City Center is a dazzling array of towering hotels, condos, restaurants and high end shops and boutiques occupying 67 acres with more than a quarter mile of frontage on the Las Vegas Strip. With more than 18 million square feet of development, it is truly a city within a city.

One million tons of concrete were used in its construction, enough to build a four foot wide sidewalk from Las Vegas to New York City and back. The steel that was used would be enough to build ten Eiffel Towers and the fiber optic cable in the project could circle the equator four times! Clearing the site produced more than 300,000 tons of construction debris but 93 percent of it was recycled.

This, plus the fact that natural gas is used throughout the project has enabled City Center to receive LEED Gold certification for energy and environmental excellence.

A ten megawatt natural gas fueled cogeneration plant provides much of the electricity. Every residential condo unit features a top of the line gas cooktop and all of the hotels and restaurants have huge kitchens filled with natural gas cooking equipment. I think the only chef in the project that does not cook with gas is the guy that makes sushi.

The MGM Mirage City Center is an outstanding example of how the direct use on natural gas provides builders with a pathway toward high efficiency, high performance and a low carbon footprint.

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The 2010 TNAH, however, has met a different fate and is, in some ways, the poster child for the state of the new home construction industry. The home was about 75 percent complete in November when the builder ran out of money and could not, even after a concerted effort by the NAHB and allies throughout the country, obtain financing to finish the job. The bank foreclosed on the home on December 28 and the builder has gone out of business.

To its credit, the NAHB made  lemonade out of this lemon by producing a very professional “virtual tour” of TNAH, and builders are lining up to view it. Numerous natural gas appliances are in the home, including the “Phoenix” solar/gas water heater from Heat Transfer Products, Inc. That product is in the AGA exhibit booth as is the Ecopower Microcogeneration (CHP) appliance sized for residential and small commercial applications. This unit, made by Marathon Engine Systems and fueled by natural gas, is running full time in our booth, producing all the electricity for the entire exhibit. We are not connected to the electric grid!

Despite the current condition of the housing industry, builder traffic in our exhibit has been excellent and there appears to be a lot of interest in the natural gas technology we are showcasing. The Natural Gas Home is truly a Green Home.

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The 2010 National Association of Homebuilders (NAHB) International Builders Show (IBS) gets underway today in Las Vegas, Nevada. The expected attendance is around 55,000, nearly half the number that attended the IBS when it was held in Orlando just a few years ago.

This is a reflection of the state of the U.S. housing industry, to be sure, but the good news is that the fall off is almost entirely in the exhibitor category. The number of exhibitors, and the people they have sent to the Show, is off by some 40 percent, but the number of builders has actually held steady from last year.

Still, with over a half million square feet of exhibits, the annual IBS remains the largest light construction trade show in the world. A lot of corporations and organizations have been loyal exhibitors, including the American Gas Association, and the NAHB is expressing its gratitude.

At the Executive Board Meeting held on Saturday, a dozen exhibitors were recognized by name as they have exhibited continuously for over 50 years. The AGA was recognized for its record of 63 straight years, behind only the Kohler Company, the Masonite Corporation and GE, which have each exhibited for 65 years. And these long time exhibitors will be again be recognized on Thursday at the full NAHB Board of Directors Meeting attended by more than 5,000 people.

A large variety of gas equipment and appliances are on display at the IBS, not only in the AGA exhibit but also throughout the convention center in the exhibits of manufacturers of gas products. They point out the tremendous economic, environmental and performance benefits of using natural gas directly in the home. And not just in the home. The giant City Center Complex, a city within a city, just opened in Las Vegas and it is one heck of a natural gas direct use success story! It truly is the talk of the town and I will explain why in my next post.

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Much of the increase comes from shale formations that lie underneath Texas, Arkansas and the entire Appalachian Mountain chain. And some claim that the Haynesville shale formation underneath Louisiana may be the fourth-largest natural gas field in the world!

What has been less reported, but what may be just as important in terms of long term supplies, is the very real potential for methane hydrates – natural gas trapped inside ice-like crystals.

At a hearing last Thursday in the House Energy & Minerals Subcommittee of the Natural Resources Committee, a U.S. Geological Survey research geologist stated that the USGS has conducted its first-ever resource estimate of technically recoverable (using today’s technology) natural gas from methane hydrates and has determined that amount to be 85 Tcf on the North Slope of Alaska alone.

