How Much Natural Gas Do We Have Left?

Jul. 16, 2012 8:09 AM ETARCH, APA, BTU, CHK, CTRA, COP, OVV, HAL, SWN, UNG, JRCCQ, ANR184 Comments
Mark Anthony profile picture
Mark Anthony

President Obama proclaimed that the US has 100 years of natural gas (UNG) supply.

Do we really have 100 years of natural gas (NG) supply? Why did Chris Nelder claim that we have only 11 years or less NG supply left? The Potential Gas Committee, the EIA and the USGS gave different estimates of US NG resources. People may interpret the numbers wrong. They may not understand the differences between resource, reserve, and economical reserve.

The PGC claimed we have 2192 TCF of discovered and undiscovered potential NG resources. Marketed NG production was 22 BCF in 2010. So 2192 TCF divided by 22 BCF/year is about 100 years of supply.

I will show that it is naive to jump to a conclusion based on that.

The Difference Between Resource and Reserve

In the oil & gas industry, resource means the amount of gas or oil that remains underground, and reserve means what could be produced from the resource.

Only a portion of the resources could be recovered technically.

Only a portion of the technically recoverable resources could be produced economically.

Only a portion of the economically producible resources could be produced into supply. That is called reserve.

This graph explains what are non-discovered and speculative resources, and what are discovered and proven reserves:

Please read Chris Nelder for details. We extracted 28.6 TCF of gas in 2011. So 273 TCF of proven gas reserve only lasts for ten years. How do NG industry experts and geologists estimate the resources and reserves? I found that these two groups calculate things differently. Investors should know why they calculate the estimates differently.

The Marcellus Shale counts for about half of US shale gas reserves. Recently USGS slashed reserve estimate of Marcellus from 410 TCF to 84 TCF. In response EIA also revised

This article was written by

Mark Anthony profile picture
Mark Anthony, a pseudonym, is an IT professional and former physics Ph.D. student. Visit his blog: Stockology (

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