Natural gas climbs as long-term demand rises

Demand! It's Only Natural!

The move is yet another example of China's ambition to grab a piece of the U.S. shale gas boom. Just last month Sinopec Group said it would pay $1 billion for some of Chesapeake's oil and gas properties in the Mississippi lime shale. The natural gas bounty is also expected to help the U.S. transport industry off its dependence on diesel fuel made from imported crude oil, and the trucking industry is in a big push to use more of the domestically produced fuel. The potential savings are huge: Shippers can save around $2 a gallon by switching to natural gas from diesel.

Nearly half of the garbage trucks sold in the United States last year run on natural gas. They are able to refuel at dedicated stations at their home bases. To convince the far larger market for long-haul trucking to run on natural gas, truckers need to know they can refuel along their highway routes .Enter ENN, led by billionaire energy tycoon Wang Yusuo. The company has already built natural gas stations in China, which is farther along in its adoption of natural gas trucks.”

A loyal Energy Report reader, George Sutherland, wrote in and said, ”Great piece today — only one caveat. You and many others create the impression that the big breakthrough in the tight formation program is hydraulic fracturing, whereas it is actually due to combining fracking with horizontal drilling. I was involved in explosive fracking programs over 40 years ago in vertical bore holes. The gains come from fracturing along hundreds of feet (or maybe thousands?) of generally horizontal bore holes instead of just the vertical width of the formation, which might be less than fifty feet. That geometrical advantage coupled with improved fracking materials have led to the dramatic increases in production from previously uneconomic formations. I still wonder how effective explosive fracturing would be in horizontal wells." Thank you George! Great point and insight!

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About the Author
Phil Flynn

Senior energy analyst at The PRICE Futures Group and a Fox Business Network contributor. He is one of the world's leading market analysts, providing individual investors, professional traders, and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline, and energy markets. His precise and timely forecasts have come to be in great demand by industry and media worldwide and his impressive career goes back almost three decades, gaining attention with his market calls and energetic personality as writer of The Energy Report. You can contact Phil by phone at (888) 264-5665 or by email at pflynn@pricegroup.com. Learn even more on our website at www.pricegroup.com.

 

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