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How Much Natural Gas Does the U.S. Have
Recently the Heritage Foundation posted an article on cap and trade on their blog. In the article, they talk about the potential of natural gas supply. I left a comment there and thought the information might be useful for anyone considering the same question. My thoughts on the article appear below.
Many people have heard conflicting numbers regarding the supply of natural gas in the United States. Most everyone who knows about U.S. natural gas supply would agree that the U.S. has abundant supplies of natural gas. So why the confusion? It’s because the natural gas industry uses different numbers, for different reasons, to describe supply. My bottom line: Someday the U.S. may stop using natural gas because something better may come along. But when that happens, I believe there will still be huge quantities of natural gas lying beneath U.S. lands and waters.
10 Years of Supply: Sometimes people are referring to “proved reserves” of natural gas. The U.S. Energy Information Administration’s latest estimate of proved reserves of dry natural gas in the U.S. is 237,726 billion cubic feet – enough to supply current U.S. demand for about 10 years. http://www.eia.doe.gov/pub/oil_gas/natural_gas/data_publications/crude_oil_natural_gas_reserves/current/pdf/table01.pdf
Proved reserves look something like inventory, what you have discovered and know you can produce if you go ahead and drill it. The U.S. usually has around 8 to 10 years of proved reserves.
80 Years of Supply: Another way of looking at natural gas supply is to look at the U.S. natural gas resource base. The natural gas resource base can mean all natural gas that exists or, more commonly, all natural gas that is currently technically recoverable. Technical recovery also usually implies that the gas can be recovered economically. This is where we see the big differences in numbers. The 2007 report of the Potential Gas Committee of the Colorado School of Mines determined that in 2006 the U.S. had a natural gas resource base of 1,525 Trillion cubic feet of natural in the U.S. (about an 82 year supply).
Thousands of Years of Supply: Does this mean that in 82 years we will run out of natural gas? No. It means that with today’s technologies and in today’s market we may have an 82 year supply. But there are mind-numbing quantities of natural gas that we do not count today. It is likely that the next report of the Potential Gas Committee will find that we now have much more natural gas because of the relatively recent perfection of drilling technologies that will allow the production of huge quantities of U.S. natural gas from shale. But even gas from shale may be a drop in the bucket compared to the staggering quantities of frozen natural gas that are in and around the United States. This is regular natural gas that is frozen because it is under pressure in the waters of the U.S. Outer Continental Shelf. This frozen natural gas is called methane hydrates or methane clathrates and we currently do not have the technologies in place to produce this natural gas from the OCS. However, methane hydrates are also found in Alaska and northern Canada beneath the permafrost. Recently experimental wells have been drilled and some natural gas from methane hydrates have been produced with today’s technologies.
When you look at natural gas from methane hydrates, the numbers are staggering. It has often been said that the energy from the methane hydrates in the U.S. vastly exceed the energy found in all the coal, oil and conventional natural gas in the U.S. combined. One estimate of U.S. methane hydrates is 200,000 Trillion cubic feet – close to 9,000 years of supply at current U.S. consumption levels.
So how much natural gas do we have in the United States? The realistic answer depends on technology and economics.
http://www.mrs.org/s_mrs/bin.asp?CID=12527&DID=208645
http://fossil.energy.gov/programs/oilgas/publications/methane_hydrates/MHydrate_overview_06-2007.pdf
ARRA funding for Clean Cities
Great news for our friends at the Clean Cities program. Vice President Joe Biden recently announced $300 million in funding from the American Recovery and Reinvestment Act (ARRA) for state and local governments, and transit authorities to expand the nation’s fleet of clean, sustainable vehicles. The funds are also going to be used for the fueling infrastructure necessary to support those vehicles.
The $300 million in funds adds to the reported $11 billion already announced by the U.S. Department of Energy (DOE) to bolster state and local government energy efficiency programs and weatherize low-income homes.
Clean Cities is a government-industry partnership sponsored by the DOE’s Vehicle Technologies Program. With almost 90 local coalitions and more than 5,700 stakeholders, Clean Cities’ mission is to reduce petroleum consumption in the transportation sector.
We’ve mentioned Clean Cities before when Piedmont Natural Gas was awarded the 2008 Clean Cities Award, given annually by the Centralina Clean Fuels Coalition (CCFC) to the business or organization that “best demonstrates excellence in clean transportation and fuel activities” and I’m sure we’ll be mentioning them in the future as well. There is some great work going on there with natural gas fleets.
For more information on the ARRA, visit the ARRA web site or be sure to visit AGA’s section on ARRA. We’ve got some great audio there from recent teleconferences on the topic. While you’re there, you can also check out AGA’s section on energy efficiency.
Natural gas key to Wellinghoff vision
The Chairman of the Federal Energy Regulatory Commission, Jon Wellinghoff, recently made news by suggesting that there may never be a need for a new nuclear or coal power plant to be built in the U.S. Chairman Wellinghoff envisions a future in which renewable resources such as wind, solar, and hydrokinetics are backed-up by natural gas-fired generation — central and distributed facilities — which will provide load-response services. If this potential were fully realized, coal and nuclear could theoretically be priced out of the market, potentially making baseload generating capacity a thing of the past. A robust electric transmission system, demand response programs — “smart” grid — and increased energy efficiency would be an important part of the picture. Chairman Wellinghoff raises a very important point regarding the economics that support this vision — expectations of ever-higher construction costs and increased siting challenges associated with new coal and nuclear plants are changing thinking about the relative cost equation comparing traditional central generation plant and distributed resources — renewable or other. This shift in thinking on the part of leading policymakers is representative of the sea change that is occurring in thinking about how and where we produce energy.
Natural gas will play an important role in enabling this “smart” vision whether through traditional uses in space and water heating, or in the production of electricity inside of or nearer to homes and businesses. As part of the state-wide New Jersey Clean Energy Program, natural gas utilities in that state administer Pay for Performance, which provides incentives of up to $1 million to industrial and commercial customers for purchasing and installing Combined Heat and Power (CHP) units. This emerging technology is expected to become increasingly prevalent as an innovative way to enhance energy efficiency through recovery and productive use of waste heat, thus reducing both demand on the electric power grid and carbon dioxide emissions. And although it’s not yet ready for the mass market, even micro CHP (the smaller version designed for residential use) is beginning to earn some attention.
In short, Chairman Wellinghoff is definitely on to something “smart” and natural gas will be key to his vision becoming a reality.
True Blue Natural Gas Blog from the American Gas Association (AGA)- Natural Gas Roundtable: Caruso and Hatley
- Focus on Low-Carbon Solutions
- Congrats to Alagasco on their expanding natural gas fleet
- Natural Gas Market Indicators
- Spectra Responds to Natural Gas Pipeline Concerns
- Don’t Miss Out—Make Sure to Register for the World Shale Gas Conference & Exposition
- Dave Parker Receives Prestigious Key Award from ASAE and The Center
- Department of Energy proposes to use full-fuel-cycle analyses in developing energy efficiency standards
- High dividend tax rates will negatively impact utilities
- White House Supports Keeping Maximum Dividend Tax Rate At 20%
