Thanks for posting that, riker. Would be nice if Schlumberger got involved, especially if it were cheaper and, perhaps more importantly now, faster.
All --
I would just link the site and let you go to it if you wanted to read the article but this article probably won't be available for more than a few days. I and others have posted reasons for the increase in natural gas useage. This one explains why a U.S. Senate committee is showing an interest:
<<April 22, l999
Senate committee seeks answers on gas supply
With environmental concerns giving natural gas an advantage over other fossil fuels, the Senate Energy and Natural Resources Committee called on officials yesterday to show that the industry can keep pace with the expected increase in demand.
If natural gas is the direction to which the nation is leaning, the committee believed it was necessary to establish a record by convening a hearing on whether the natural gas industry was prepared. Sen. Frank Murkowski, R-Alaska, who chairs the committee, asked each witness if 30 trillion cf in demand by 2010 could be met.
"Can we achieve this goal or does the administration have to step in to encourage the industry?" Murkowski asked the panelists.
The industry officials unanimously said they are confident the United States has the gas resource base to meet the new demand. But different scenarios need to play out in order for it to happen.
"Legislators and regulators must do all they can to ensure that the role of natural gas in the U.S. continues to increase," noted Paul Elbert, president and CEO of natural gas for Consumers Energy, speaking on behalf of the American Gas Assn. (AGA).
A representative for the Independent Petroleum Assn. of America argued producers today assume all the capital and production price risks associated with the entire natural gas market, but receive at most only 47% of the revenue, H.G. Kleemeier said on behalf of the Independent Petroleum Assn. of America (IPAA). If the risk-revenue ratio doesn't improve, "[producers] as an industry could not and will not achieve the 30 trillion cf a year," Kleemeier said.
Low oil prices have shut in 136,000 oil wells and 57,000 gas wells in the past 18 months. Capital budgets have been cut for new oil and gas upstream development. "Without a strong domestic oil industry, the national goal of a 30 trillion cf a year natural gas market will not be achievable," Kleemeier argued.
The officials agreed the federal government needs to open up more lands onshore and offshore to natural gas exploration and development.
In addition, AGA's Elbert recommended an increase in federal funding for natural gas research and development programs as well as the adoption of fair standards for natural gas in federal programs and fuel- neutral environmental standards.
To meet the goal, said Keith Bailey, chairman, president and CEO of Williams, interstate pipelines will need three things: "availability of capital, increased flexibility to serve the needs of a changing market, and a streamlined certificate and construction process."
Speaking on behalf of the Interstate Natural Gas Assn. of America, Bailey also said, "Should FERC's regulatory model change, making the reward no longer commensurate with the risk, pipelines will become an unattractive asset for Williams, and likely for others."
In addition, Bailey said Congress should make public lands as accessible as possible.
Canada now supplies 14% of the U.S. gas consumption. To meet the future growth, it will require significant production growth from both the United States and Canada, said Gerg Stringham, vice president of markets and fiscal policy for the Canadian Assn. of Petroleum Producers. "We have enough supply, but not enough pipeline capacity to move gas," he said.
Several positive tax code revisions will encourage domestic gas development, said Richard Sharples, president of Anadarko Energy Services and chairman of the Natural Gas Supply Assn. On this matter, Sen. Jeff Bingaman, D-N.M., said he is working on tax proposals to provide some protection to the industry. In addition, he has urged the Energy and Interior Depts. "to look at royalty reductions on marginal gas wells again."
"This decline [of natural gas production] is real," Sharples said. Energy policymakers have to carefully weigh the potential impact of their actions on the viability of the U.S. energy industry.
In the meantime, the industry itself has to carefully manage its business. But "some of us will do this better than others," he predicted. "Some of us will fail.">> |
