Jason Barton

Professional Information and Energy News

Archive for the ‘natural gas’ tag

The Hope and Peril of Shale Gas

without comments

Here’s yet another perspective in the ongoing discussion over shale gas and hydraulic fracturing (or fracking, spelled (“fracing” below by Samuelson).

I agree that natural gas provides great promise for the next several decades, especially as it diminishes our reliance on dirtier coal and dirtier and imported oil. But let’s look at that new estimate 90 years worth of gas coming from these new, deeper sources previously locked within shale.

If we move to more vehicles powered by LNG and swap out coal for gas in electricity generation, that 90 years must shrink as estimates on availability are projected according to current use. This means that gas is very helpful to me and maybe to any kids I may one day have, but even within those kids’ lifetimes, and definitely within the lives of the next generation, we’re going to have some serious problems.

As Samuelson says, natural gas is not a panacea. Yes, we should use it, as well as planning on using every drop of petroleum and every last chunk of coal. Continued innovation on other, renewable forms of energy now, not 20 years from now, will ensure that we sill have available gas, coal, and oil 500 to 1000 years from, rather than only 50 to 100 years from now.

This also ties in with the environmental threats posed by shale gas, only briefly mentioned by Samuelson. He says that fracking has been occurring decades “without polluting water supplies,” but the movie he cites, HBO’s “Gasland,” illustrates that this is not accurate.

Developing other energy technologies means that we can hold off on drilling for the supplies that are tougher to access until safer technologies have been developed.

Increasing supply of a diverse suite of energy options while diminishing our demand makes prudent decisions much more likely than if, 30-50 years from now, we are scrambling for any energy sources that are available.

Shale gas: Hope for our energy future

By Robert J. Samuelson
Monday, August 2, 2010

You probably have never heard of oilman George Mitchell, but more than anyone else, he has changed the global energy outlook. In 1981, Mitchell’s small petroleum company faced dwindling natural gas reserves. He proposed a radical idea: drill deeper in the company’s Texas fields to reach gas-bearing shale rock more than a mile down. Because the gas was tightly packed, most engineers believed it was too costly to extract profitably. But after nearly two decades of trying, Mitchell proved doubters wrong. The result: The world has far more available natural gas than anyone suspected.

[…]

How much shale gas exists is unknown, but estimates are huge. The Potential Gas Committee is a group of geologists who regularly estimate future U.S. gas supplies. In 2000, the group’s estimate equaled about 54 years of present annual consumption; by 2008, it was almost 90 years. “This isn’t the end,” says Colorado School of Mines geologist John Curtis. Globally, one study estimated the recoverable supply at 16,200 trillion cubic feet, more than 150 times today’s annual world gas use.

Some standard drilling techniques, applied imaginatively, liberated shale gas. The first was “fracturing” (also called “fracing”): injecting liquids into reservoirs to create openings that allow the gas to flow up the drill pipe. For years, Mitchell’s engineers experimented with different “fracing fluids.” All were expensive, and the resulting gas flows weren’t profitable. In 1997, engineers tried a less costly mix of sand and water. The economics of shale gas improved dramatically, says Dan Steward, a former geologist for Mitchell.

[…]

Shale gas has many virtues, but gains will come at the margin. It isn’t a panacea for every energy ailment.
Consider the impact on oil imports. In theory, natural gas — compressed or converted into a liquid — could replace oil in some vehicles. But natural gas now fuels only about 120,000 of roughly 250 million U.S. cars, vans, trucks and buses. At today’s prices, natural gas is competitive with oil, but there’s a chicken-and-egg problem: Drivers won’t use it without filling stations; companies won’t build stations without drivers.
[…]
The second threat to shale gas is over-regulation. Environmentalists are split. Some favor shale gas as a desirable “bridge fuel” until use of non-carbon energy expands. Others argue gas drilling will threaten drinking water supplies; that was a theme of “Gasland,” a film shown this year on HBO. The charges seem overblown. As the BP spill reaffirmed, all drilling requires regulation. There are environmental issues, especially the safe disposal of “fracing fluids.” But onshore drilling, including “fracing,” has proceeded for decades without polluting water supplies. In shale gas, thousands of feet typically separate shale deposits from water tables.

