Wednesday, June 17, 2009

America Has Century of Natural Gas at Current Usage Rates

A report by the nonprofit Potential Gas Committee concludes the U.S. has more than 2,000 trillion cubic feet of natural gas still in the ground, or nearly a century's worth of production at current rates. According to the report, the amount of natural gas available for production in the United States has soared because of a drilling boom and the discovery of huge new gas fields in Texas, Louisiana and Pennsylvania. That's a 35.4% jump over the committee's last estimate, in 2007, of 1,532 trillion cubic feet, the biggest increase in the committee's 44-year history.

The Potential Gas Committee's study was prepared by industry geologists who analyzed individual gas fields using seismic imagery and production data provided by gas producers. The surge in gas resources is the result of a five-year-long drilling boom spurred by high natural-gas prices, easy credit and new technologies that allowed companies to produce gas from a dense kind of rock known as shale. The first big shale formation to be discovered, the Barnett Shale near Fort Worth, Texas, is now the country's top-producing gas field, and companies have made other huge discoveries in Arkansas, Louisiana and Pennsylvania.

The sudden increase in supplies, combined with a drop in demand due to the recession, has led to a gas glut, pushing prices to about $4 per million British thermal units [thuosand cubic feet] down from more than $13 per million BTUs last July. (WSJ, 6/17/09)

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