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Natural Gas Gains: Not Convinced of Sustainability

I am no longer privy to inside information on natural gas production but I do know that much of the gas we are talking about is old gas...i.e. gas that has been producing to the pipeline for years. For the operator that gas is virtually free. Yes there is some overhead but that is little cost. I suspect that a lot of the drilling going on today is new exploration or lease obligation wells. Lease obligation wells are drilled to save a lease from going to the original owner or to someone else. Some of the drilling may also be aimed at proving up the lateral extent of a new discovery. Sure all of this hearsay on my part but it has been true in the past and I tend to believe it is still going on. Also I would like to point out that most oil or gas operators are not in consort with anyone else and they could care what other operators are drilling unless it is just across the highway from their lease. Sometimes operators will have a relationship with other companies if they have a mutual area of interest. But that rarely happens onshore. It does happen offshore where it costs so much to drill and produce. That is my two cents... For what it is worth.

How Much Natural Gas Remains in the USA?

Does it really matter how much NG is in the US? When the time comes most of what we will need will be imported in the form of LNG. The problem with reserves of NG in the US is that a great deal of the stuff is found in areas that don't have a market and is flared or vented to the atmosphere. LNG makes more sense. You can connect to already available pipelines. By-the-way, probably 80% of the natural gas ever found in the US is already gone. If we ramp up production to supply planes, trains and automobiles then your 100 year supply won't last very long indeed.

Climate Change: How to Invest for the Possibility

Like oil, natural gas is not found everywhere. And as Ferdinand E mentions it is not as abundant as people think. Most of the natural gas that has every been found is gone. It was vented or burned as a by-product. Even today it is burned or vented to the atmospher because there is no market or pipeline needed for transporting. Even exploration today is aimed at non-conventional resources because conventional sources are depleted. With that said, you can bet your bottom dollar that gas will also become a rare commondity and sooner than you think.

Plenty of Natural Gas: Exploration and Production Companies Keep Increasing Oversupply

Your sentence "The action by E&P Companies as a whole could be short sighted" is a flat out stupid sentence. E&P Companies are independent of each other and seldom (if ever) act as a whole.

Natural Gas Stocks: The Ultimate Form of Stored Solar Energy

On the contrary, Mr. Shaefer, we do have a pretty good idea as to how much oil and natural gas is left to be found. As far as the bell shaped curve is concerned Mr. Hubbard did not take into consideration Prudeau Bay or offshore which at the time of his prediction was not even a dream. With that said the curve is not bell shaped. Also he did not consider the impact of a population of 3 billion people growing to 6 billion today nor did he incorporate growing demand. What is disturbing to me is that most of the natural gas found to date has been vented or burned off at the wellhead because of a lack of a market or facilities to gather the gas. I believe I read that North Dakota produces about 85 million cubic gas per day with no market, no gathering system. Is it a coincidence that the drilling for natural gas today is in areas of existing pipelines, population centers and facilities?

Oil Inventory Report Fuels a Market Rally

Congress will not and cannot set prices for petroleum products. 75% of the oil we use is imported. Give me a break.

In addition, all companies involved in oil production also produce natural gas. Likewise, companies that are primarily gas producers also produce oil. By-the-way, natural gas is not the cure-all for the energy crisis. Natural gas is also a resource that is following the downward trend of oil.

The Truth About Fossil Fuels and Renewable Energy (Part II)

Thanks Joseph for the two fine articles. You told it as it is and how it will be. I don't think people realize how very important fossil fuels have been in their lives and to civilization. I dare say I won't be around in twenty years but I can tell you this...the world will be a lot different than it is today and those that are still here won't like it. People born today will not inherit the world of today but will only read about it in history books. That is if we have enough trees left to make history books. Most of my life as been dedicated to the fossil fuel industry and that won't change. We are running out of fossil fuels and that too won't change. With that said we have absolutely nothing else to fall back on. Nothing else will replace what will be gone. Nothing.

Your Oil Stocks Aren't Coming Back

You put producing companies and service companies in the same context and then show a chart of service companies from an American Stock Exchange ETF. Why not put in some of the other indexes such as ^XNG, XOI, $OSX. They may not be ETF's but they all show the same chart. The whole house of cards was in the financial sector. And from your credentials you should have predicted this mess. I think you drive looking in your rearview mirrow.

What’s the Right Price for Oil?

Kiwichick
I stand corrected on my estimates. My numbers are a few months old and from a different source which makes your numbers even more troubling. I like this quote from Niels Bohr (Noble Prize Physicist) "Predictiion is very difficult - especially if it is about the future". Major oil companies have merged because they can't find enough oil themselves. Why? It costs less to buy reserves than to go looking for it. With todays low oil costs we may see more mergers and less drilling. More layoffs, fewer university graduates, fewer employees and fewer new development. Oil, we all know, is a non-renewable resource and we may well be near an economic "tipping point" where companies will just stop looking for domestic oil. There will still be "mom and pop" operators but no more "Big" domestic oil companies. Regardless of the percent decline or supply. The end result will be the same. So how much do you want to pay for it? I write this blog on my Dell which is made with oil. My ceramic coffee cup was made with energy derived from oil. The coffee came in a plastic bag made from oil. The coffee itself was transported to my home on ships, trucks and a car that runs on oil (and electric..a hybrid). Energy drives civilization. Are you ready for a future civilization without oil?

What’s the Right Price for Oil?

Back to your question..what is the right price of oil? Does it not depend on what you want it to be? For the companies that drill and produce it is expensive so they would like the price to be high. Perhaps in the $70 to $85 dollar range. They would be happy with that. But those that use the end products derived from oil they would like to be as low as possible. Perhaps in the the $20 to $30 dollar range. They would be happy with that. So what should the price of oil be? Depends on your point of view, right? If I were a betting man, which I am apt to be. I would bet on the oil companies eventually controlling the price of oil. Granted, the supply of oil is up and demand is down. That is short-sighted. Global DEMAND is INCREASING at an ANNUAL rate of 1.8% and PRODUCTION is DECLINING at an ANNUAL rate of 3% (some say 4 to 5%). Take off your financial blinders and look at the big picture. The price of oil has to go up. Daily reckoning does not apply to oil.

Six Companies Poised to Gain from a Natural Gas Auto Mandate

Natural gas, like oil, is a limited resource and is difficult to store for future use. Natural gas needs a distribution system in the form of a pipeline (underground) at a cost of over a million dollars a mile. So you need big reserves to justify laying a pipeline. Most of the natural gas is gone (at least in the US), vented or burned to the atmosphere. What companies go afer now is the last of that product. The reason companies go after natural gas is because it is not as regulated as oil, it requires no ugly pump jack, no tubing in the hole and is not subject to spills. Like oil today, gas will have to be imported by container ships. You are right that this is a needed commodity to help with the environment. But it won't be cheap.