A number of sources claim that we have hundreds of years worth of natural gas reserves remaining in the USA. Is that really so?
The most authoratative natural gas information is available from EIA.
Based on data from EIA, the annual US consumption of natural gas is about 23 TCF (23 trillion cubic feet). The proven natural gas reserve, as shown here, is 237.726 TCF.
So that's roughly 10 years worth of natural gas left in the USA.
Where did the claims of hundreds of years worth natural gas come from? One such claim is from NaturalGas.org.
They claim, based on EIA data, the US natural gas reserve estimate is 1747.47 TCF. So if you divide that number by annual usage of 23 TCF, you have 76 years worth of natural gas.
Funny I just came back from the EIA web site. All I saw was 237.726 TCF proven reserve, as of the end of 2007. Where did the 1747.47 TCF number come from? Let's scrutinize the NaturalGas.org number a little bit closer:
|Natural Gas Technically Recoverable Resources|
|Natural Gas Resource Category
(Trillion Cubic Feet)
|As of January 1, 2007|
|Unconventional Gas Recovery||644.92|
|Total Lower 48 Unproved||1366.96|
|Total U.S. Unproved||1536.38|
|Total Natural Gas||1747.47|
|Source: Energy Information Administration - Annual Energy Outlook 2009|
Notice the last three lines? Total natural gas reserve is 1747.47 TCF. But only 211.09 TCF is proven reserve. The other 1536.38 TCF is unproven and undiscovered natural gas.
How do you even know that part of undiscovered natural gas reserves even actually exist in the first place? Even if it does exist, which could be a long stretch, undiscovered natural gas reserves are irrelevent until they are actually discovered and actually produced.
I believe we are facing a looming North American natural gas crisis. The currently known reserve is going to run out in 10 years. The "undiscovered" reserves of natural gas, assuming they do exist, have not been discovered in more than half a century of North American natural gas exploration activities. What are the odds that they could be discovered in the next 10 years? The odds don't looking very good. Look at the pace of new natural gas field discoveries in recent years, it surely does not look encouraging at all.
Full Disclosure: I hold significant long positions in UNG, which is relevant to the discussion here. I hold other positions unrelated to natural gas.