Read the entire article here.

Colorado Citizens Concerned about Move from Coal to Natural Gas

without comments

Darn, this looked like such a positive move from so many angles, but it’s hard to argue against people who have valid concerns that this move could raise their utility prices or, much worse, threaten their jobs.

The volatility in prices is difficult to control, but is it possible that a slow reduction in coal mining could lead to a smooth retraining for these people into jobs, even within the energy industry, that are safer for Coloradans as well as the people who work in the mines?

These people’s concerns certainly have merit, and I haven’t looked deeply enough into the particulars to offer much insight, but this is a typical example of stakeholders in a somewhat antiquated system fearing change, not because they don’t believe it will be better for all in the long run, but because they fear it will be worse for them in particular in the near future.

If solutions to problems like this one can be found, they could be applied in so many places all over the country in the coming years.

Western Coloradans air concerns on Xcel energy plan

Associated Press
08/30/10 10:00 PM PDT

GRAND JUNCTION, COLO. — Many western Coloradans are urging state regulators to reject moves to switch from coal to natural gas as the fuel to generate electricity.
About 300 people turned out Monday night for a hearing in Grand Junction on a new state law aimed at using natural gas to fuel power plants in efforts to cut power plant emissions. Xcel Energy, the state’s largest producer of electricity, has announced a $1.3 billion plan to convert coal-fired power plants to natural gas in Denver and close a coal plant in Boulder.

Read the entire article here.

Written by Jason

August 1st, 2010 at 8:06 am

Shale’s a curse and blessing for natural gas

without comments

Here’s another installment in the ongoing discussion about the potential for oil and gas from shale. It is interesting and important to put this discussion, about an uncertain technology with great negative and positive potential, in the context of the current spill in the Gulf of Mexico. Given time to work, technologies for shale and deep sea drilling both hold tremendous promise. Rushing them to market before they are ready and reliable poses equally tremendous risks.

By Myra P. Saefong, MarketWatch

TOKYO (MarketWatch) — A supply surplus has made natural gas a cheap source of energy, and its growing production from so-called “unconventional” sources such as shale may be destined to keep it that way.

“Natural gas is at a historically cheap price, assuming we’re just looking at the last ten years, but one major issue not affecting other energy markets is driving the price lower and lower,” said Neal Ryan, managing partner at Ryan Oil & Gas Partners LLC.

Driven by the nation’s growing need for energy and high natural-gas prices in recent years, interest in gas derived from shale, a geologic formation, has increased despite the high costs involved with developing the sources.

“Shale gas provides the largest source of growth in U.S. natural gas supply,” according to the Energy Information Administration’s Annual Energy Outlook 2010 report.

U.S. shale gas production was at 2.02 trillion cubic feet in 2008, up from 1.18 trillion cubic feet in 2007, government data show.

[…]

“Now many of those companies are being forced to continue drilling plans formulated for a much higher market price in order to protect those lease investments,” he said.

That’s “a dangerous spot to be in because the domestic market doesn’t need this gas right now, but companies are stuck having to protect their capital investment,” he said.

[…]

Total U.S. natural gas consumption by end use fell to 22.8 trillion cubic feet in 2009 from 23.2 trillion cubic feet in 2008, according to the EIA.

[…]

Even so, right now there are “a large number of wells that are being drilled to hold leases,” said James Williams, an economist at WTRG Economics, explaining that if a well is not drilled on a new lease within 3-5 years, then control of the mineral rights reverts to the owner and the lease is void.

Read the entire article here.