And in a separate study, the U.S. Minerals Management Service reported last year that more than 6,700 Tcf of natural gas is trapped in hydrates in high concentrations in sand reservoirs in the Gulf of Mexico. Under normal economic conditions, we use as a nation about 25 Tcf of natural gas every year.

With so much attention being directed toward biofuels, renewable and alternative energy, let us not ignore natural gas. We have many generations worth of the clean burning fuel right here in America.

Thankfully, we have strong voices on Capitol Hill standing up for this premium, home grown energy resource. In the House, Oklahoma Representatives Dan Boren and John Sullivan are championing the use of natural gas as a transportation fuel, with strong public relations support from billionaire T. Boone Pickens.

Over in the Senate, Louisiana Senator Mary Landrieu, as reported in “E&E News,” has said that “I’m using the (recess) time to try respectfully to educate members of my caucus, and maybe some Republicans, about the importance of natural gas, and the importance of domestic energy security, so we don’t lose that in this debate. It’s not just about cleaning up the environment. It’s about securing America’s economic future. And both are important.”

Right on, Senator. We need to tell anyone who will listen that choosing natural gas means being comfortable and responsible.

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The committee approved an amendment offered by Senator Byron Dorgan (D-ND) that will provide significant new access in the Eastern Gulf of Mexico (EGOM). Under current law, oil and gas leasing is prohibited until 2022 in the EGOM that lies within 125 miles of the Florida Panhandle and within 235 miles of the state’s western coastline.

The Dorgan amendment will open the EGOM beyond 45 miles of the Florida coast for oil and gas development, including the “Destin Dome” natural gas discovery that lies approximately 25 miles south of Pensacola. Existing pipeline and other vital infrastructure lie right next door in the already open Central Gulf of Mexico, so natural gas produced from the new area could come online and be on its way to consumers fairly quickly.

According to the American Petroleum Institute, The Destin Dome could produce anywhere from 110 to 165 billion cubic feet of gas every year for the next 20 years.  U.S. Senators from both parties have long been saying that we need to solve the problem of our dependence on imported oil. Some of the answers, such as renewable and alternative forms of energy, involve very long lead times. The Dorgan Amendment, however, provides a here and now solution that can be realized fairly quickly.

Perennial Senate opponents to offshore energy production, such as Bill Nelson of Florida and Robert Menendez of New Jersey, have vowed to filibuster and the environmental groups are calling the amendment a “poison pill” that will bring down the entire energy bill. But I agree with Senator Ben Nelson of Nebraska who believes that the addition of real domestic energy production to the bill actually enhances its chance of passage. Could this be because the overwhelming majority of the American public is in favor of offshore drilling for oil and natural gas?

For the sake of our economy and our standard of living, let us hope that the Dorgan amendment gets enacted into law. For a summary of the Dorgan amendment, click here. To see AGA’s letter, click here. To read our press release, click here.

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Interior Secretary Ken Salazar presided and listened to statements by New Jersey Governor Jon Corzine and several of the state’s congressmen, all opposed to oil and gas drilling, as well as from many anti-drilling activists who almost, but not quite, dominated the meeting.

Secretary Salazar hosted the first of four regional public meetings to gather information and public comment regarding an energy strategy for the Outer Continental Shelf [Photo Credit: Tami A. Heilemann DOI]

To me, this was no surprise since New Jersey is ground zero for East Coast opposition to drilling on the OCS. The crowd may have been decidedly different if the hearing had been held in, say, Charleston, SC, or Savannah, GA, or maybe even in Norfolk, VA. To be fair, Interior has also scheduled OCS field hearings in New Orleans, San Francisco and Anchorage.

In two of these locations, those in favor of oil and gas production on the OCS should be in the majority. But that was not the case in Atlantic City!

Those in favor of more domestic oil and gas production got their views in to be sure. Congressman Rob Bishop (R-UT), who serves on the House Natural Resources Committee, and former Congressman John Peterson (R-PA), were very eloquent in their support of more OCS access. But anti-fossil fuel activists and environmental groups made the most noise.

I was struck by the fact that all the industry and business people that spoke out used part of their allotted three minutes to state that they were for all energy options, including renewable and alternative energy. This is in contrast to opponents of energy development on the OCS. They are clearly against oil, natural gas, coal and nuclear energy. They are only for renewables, especially wind and solar.

What they do not, or refuse, to realize is that natural gas is part of the answer to our energy and climate challenges and can make more renewable energy possible. Revenues from natural gas production on the OCS could fund wind energy production on the OCS instead of tax payer dollars. And both the gas and the electricity produced could come to shore via the same undersea infrastructure.

