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Natural Gas: Sharing Will Benefit All

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June 24, 2011 – Comments (0) | RELATED TICKERS: COP , MRO , UNG

We all know that the United States has a major dependence on oil, not to mention a dependence on foreign oil. With the new technology such as fracking and horizontal drilling, there has been positive momentum building towards the hopes for energy independence. But, what if that justdoesn’t cut it? Export natural gas? You betcha! Christopher Helman explains why this would be the case.

 

 …going after oil instead of gas isn’t helping reduce the gas glut at all, because in virtually every oil field you’ll also find associated gas. With the price of oil so high the drillers are incentivised to give away the gas for free and just make money on the liquids. In the Woodford shale of Oklahoma, Continental Resources says the gas they produce is so “wet” with other liquids like butane and propane that they can get $8 per mmbtu, far more than the going rate of $4.32 for dry gas…

"…It feels like a bait and switch. America needs to reduce its reliance on foreign petroleum, but that won’t happen without further boosting our already ample supplies of gas. So to import less oil we’ll need to export more gas–at least until electric utilities, manufacturers and car makers build enough new plants, factories and natgas-powered cars to soak up the excess…

…Gas exports can’t come soon enough for America’s natural gas drillers, looking for something, anything to goose demand. Yet the Industrial Energy Consumers of America, lobbyists for manufacturers of plastics, cement, paper, steel, chemicals and such, sought to block Cheniere’s export approval. They want the gas to remain in the U.S. to provide cheaper electricity and cheaper feedstock for making chemicals and plastics. They say that shipping gas overseas will only hurt Americans by making it more expensive at home."

 

Read the entire article here: http://turnkeyoil.com/2011/06/24/natural-gas-sharing-will-benefit-all/

 

 

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