[BigTex]

This is great news. OF2, when do you think we will see natural gas prices collapse? I'm already thinking about picking up one of those slick natural gas powered cars.



With a car like that, the ladies are going to be chasing me around like the Beatles. I feel a lot better now.

[copious.abundance]

This is great news. OF2, when do you think we will see natural gas prices collapse?

Dunno.

I'm already thinking about picking up one of those slick natural gas powered cars. --snip-- With a car like that, the ladies are going to be chasing me around like the Beatles.

Gee I dunno. Civic's aren't very sexy cars.

[mos6507]

Gee I dunno. Civic's aren't very sexy cars.

In the future, a sexy car is a car with fuel in it.

[ROCKMAN]

BigTex,

As an expert in drilling gas wells (watching about 2 dozen drilling at the moment) I'll respond to your question re: a collapse of natural gas prices:

I dunno either.

Few in the industry (at least at the worker bee level) are concerned with long term NG prices. NG prices have been steadily rising for a while now (took a big jump since last January...the "high season"). Under current economic conditions there are ten's of thousand of NG wells that can be drilled. The only dark lining to this cloud is the nature of many of these plays combined with improved technology results in a shorter life than conventional NG reservoirs have shown historically. Decline rates in many of the hot NG resource plays can be 25% to 50% per year.

Just as the sun will rise tomorrow there will be a Peak Natural Gas eventually. I'm certain, beyond any doubt, that no one has enough solid info on the resource plays and anything close to an accurate model of NG consumption for the next few decades.

For me, the critical question isn't how fast we can add more oil/gas reserves but how quickly and efficiently can we modify the economy to deal with PO. I consider that aspect to fall in line with the philosophy of the motto of the French Foreign Legion: "March or Die"

[MrBill]

The EU has an energy policy too. It is called a reliance on imports! ; - ))

The European Union's silence over the coupling of oil and gas prices is strange. One of the EU's strong points has been its consistent support for competition. But when it comes to energy, it is a different matter. Due to pressure from Europe's powerful gas companies, the EU has had a tough time trying to open up the sector to genuine competition, even if such a move would bolster the bloc's competitiveness.

The lack of any debate about the link between oil and gas has much to do with Europe's helplessness. As the North Sea fields become depleted, the EU is becoming increasingly dependent on imported oil and gas. According to estimates by the European Commission, the executive arm of the EU, by 2030 over 84 percent of the bloc's total gas supplies will be imported, compared with 54 percent today.

The price Europeans pay for their oil from Saudi Arabia and other countries is dictated not by supply and demand but by a cartel over which the EU has no influence. It has just as little influence over gas that is imported mainly from Russia, Algeria and Norway. While there is no gas cartel as such, an informal one does exist because producers agree to keep gas prices tied to oil.

source: A double cartel holds EU hostage on energy

[ROCKMAN]

Mr. Bill,

A little chuckle to add to your post regarding Norway and their attitude towards their exports to the EU: over 20 years ago the oil patch started referring to the Nowegians as "blue eyed Arabs". A little harsh perhaps but in the opinion of many well deserved.

[ROCKMAN]

emerald (one of my favorite minerals btw),

Here's a repeat of my answer to same question I responded to elsewhere plus a few direct answers:

As an expert (snicker) in drilling gas wells (watching about 2 dozen drilling at the moment) I'll respond to your question re: a collapse of natural gas prices:

I dunno either.

Few in the industry (at least at the worker bee level) are concerned with long term NG prices. NG prices have been steadily rising for a while now (took a big jump since last January...the "high season"). Under current economic conditions there are ten's of thousand of NG wells that can be drilled. The only dark lining to this cloud is the nature of many of these plays combined with improved technology results in a shorter life than conventional NG reservoirs have shown historically. Decline rates in many of the hot NG resource plays can be 25% to 50% per year.

Just as the sun will rise tomorrow there will be a Peak Natural Gas eventually. I'm certain, beyond any doubt, that no one has enough solid info on the resource plays and anything close to an accurate model of NG consumption for the next few decades.

For me, the critical question isn't how fast we can add more oil/gas reserves but how quickly and efficiently can we modify the economy to deal with PO. I consider that aspect to fall in line with the philosophy of the motto of the French Foreign Legion: "March or Die"

Now, to your specific points:

If NG gets to expensive to fire a plant then you shut it down. Of course, that means no more electricity. Many plants can convert back and forth between coal and NG though.

But that brings us back to NG price spikes. We're seeing one right now. Last Jan (the normal "high season") NG was selling for $7.30 per unit. Today it's over $12 per unit...a 70%+ increase in less than 6 months. I've read the primary reason was a big jump in coal prices...which some would explain in part on increased transport/mining costs due to higher oil cost. Thus there would have been the incentive for plants to switch to NG which would thus drive up demand and thus drive up prices and thus maybe push some plants back to coal and thus drive the price of coal up.