This is a win-win scenario for our country and it is what I talked about during my three minutes at the microphone.

Here’s a link to video from the event.

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AGA president and CEO Dave Parker, Secretary of the Interior Ken Salazar and AGA chairman and chairman, president and chief executive officer of Piedmont Natural Gas Tom Skains.

He indicated that the environmental community may be unhappy with him because he believes that our country will continue to depend upon and use fossil fuel energy for years to come, and that his department will lease more areas for oil and gas exploration and production, not less.

That said, he also indicated that energy companies may not be happy with him either as many areas will remain closed or tightly restricted. He expects continuing disagreement over public land use. Before moving forward to lease areas for energy development, he said, more information is needed, particularly on the Outer Continental Shelf (OCS) where available data is decades old.

The series of four OCS field hearings scheduled for next month, which the Secretary will personally attend, are designed to gather information from stakeholders and will help guide the Interior Department’s planning. More information is available here.

Secretary Salazar had good things to say about natural gas, acknowledging its efficiency, especially when used directly by the consumer, its cleanliness and abundant domestic supply. Salazar says that the Obama Administration knows that natural gas is part of the solution, but he wondered aloud about whether those in Congress or the general public know this and said that we need to do a better job of telling our story. Of this there is little disagreement.

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• Our economy and national security require less imported oil and more domestic energy production.
• Natural Gas is our cleanest fossil fuel and its use is good for the environment and an answer to the challenge of climate change.
• Abundant resources of natural gas exist on the federal OCS.
• This gas can be found and produced cleanly and safely as proven by the offshore production industry’s outstanding safety record. The risk of environmental damage is very, very, small.
• Coastal states should be able to decide on energy exploration and production off their coasts and share in production royalties.
• The OCS offers the potential of some $1.7 Trillion in potential new revenues for federal, State and local governments, money that can be used to fund renewable energy, conservation, roads, schools and other critical programs.
• OCS energy development will provide new jobs and an economic boost to coastal states and needed new supplies of clean natural gas for the nation.

Environmentally conscious countries all over the world explore offshore and safely produce oil and natural gas every day. Our country needs to get with the program and start producing more natural gas from our offshore waters. I hope that you will add your voice to the debate. More information is available here. You can leave your comments on the draft here.

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Maybe Congress can find a happy medium between these views and include it as part of the energy legislation now being drafted in both chambers. That would be a big victory for American consumers as such a compromise would nevertheless open up new areas of great potential for new supplies of natural gas.

At the end of these hearings, I was left with the distinct impression that the question now is where, and under what conditions, to allow offshore energy exploration and production, and not if to allow it. Our position is made clear in a letter to Chairman Rahall from AGA President, David Parker.

Much depends, or at least should depend, on the position taken by coastal states. The legislatures of both North Carolina and South Carolina have established bicameral, and bipartisan, study committees on the OCS to gather input from the public and experts in the field in order to obtain a balanced perspective on the issue. An editorial by North Carolina state senator Bob Rucho in the “Charlotte Observer” presents a balanced viewpoint which I hope other state legislators would adopt as well.

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Opening the hearing yesterday, Committee Chairman Nick Rahall (D-WV) told the environmentalists “I understand your desire to see the (oil and gas leasing) moratoria reinstated. However, we may be in a situation where the ship has already sailed.” Although he derided chants made at last year’s Republican National Convention to “drill, baby, drill,” Rahall stated that “the political reality may be that the moratoria, as we knew it, will not be reimposed.”

This did not sit well with the day’s two star witnesses, actor Ted Danson, a board member of conservationist group Oceana, and Philippe Cousteau, a board member of the Ocean Conservancy and grandson of famed ocean explorer Jacques Cousteau. They repeatedly spoke in opposition to ALL offshore oil and gas development, not just drilling in new areas, on the grounds that the products produced were fossil fuels that, when consumed, would increase the level of carbon dioxide in the atmosphere, which is absorbed by the earth’s oceans, which then become more acidic, resulting in the death of all life in the sea. What?  I don’t know about you but this seems like it may be more science fiction than scientific. They were fine with the development of alternative energy on the Outer Continental Shelf (OCS), such as wind and harnessing tides and currents, so long as no environmental damage is done.

What do you think about all this? I think that with OPEC meeting next month to decide on steps to take to increase the price of oil, our country must aggressively develop all sources of energy, renewable, alternative and conventional. And this most emphatically means more exploration and production of clean natural gas from as much of the federal OCS as possible.

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