US Natural Gas stocks predicted to remain low

NeoPeasant

I wish I knew what was really going on with natural gas. Here in Utah there is a natural gas car mania in progress, supported by the general consensus that there is absolutely no reason to be concerned about future prices or supplies of natural gas.
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WyoDutch

Tuesday, July 8, 2008 2:05 AM MDT

CHEYENNE (AP) -- Officials say heating bills could rise from 30 percent to 70 percent in Wyoming this winter compared to last.

"It's pretty gruesome," said Rob Hurless, energy adviser to Gov. Dave Freudenthal. Hurless monitors energy prices, including the price of natural gas -- the chief fuel for winter heating. Hurless and other state officials say consumers should prepare now, because the first heating bill after a cold snap this fall could be a real shock.

Natural gas consumption and prices typically drop in the spring as producers store gas for the winter. However, Hurless said demand hasn't dipped this year.

Chris Petrie, chief counsel for the Wyoming Public Service Commission, said the commission has been working on plans in recent weeks to prepare for the price increases. "The increases are not terribly apparent to customers at this time of year," Petrie said, noting that consumers typically use less gas in the spring.

"So in the winter months -- when you have a much higher use in volume -- you will see a much more dramatic increase in the bill," Petrie said.

One rural provider of natural gas has already seen prices rise 70 percent, Petrie said, adding that such increases will eventually be passed along to consumers. He said the PSC is anticipating a 30 to 70 percent price increase over the winter.

Petrie said people should start thinking now about winterizing their houses and planning how to cover higher energy costs this winter.

Hurless said he agreed. "You don't notice the uptick if you are just running a gas water heater, but you will when the furnace kicks on," he said.

While Hurless said natural gas prices fluctuate, he doesn't expect they're going to go down.

Hurless said there are a number of reasons for the rising price of natural gas. Among them, he said natural gas is tied to the price of oil. People in other parts of the country are changing from heating oil to natural gas. Many global contracts for natural gas are tied to oil prices.

In addition, he said fewer coal-burning power plants are being built because of environmental concerns. He said energy companies are turning more to natural gas to run their turbines.

Less natural gas is available for import, Hurless said. He said Canada is using natural gas to heat oil shale to make petroleum, while the Middle East and Asia are consuming more of their gas.

"If there is a message here, it's check the windows and do all you can to winterize now," he said.
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Cashmere · Light Sweet Crude Joined: Mar 27, 2008 Posts: 1970

Not sure why futs remain low, but NG may end up rivaling PO in the short term for scaring the crap out of people.

71 degrees room temp throughout house is - so - last century.
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Massive Human Dieoff must occur as a result of Peak Oil. Many more than half will die. It will occur everywhere, including where you live. If you fail to recognize this, then your odds of living move toward the "going to die" group.

frankthetank

I'll have to get my little guy a fur coat for this winter Smile

I've been watching it every day i noticed the drop too. Thought it was just following oil down. Even $12 is WAY higher then last winter when it hovered around $7. The deal is that if you don't have your own woodlot or have close easy access to wood, there really aren't many alternatives.

People will jump to electricity for heating. I've noticed furnace commercials on TV about new furnaces that chose between gas and electricity depending on cost. That'll just drive coal/nuke through the roof when demand skyrocket.

Mother nature always wins.
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jdmartin

Plantagenet

People interested in natural gas should find out about the natural gas pipeline system being proposed between Prudhoe Bay and Chicago.

This project has been planned for decades, but its moving now. The state of Alaska may decide within a couple of weeks to accept the proposal of TRANSCANADA pipeline company to build a natural gas pipeline from Prudhoe Bay (huge natural gas resources) and Alberta, where the gas could go into existing pipelines to supply Chicago and the midwest.

This will be a huge megaproject.

Anybody who knows how to weld has one more chance to get rich quick.

OilFinder2

US Natural Gas Production.

Source

--> Thread of interest <--
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"And with gasoline almost assuredly being over $3.00/gallon in the winter . . ."
joewp, June 17, 2008

smallpoxgirl · Moderator Joined: Nov 08, 2004 Posts: 6812

That's an interesting graph OF2. So your take then is that storage levels are low because demand is way up? There seems to be a pretty clear arbitrage between natural gas and oil. As one goes up in price, people will switch to the other.
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Sifting through the ashes every day
What we thought would never end
Now is nothing more than a memory
The way things were before
I lost my way" - OCMS

OilFinder2

^
I know next to nothing about natural gas storage. Doesn't seem to be the kind of thing people would try to "store," at least not in large quantities.
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"And with gasoline almost assuredly being over $3.00/gallon in the winter . . ."
joewp, June 17, 2008

smallpoxgirl · Moderator Joined: Nov 08, 2004 Posts: 6812

eastbay

This is a basic primer on natural gas storage from our friends at EIA Smile

Basically...

Natural gas-a colorless, odorless, gaseous hydrocarbon-may be stored in a number of different ways. It is most commonly held in inventory underground under pressure in three types of facilities. These are: (1) depleted reservoirs in oil and/or gas fields, (2) aquifers, and (3) salt cavern formations. (Natural gas is also stored in liquid form in above-ground tanks.
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