoline (4.8 million BTUs/bbl) and ethanol (3.2 million BTUs/bbl). Scanning the list of imports, I probably won't be too far off the mark to presume that the average BTU value of those 13 million bpd of imports is about 5.4 million BTUs/bbl. On an annual basis, this equates to 25.6 trillion scf of natural gas, which would be an increase over current natural gas usage of 111%. Going back to the 2,074 trillion scf from the study, this would be enough to displace imports of all petroleum products (again, at current usage rates and not factoring in declining U.S. oil production) for 43 years.
What's the Cost?
Natural gas is presently trading at about $4 per million (MM) BTU (although December 2009 is trading at almost $6). Oil is presently trading at $71/bbl, which equates to $12.24/MMBTU. Gasoline is presently trading at over $17/MMBTU. Thus, natural gas is a bargain relative to oil or gasoline. Incidentally, I just checked on seasoned wood and wood pellets, and they range from $8-$12/MMBTUs. So it is cheaper to heat your house with gas than with wood. I am not sure I would have guessed that.
While natural gas is a bargain relative to gasoline, converting a gasoline-powered vehicle to natural gas isn't cheap. According to this source, it can cost $12,500 to $22,500 to convert a gasoline-powered car to natural gas. Honda makes a compressed natural gas (CNG) vehicle, but according to this review in Car and Driver the premium over the gasoline version is $8,780. A person would need to drive an awful lot to justify that premium. However, that's what fleets do. They drive a lot. The large price differential explains why fleets would be interested in running their vehicles on natural gas.
Conclusions
So, the good news is that the United States could be energy independent if the newly released natural gas reserve numbers are remotely accurate. It also appears that we have enough natural gas available that civilization isn't going to end any time soon due to lack of energy supplies. There are three caveats. First, energy independence via natural gas could require us to spend significantly more for personal automotive transportation. Second, "possible" reserves may never materialize. Finally, a large chunk of the calculated reserves are based on shale gas, and that requires gas to be in the $6-$8/million BTU range to be economical. Still, it is a bargain compared to gasoline, and it explains why fleets are more receptive to conversion to natural gas than the general public is likely to be for their personal vehicles.
(complete article-It is one persons look at how much natural gas would be required to replace the gasoline we are using today.)
http://www.theoildrum.com/node/5615
Tags: CNG, gas, gasoline, natural, transportation
Views: 87
Replies to This Discussion
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Permalink Reply by sesport on -
jffree - This EIA chart of gas reserves (which was taken from a link to the EIA through a link to the Potential Gas Committee in the article) only shows gas reserves through 2007. I'm not sure if this includes the newer shale discoveries or not.
http://tonto.eia.doe.gov/dnav/ng/ng_enr_sum_dcu_NUS_a.htm
If the reserves used in the author's calculations are current, to include the newer shale plays, then his argument may be valid. Otherwise, recalculation may be in order when the data is updated.
:0)
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Permalink Reply by jffree1 on
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sesport, I think he may have gotten ahold of your creative liscense...
"Assuming for the sake of argument that the 2,074 trillion standard cubic feet cited in the study is accurate, that the "probable, possible and speculative reserves" eventually equate to actual reserves, and that the gas is economically recoverable..."
Those are all really big IFs. He goes on to say that if you take out the purely speculative "reserves" we could replace gasoline with natural gas for about twenty years.
Here is what I am wondering: How many wells (new production at what average mcf per well) would it take per year to replace our annual gasoline usage (in addition to what we use annually for home heating, industry & power generation)? He put everything into MBTU and BBTU which is fine, as far as it goes (I can't think in numbers that large). I want to know, how many wells (in the real world, on the ground) would have to come online each year to git 'er done? I think that would have to take into account replacement for declines from existing fields as well as new production over and above that replacement figure? An approximation (or even a wild guess) would suit me just fine.
Until gas reaches a price that makes drilling gas wells profitable, any discussion of replacing gasoline with natural gas is ALL speculation.
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Permalink Reply by sesport on
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jffree - Okay, I think I'm getting there.
This draft document from 2007 shows that approximately 40 gas equivalent gallons (gge) of ng will be needed for light duty vehicles only by 2010. (see chart p. 3) And by 2030, approximately 100 gge of nat gas is projected (and thus speculated) to be needed by the year 2030.
http://www.energy.ca.gov/ab1007/documents/2007-05-31_joint_workshop...
It's going to be difficult, however, to use the info provided for the heavy duties as the chart is constructed to reflect the use of a combined fuel. Hmmmmm.... how to tackle that?
Now, to convert those gge's to MBTU and BBTU. Then to decide how to apply that to well production. This is going to take awhile, I think. No allowance for creative license. :0P lol
I may have to fire that committee, I think they went off to study beer. ha, ha, ha
I'm off to find some kind of conversion info.
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The conversion stuff... Yikes, that's where I get lost. It would make me study some sort of alcoholic beverage if I thought too hard about it!
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Permalink Reply by sesport on
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Look what I found (I'll have to see how it works with numbers plugged in that we want calculated) and in all places ... a Kid's Page! lol
http://www.eia.doe.gov/kids/energyfacts/science/energy_calculator.html
Trying to keep you from studying fermentation! lol
:0)
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Permalink Reply by sesport on
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Oh, and I did see an article linked to yours regarding the "Red Queen" / treadmill issue and how production MAY now only be keeping our heads above water. It was an interesting opinion, too.
best :0)
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Permalink Reply by sesport on
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Bookmarked it ... (It's a couple yrs. old, though.)
http://www.theoildrum.com/story/2006/11/8/6636/36918
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Good article. I'm not sure the analogy would hold up today considering the present situation of too much gas.
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Permalink Reply by sesport on
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Ahhhh, here we go, more current information. Natural Gas Consumption by End Use" Vehicles = approx. 30,100 milliion cubic ft. (for 2008).
http://tonto.eia.doe.gov/dnav/ng/ng_cons_sum_dcu_nus_a.htm
And here's Natural Gas Gross Withdrawls and Production ... but uh oh, no 2008 figures. May have to go back and use 2007 figures.
http://tonto.eia.doe.gov/dnav/ng/ng_prod_sum_dcu_NUS_a.htm
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Permalink Reply by sesport on
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Here's a chart with natural gas well average productivity on it.
http://www.eia.doe.gov/emeu/aer/txt/ptb0604.html
Now, to figure out how it all goes together, or doesn't. lol
RE. that Kid's Page ... hey, I'll use whatever I can find. No shame here! :0)
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