elliot_mllr

How Much Natural Gas Remains in the USA?

Not only the Haynesville, nut also the Marcellus shale may be a huge play, the borders of which are not yet fully defined. The state of Pennsylvania is giving prospective drillers a hard time in permitting but once that is worked out the Marcellus may be another very large source of gas. In addition to shale and coal bed methane, tight gas is another unconventional source of supply. New techniques such as horizontal drilling make these much more economically recoverable. On the other hand unconventional gas has a faster decline rate than conventional plays at least in the first few years of production, after which it levels off.


On Oct 04 10:46 AM Michael Fitzsimmons wrote:

> i am of course biased, but i believe a much better treatment of this
> subject can be found in this article:
>
> seekingalpha.com/artic...
>
>
> i have not heard many credible experts say we have "hundreds of years
> worth of natural gas reserves" (key there is the "s" on the end of
> hundreds), but i have heard 100 years worth, and would agree with
> that estimate. further, considering the haynesville shale may well
> turn out to be the 4th largest nat gas field in the world, and the
> economic recovery of many other shale regions, and that nat gas production
> is dominated by small independents (and therefore cannot be controlled
> as easily as oil), i don't think you'll see big runs in nat gas prices
> (inflation adjusted) for quite some time. i add "inflation adjusted"
> to that comment because, at the rate the fed and treasury are working
> (unconstitutionally) to print US dollars as fast as they can, we're
> guaranteed to see prices of EVERY commodity go higher in the years
> to come. all this aside, you won't see natural gas prices off a boom-bust
> yo-yo until the US does what it should so obviously do to solve the
> economic, environmental, and national security issues as a result
> of its 60% addiction to foreign oil: adopt natural gas transportation.

Smells Good: The Case for Natural Gas

One slight correction. The "giant sucking sound of $700 billion a year leaving the US " does not go primarily to the Middle East and Russia. Our number one source of crude is Canada and will be for the foreseeable future. Our number two source is Mexico at least until the Canterall field depletes (expected in 8 years). Our number three source is Venezuela (not better than Russia or the Middle East but the fact is that it is our number three source). Saudi Arabia is our fourth largest source of oil. And the amount we send abroad is $660 billion, not $700 billion. Otherwise an excellent article, but it should be emphasized that LNG shipments are being swooped up by Asia and Europe before the tankers ever arrive here (or even leave Qatar) and the new Cheniere regas facility in La. is operating below capacity.

Is the Commodity Bull Market Over?

And in terms of infrastructure growth in the emerging markets, don't forget that asphalt is petroleum based.

Burst Bubble? Commodities' Long-Term Story Remains Intact

One other factor in the precipitous commodities/oil decline is the dumping by hedge funds and others to meet margin calls.

4 Reasons To Be Bullish on Chesapeake Energy

Encore is correct. US royalty trusts are essentially liquidating entities, unlike Canadian trusts, which grow and add reserves.