As the state of the larger economy remains spotty with some possible, but scattered bright spots, the energy industry seems rather positive. This is largely due to the boom happening in the natural gas sector.
‘We have a game-changing opportunity to make the U.S. the global leader in energy,” said the American Petroleum Institute’s president and CEO Jack Gerard in an address at the API’s 2013 State of American Energy event on Jan. 8, 2013. ‘If we seize the opportunity now, we will be positioned to lead for decades and realize the economic and energy security benefits of that leadership.”
The Energy Information Administration’s early release overview of the Annual Energy Outlook 2013 is very heavy on natural gas projections. Some of the highlights from that report include a sharp rise in crude oil production over the next decade, due to advanced technologies focusing on onshore production, particularly from shale and other tight formations. This lifts their projected domestic supply, with annual growth averaging 234 thousand barrels per day through 2019.
EIA also projects the increased use of natural gas in the industrial and electric power sectors in the next 15 years because of the growth in production and low gas prices. These low prices also encourage the prediction of industrial production expanding in response to the initial competitive advantage. This growth was also reflected in the comments of API’s Gerard.
‘Manufacturing can and is returning to the United States; Shell, Dow, U.S. Steel and others have all announced or are considering moving manufacturing to the U.S., or planning expansions here at home, for the first time in many years,” he said. ‘These decisions are driven by the availability of reliable and affordable energy.”
Moreover, growth in diesel fuel consumption is projected to be moderated due to increased use of natural gas in heavy-duty vehicles. ‘The improved economics of liquefied natural gas (LNG) for heavy-duty vehicles results in an increase in natural gas use in heavy-duty vehicles that offsets a portion of diesel fuel consumption,” reports the EIA.
Moreover, natural gas exports, according to the EIA’s report, will be larger for the U.S. than previously projected.
‘Producing more domestic energy provides opportunities for the U.S. to increase its exports and serve new markets,” said Gerard. ‘By developing new technologies to access potential new sources, like oil shale, we will be able to dramatically increase our energy potential and role as the global energy leader. Oil shale in the Western United States is estimated at more than 800 billion barrels, or nearly three times the proven reserves of Saudi Arabia.”
Gerard also said after his address that the most important thing that Congress and the Obama administration does is ‘no harm.” He cautioned them not to act in any way that would impede or discourage the development in natural gas right now.
‘We are at the crossroads of a great turning point in our nation’s history