Sunday, April 22, 2012

With all this natural gas, who needs oil? -

ByAlexandra Marks, Correspondent / April 22, 2012

It's home-grown, plentiful, and touted as the best way to wean the US off Mideast oil. But there are limits to how far the US can tilt toward a natural gas economy.

Instead of paying $4 a gallon at the pump, it costs them 60 cents for the equivalent

recently as five years ago, oil and gas executives thought the nation's accessible natural gas reserves were almost played out. The industry was proposing building 47 import terminals to bring liquefied natural gas into the US. Five were actually constructed. Now most of them sit underutilized….


Hydraulic fracturing, the controversial drilling technique, has made it possible to access trillions of cubic feet of natural gas locked in shale formations deep beneath vast swaths of the country. High oil prices have made it economical to extract.

The US Department of Energy estimates that 482 trillion cubic feet of natural gas exists in the US. At the current rate of consumption, that's a 90-year supply.

Last year, almost 40 percent of the trash-hauling trucks and 25 percent of the transit buses purchased in the US were fueled by natural gas….

electricity generated by natural gas has jumped from 23 percent to 35 percent. Cambridge Energy Research Associates believes it could double in the next 20 years…..

. Natural gas prices are notoriously volatile. The warm winter and generous supplies of natural gas from the current drilling boom have plunged prices to a 20-year low. That has made tapping the shale less profitable. The pace of drilling in Pennsylvania has already slowed, with rigs moving to more oil-rich fields. Will the jobs now vanish? If drilling slows too much, will prices spike again?

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