Jim Chanos sees dark side of natural gas boom

|By:, SA News Editor

The downside of the U.S. natural gas boom is that, at historically low prices of ~$3.75/MMBtu, "some of the levered players are struggling to cover their debt service and their obligations to drill more holes under their leases," Jim Chanos tells CNBC.

The boom in nat gas supplies, and the subsequent low prices, is "bad news for global coal as more and more countries switch over to natural gas," he adds.

Chanos is short two different groups of the major oil companies: the big publicly traded majors like Exxon (XOM) - "their problem is finding costs" in reserves like deepwater drilling and the Arctic - and the nationalized companies such as Petrobras (PBR), Ecopetrol (EC) and PetroChina (PTR), which he says really are "political venues."

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