Written by Jason

May 28th, 2010 at 4:05 pm

Natural Gas Could Ease the Path to a Low-Carbon Future

without comments

Even Worldwatch is getting on board that natural gas, a non-renewable fossil fuel, is a useful transition towards a cleaner future for our energy consumption.

I like it.

The Worldwatch Institute has launched an initiative designed to explore and communicate the potential of natural gas, renewable energy, and energy efficiency to work together to build a low-carbon economy.  The project provides a forum to examine potential environmental, social, and political obstacles that must be addressed if natural gas is to accelerate, rather than delay, a low-carbon energy transformation.  Partnering with leading NGOs, academic institutions, industry, and the public sector, the initiative will propose needed actions, with a focus initially on the United States. The initiative will later focus on energy policies internationally, in particular in India, China, Europe and Africa.

Read the entire article here.

Natural Gas and Alternative Energy: A Promising Combination

without comments

Washington Free Press

posted Mar. 28, 2010   

Possible benefits include drought-protected electricity for Seattle

by Martin Nix

Natural gas is used to heat homes and to generate much of the nation’s electricity. It’s a very effective fuel, and there’s no shortage of it domestically. It can even be made from urban compost and forest residues.

Another benefit of natural gas is that it is “clean burning,” at least in comparison with most other fuels. The emissions from Natural Gas are basically half water vapor and half CO2, with practically no other pollutants. The CO2 emissions can be greatly reduced by integrating alternative energy technology.

[…]

Conserving gas in this way also helps to keep line pressure up in the pipeline. Part of the problem with natural gas distribution is pipe diameter size. Pipes can only haul so much natural gas. In the winter, when the natural gas utility is overloaded, it can cause a drop in line pressure. Solar hot water systems help relieve the overload. This lessens the need for gas infrastructure improvements.

[…]

Another way to reduce consumption of gas is to have an aggressive greenhouse and window-replacement program. Some homes now have four panes of glass, instead of just one or two. This reduces the amount of heat escaping. It also has another bonus: the home is quieter from outside noise.

[…]

Cogeneration is a system that uses natural gas not only to generate electricity on-site, but also to heat or cool the site. Equipment can be retrofited to existing commercial buildings, like laundrymats, which have a constant high demand for hot water. Grocery stores have a constant energy demand for air conditioning, especially in the summer. The heat from a natural gas electrical generator is recaptured to drive a hot water boiler or an absorption-cycle air conditioner. This makes natural gas more efficient, in that it uses the same amount of energy to make both heat and electricity. Electricity is almost like a free bonus.

Read the entire article here.

Cease and desist order issued against Bakken Exploration, LLC of Brighton, Colo.

without comments

Published March 22 2010

Attorney General Wayne Stenehjem announced today that he has issued a cease and desist order against Bakken Exploration, LLC of Brighton, Colo., and its principals, Larry Gilmore and Heather Anne Rodewalt, for alleged violations of North Dakota consumer fraud law and failure to respond to a Civil Investigative Demand.

Bakken Exploration is engaged in the business of obtaining or leasing oil and gas rights from mineral owners in North Dakota, primarily in Burke, Divide, McKenzie, Mountrail, and Williams counties. Stenehjem has received complaints indicating that Bakken Exploration entered into oil and gas leases in North Dakota, subject to 30-day sight drafts, but subsequently refused to make payment on those sight drafts. Bakken later claimed it had been unable to verify title, offered excuses for the delay that do not appear to be true, and then requested 90-day extensions from the mineral owners.

Read the entire article here.

Written by Jason

March 24th, 2010 at 9:28 am

The Promise of Shale Gas

without comments

This important subject has been addressed on this site before, and as I said then, if we can manage our demand for natural gas, we can give these companies time to develop this fracturing technology so that it can be done in more cost effective and environmentally responsible ways.