The one inconsistancy in this merry-go-round is that coal used to be priced under long term contracts (10+ years). Maybe they're going shorter term or there are clauses for escalation do to production/mining costs.

Another factor for the spike may be seasonal: a lot of southern (especially Texas) electicity comes from gas fired plants. And we are getting into the serious air conditioning season right now.

[Starvid]

The Norwegians are doing the right thing. It is after all not our gas under their sea.

They sell to the highest bidder. So would I. Even if it meant being called an Arab.

[ROCKMAN]

Starvid,

Sorry if I hit a nerve. Normally the "blue eyed Arab"comment was made with an appreciative smile. I personally feel a producing country should maximize their assets for the benefit of their people. As much as we depend upon it here in the US, many countries, especially in Africa, are destroying what little chance their people have to build viable economies by selling their oil to the rest of us.

[MrBill]

A little chuckle to add to your post regarding Norway and their attitude towards their exports to the EU: over 20 years ago the oil patch started referring to the Nowegians as "blue eyed Arabs". A little harsh perhaps but in the opinion of many well deserved.

I cannot remember my post about Norway, but they used to say the same thing about Albertans back in the 70s!
The Greeks used to say that "Norwegians thanked God for giving them the sea, while the Greeks thanked God for giving them Norwegian ship owners." A reference to buying and selling ships at counter-cyclical highs and lows! ; - )

[Starvid]

Sorry if I hit a nerve. Normally the "blue eyed Arab"comment was made with an appreciative smile. I personally feel a producing country should maximize their assets for the benefit of their people. As much as we depend upon it here in the US, many countries, especially in Africa, are destroying what little chance their people have to build viable economies by selling their oil to the rest of us.

Oh don't worry, you didn't insult me or anything at all. My comment also included a little smily face, even though I didn't actually write it.

[hardtootell]

According to this source, Canada has about 7 yrs left of NG before it is OUT. Hmmm could get a tad chilly in suburbia.

http://www.eia.doe.gov/emeu/cabs/Canada/NaturalGas.html

(read down to outlook)

Good thing plans are well underway and well funded (sarcasm here) to retrofit all those millions of home in the next couple of years to prevent people from freezing to death due to imminent supply shortage.

[copious.abundance]

Hope it's OK to bump this thread. >>> Natural Gas Prices Plummet to a Seven-Year Low <<<

This is great news. OF2, when do you think we will see natural gas prices collapse? I'm already thinking about picking up one of those slick natural gas powered cars. --snip-- With a car like that, the ladies are going to be chasing me around like the Beatles. I feel a lot better now.

So Tex, have you bought that car yet?

[shortonsense]

Hope it's OK to bump this thread.

Excellent bump! Premo!! I checked the date on the first post, reality debunking some of this hysteria is now happening with 14 months...amazing!!

It used to take YEARS before the future became the past and we could get a decent giggle out of some pompous prognosticating.....this is progress!!

Although I must admit, the price crash from July/2008 into that winter, all 3 years after peak oil happened, that was a pretty quick one as well....

My God whats next? Pack ice builds? Glaciers sweeping back into New England? The feared 1970's era "Coming Ice Age" hysteria?

[BigTex]

That's a big "W" for the cornies.

Nice work.

Whew!

(For a few years there I was worried.)

***

It's going to take a little time, but I assume that we will start winding down the website, box up the peak oil books and MREs and move on.

I don't know for sure what I'll do next, but I hear that there may be a looming problem with "peak cotton", so I am thinking about buying a year's supply of t-shirts and underwear and reading up on cotton zombies.

[Maddog78]

Well, one thing I would bet on, I bet ROCKMAN isn't watching 2 dozen rigs drilling anymore.

[dorlomin]

ROCKMAN

Now there is a poster I really miss.

[Maddog78]

Me, too.


Maybe this should go in the N.G. car thread but anyway....
I took my daughter's car out for an oil change and gassed it up today.
When I'm gassing it up I see the station has a n.g. pump!
Ha, not even 2 minutes from my house and I never even noticed it before.

[sameu]

You do not need natural gas to make nitrogen fertilizer. It is just the source of energy. Not a feedstuff. You can also use coal or nuclear to make fertilizer.

in the Harber proces natural gas is a feedstock for producing ammonia
ammonia, used for fertilizer and for other purposes

[Tanada]

You do not need natural gas to make nitrogen fertilizer. It is just the source of energy. Not a feedstuff. You can also use coal or nuclear to make fertilizer.

in the Harber proces natural gas is a feedstock for producing ammonia
ammonia, used for fertilizer and for other purposes

That is because they use the Methane as both a feedstock to supply Hydrogen and as the energy source to power the processes. Before they used Methane they went through the Haber process with Coal, often Lignite. Ammonia was also mass produced by electrolysis of water in Norway for generations using off peak hydro electric power to break lose the H2 in the water molecule.