Replies to This Discussion

Permalink Reply by The_Baron on December 27, 2008 at 6:54

I have said it before, but the US imports far more gas than it exports. This country needs to stop importing gas, which mostly comes from pipelines from Canada and Mexico, and build a larger more efficient system of interstate pipelines that could make use of the gas found here in the states.

Permalink Reply by Snake Stewart on December 27, 2008 at 6:59

This is somewhat dated but should still give a relatively good idea of where we stand from an import/use ratio.

Rising demand for natural gas, shrinking U.S. gas reserves and increasing production costs, and continuing geopolitical concerns about stable oil supplies have drawn attention to LNG imports into the U.S. for the first time in nearly 30 years. Use of natural gas in U.S. electric power production has increased almost 40 percent in the last decade, while domestic natural gas production declined by four percent. And while the U.S. ranks sixth in the world in natural gas reserves, it supplies only 3.3 percent of the world’s natural gas supply, even as the nation consumes more than 25 percent of all natural gas produced.1

Environmental concerns also drive the marketplace. Natural gas is the cleanest burning of all the fossil fuels, making gas-fired power plants easier to site close to energy-hungry cities. And improvements in combined cycle gas turbine power generators have led to increasing levels of thermal efficiency, reducing both fuel consumption and emissions.

These trends lead to recent projections envisioning LNG imports more than quadrupling by 2010, bringing approximately 2.2 trillion cubic feet of LNG into the country annually.

http://www.whitecase.com/publications/detail.aspx?publication=498

Permalink Reply by Antsu-in-Japan on December 27, 2008 at 7:16

So unless we get on the ball, President-Elect Obama and his administration will be working to end our dependence on oil, just in time for us to create greater dependence on imported natural gas.

Snake, you have projections for increases in demand and I found the same. Of course, this was before the global recession, so it will be a little more difficult to accurately predict what will happen from now. Based on different articles I've seen recently, I think NG will be in unbelievable demand around the globe in the next few years. I hope we can cash in on that movement.


Bedtime for me guys (3:30am here!!)....thanks SO MUCH for the enlightening chat! It's nice to be back...

Permalink Reply by Spring Branch,mineral owner on December 27, 2008 at 11:23

Snake, you said this report was dated, but based on the Barnett, Fayetteville, Marcellus, and now Haynesville Shales, I believe the report is extremely outdated. I think you could make a case , because of transportation costs, the low price of natural gas here as compared to Europe and Japan, and the increasing abundance of Shale gas, that LNG imports could remain depressed for quite a long time,perhaps many years. I know that imports declined dramatically in 2008 vs. 2007.

Permalink Reply by Snake Stewart on December 27, 2008 at 12:27

The report was from '05 I think. Just trying to show where our brilliant minds were 3 1/2 years ago.Things can change in a hurry if you arent carefull.One thing that hasnt changed is our need for a better more stable fuel source.

I hope imports completely vaporize. With the glut we have, even at lower costs , I believe we should be using our own money and not giving it to someone else.

It just seemed to show a continueing case of "let someone else worry about it and get paid" mentality that the U.S. continues to show the world at every opportunity. Why not step up and be original for a change. Be the world leader that we are thought to be. We are the super power yet we lag horribly behind in greener issues. I ainty talking about sucking tree sap to get in touch with your woodsier self either. I am talking greener as in breaking the hold that crude from the middle east and all the other little cartellish countries that are feeding off of our addiction to this ever dwindling fuel source.

Permalink Reply by Spring Branch,mineral owner on December 27, 2008 at 12:40

We share the same sentiments there for sure, Snake.

Permalink Reply by Antsu-in-Japan on December 27, 2008 at 7:02

Hey Baron...is our reluctance to build the transportation infrastructure mainly because of the upfront costs associated with such construction? Why haven't we already done this? And now that we're discovering huge shales (such as ours), do you think there will be any serious change in climate regarding domestic use of NG in the US? Is Obama and this newly elected administration just blowing hot air up our skirts (and trousers for you guys!!)

Permalink Reply by The_Baron on December 27, 2008 at 7:22

Most pipelines are private endeavors. Very expensive to aqquire ROw and then build a line. Most pipeline companies want to have guanteed production from a company with a reliable market locked in before building a big interstate line. We need the government to get involved to build big transmission lines over great distances in a network that would allow gas to sent to wherever it is needed at the time.

Currently gas is seasonal commodity, it is used more in the South when it is very hot to generate electricity so we can run the a/c, and more in the northeast and midwest to heat homes.

I beleive pipelines could be built inside existing interstate ROWs saving the cost of ROW aquistion.

Permalink Reply by Les Bamburg on December 27, 2008 at 7:46

Baron, interstate gas pipelines generally get built based on market forces. FERC has been very supportive in getting new pipelines permitted and built so no need for further government involvement.

Now electrical transmission is another story and does need significant new government policy to get new transmission infrastructure permitted and built.

Permalink Reply by The_Baron on December 27, 2008 at 8:06

I undersatnd that pipelines are built by market forces. That was my point.

I am trying to say the federal government needs to build, or encourage the consrtuction of large interstate pipelines. Wouldn't you agree?

Permalink Reply by The_Baron on December 27, 2008 at 8:07

The situation is exactly the same as electrical transmission. A patchwork of outdated private lines needs to be replaced and upgraded with a comprehensive efficient nation grid.

Permalink Reply by Les Bamburg on December 27, 2008 at 11:10

Baron, no I don't want the government building interstate gas pipelines rather than pipeline companies as it is done today. Current interstate gas pipeline network is not outdated and is extensive and provides significant capacity for moving natural gas to market. As new supply basins develop or market demand increases, the industry builds the required infrastructure. Perfect example is the construction of Rockies Express, a new 42" pipeline from Wyoming to Ohio. Other projects such as the multiple 42" lines being built across North Louisiana are also good examples of the industries reaction to supply growth. These did not require any encouragement by the federal government beyond policies that allowed permitting to occur in a timely fashion.

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