February 19, 2010

Ken Silverstein, EnergyBiz Insider
Editor-in-Chief

Advanced drilling and completion techniques are the critical means by which natural gas developers now hope to probe vast amounts of shale gas, considered by many to be able to fuel much of the country’s electric generation for decades to come. But before that aspiration can be achieved, producers must solve the environmental complexities.

At issue is how to retrieve such vast resources without harming water quality. The problem is that the shale is a sedimentary rock that holds natural gas 2,000-12,000 feet deep in the earth. To get it out, developers use a process known as hydraulic fracturing whereby millions of gallons of water and chemicals are pumped into the ground, allowing the natural gas to flow to the wellbore.

Read the entire article here.

House Energy Panel Investigating Hydraulic Fracturing

without comments

Bloomberg

February 18, 2010, 08:32 PM EST

By Daniel Whitten

Feb. 18 (Bloomberg) — Halliburton Co. and Schlumberger Ltd. are among eight companies asked by lawmakers for data on chemicals used to get natural gas from shale in an inquiry into effects of the hydraulic fracturing process on the environment.

Representative Henry Waxman, the California Democrat who heads the Energy and Commerce Committee, sent letters to the chief executive officers of the companies seeking information on the number of wells and amount of chemicals used. The panel announced the investigation in a statement today.

Written by Jason

February 19th, 2010 at 8:24 am

Not expanding drilling may cost U.S. $2.4 trillion

without comments

February 16, 2010

A gull flies at a coastal area in Bayou La Batre, Alabama November 10, 2009. REUTERS/Carlos Barria

A gull flies at a coastal area in Bayou La Batre, Alabama November 10, 2009.

Credit: Reuters/Carlos Barria

WASHINGTON (Reuters) – The U.S. economy will lose $2.4 trillion over the next two decades if the federal government does not allow oil and natural gas drilling in restricted onshore lands and in offshore areas previously closed to energy companies, according to a new study released on Monday.

U.S. |  Green Business

The report, prepared for the National Association of Regulatory Utility Commissioners, also said U.S. imports of crude oil, petroleum products and natural gas would increase by $1.6 trillion over the period without access to the energy resources.

[…]

The study also raised the estimated U.S. oil and gas resources that are available in all areas based on advance drilling technology and easier development of energy supplies trapped in shale rock.

As a result, U.S. resources of crude oil were increased by 43 billion barrels to 229 billion and natural gas was raised by 286 trillion cubic feet to 2,034 trillion cubic feet.

Read the entire article here.

Written by Jason

February 16th, 2010 at 7:12 am

Energy Plant Tragedy Puts a Light on Banks, Private Equity Funds Pushing into Electricity

without comments

Wall Street’s Power Surge

By RICH BLAKE
Feb. 11, 2010

Goldman Sachs has attracted a long line of critics and conspiracy theorists convinced the Wall Street bank is at the root of many an economic catastrophe.

Photo: Federal officials to investigate Connecticut blast

The Kleen Energy plant is seen in this aerial photo after an explosion in Middletown, Conn., Sunday, Feb. 7, 2010.

(Jessica Hill/AP Photo)

But after a deadly power plant explosion in Middletown, Conn., involving a company called Kleen Energy, even members of the conspiracy crowd might have been surprised to learn that the natural gas-fueled plant was being built by a private equity fund and that it had been bankrolled by Goldman.

And while no one is suggesting the bank’s involvement underwriting the nearly $1 billion project would have in any way compromised safety — indeed, the exact cause of the explosion is still under investigation — the incident does call attention to the ever-growing alignment between a shifting national energy policy and the Wall Street financiers who hope to profit from the green movement.

[…]

While coal fired plants still produce roughly half of all the kilowatt hours of electricity consumed in the United States, natural gas, which a decade ago accounted for just 10 percent of electricity produced, now accounts for upwards of 20 percent, according to the Edison Electric Institute. Hydro and alternative sources make up the balance.

Read the entire article here.

Written by Jason

February 11th, 2010 at 7:24 am