Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Douglas V. Fant who wrote (49223)	8/11/1999 4:25:00 PM
From: JoeDi1213	Read Replies (1) \| Respond to of 95453

I know exactly what it means. If we have a cold winter I'll be freezing my butt off because CON ED won't have any fuel for their power plants. No seriously this could be a big problem going forward last years warm winter really bailed us out and only postponed the day of reckoning.

To: Douglas V. Fant who wrote (49223)	8/12/1999 10:01:00 AM
From: Tomas	Read Replies (2) \| Respond to of 95453

Analysts split on gas price forecast. Get set for a red-hot debate about natural gas supplies and prices. Calgary Herald, August 12 Barry Nelson The possibility of a serious, long-term energy shortage hasn't been raised since the heady days before the National Energy Program encouraged companies to explore the high Arctic based on predictions that oil prices were headed for $100 a barrel. But the threat of shortages may now be very real. Canada's leading experts now have wildly differing views of how much natural gas is available and where gas prices are headed. The latest forecast from the National Energy Board assures us there is plenty of gas -- so much in fact that it might sell for about half today's price for more than a decade. The NEB forecasts two possibilities. One says prices will "remain relatively flat, in real terms, at about $1.65 a gigajoule until 2010, when they start to rise and reach about $2.60 a gigajoule by 2025." The second alternative sees prices rise steadily to about $3.60 a gigajoule by 2025, but average yearly prices won't reach today's spot price level until after 2015. But a paper prepared by Alberta Energy and Utilities Board experts presents a completely different picture. Authors Lorne Samson, recently retired head of the reserves section at the AEUB, and Marie-Anne Kirsch, of the board's economic policy planning group, warn "the province will be facing a supply problem in the near future." "Beginning early in the new millennium, gas production in Alberta, on an ever-increasing basis, will not meet the projected market demand." Samson and Kirsch see demand exceeding production capacity by 2003. They say the supply crunch could be delayed by successful drilling activity, but point out this activity "would have to dramatically exceed anything the province has experienced historically." Last year, Alberta produced about 5.1 trillion cubic feet of gas. Roughly half this amount was exported to the U.S., 25 per cent was shipped to Eastern Canada and 25 per cent was sold within Alberta. The AEUB says Alberta has proven conventional gas reserves of about 45 trillion cubic feet. This means we now have enough gas to meet all demand for only nine years unless big new discoveries are made. And if the NEB is right about prices, there is not much incentive for producers to explore for new reserves. A big part of the problem is that low prices have made producers content to drill shallow, low-risk, low-output development wells close to known supplies rather than gamble on drilling deep, expensive exploration wells in the foothills areas where there is a possibility of finding big new reserves. People at the AEUB take pains to point out that rapidly dwindling reserves do not mean that Albertans are in immediate danger of running out of gas. The Gas Resources Preservation Act of 1949 requires producers to obtain permission from the AEUB to ship gas outside the province. The act says the board shall not grant a permit unless it is in the public interest to do so, having regard to "the present and future needs of persons in Alberta (and) the established reserves and the trends in growth and discoveries of reserves of gas or propane in Alberta." The board now interprets this to mean there must be a guaranteed 15-year supply of gas for residential and commercial users before any gas is sent outside Alberta. So Albertans gain a bit of breathing room, but it's understandable if customers in the U.S. and even in Eastern Canada begin to question the security of their supplies. And, of course, the NEB may be right. Perhaps there's gas aplenty. But debate will rage at least until next year when the Canadian Gas Potential Committee, a group of about 25 industry experts headed by former NEB chairman Roland Priddle, is expected to report its estimate of total gas supplies. calgaryherald.com