The science underlying the natural gas crisis
The United States is uniquely
vulnerable to natural gas depletion. The appetite of the United States is
great and the domestic natural gas reserves are small. Soon, most of the
natural gas used in the United States will be imported from the other side
of the Earth. The western hemisphere has only a small part of the world's
natural gas, and that part is being rapidly depleted.
Facts about natural gas in
North America
Natural gas is a very desirable source of
energy because it produces almost no pollutants or ash when burned. On a
weight basis it has more energy content than gasoline. The energy comes
from ancient sunlight. Natural gas is mainly methane, the simplest
possible hydrocarbon. The greenhouse gas, carbon dioxide, is emitted when
it is burned, but only half the amount that coal would produce for the
same energy content. Unlike coal mining, the production of natural gas
does not usually damage the environment. Pipeline transport of natural gas
is common although it costs more to transport natural gas via pipelines
compared to oil.
Natural gas is used primarily for
heating. However, the rolling blackouts in California have stimulated the
construction of new electricity generation capacity--almost all of it
running on natural gas. In 1993 natural gas was used to generate 9% of the
electrical power consumed in the United States. In
2003 that figure was 18%. [2] Natural
gas is also the starting point for countless chemicals and plastics--the
most important of which is nitrogen fertilizer. Modern agriculture utterly
depends on nitrogen fertilizers. There would be world wide famine without
nitrogen fertilizers. [3]
There are about 6 million BTUs in a barrel
of oil. In 2003, oil costs $30 per barrel, while natural gas costs $5 for
a million BTUs. The 6 to 1 ratio means you get about the same energy for
each dollar. Electric power plants that use boilers to make steam can
often use either fuel, depending on costs. The efficiency is the same in
either case, about 38%, but natural gas produces less pollution. Many of
the new electric power plants use gas turbines which achieve 60%, and more
if the waste heat is used. However, gas turbines cannot switch to oil or
coal. In the case of electricity generation, natural gas can command a
premium price.
 The
United States consumed 26% of
the world's production of natural gas in 2002 although it had only 3.3%
of the world's proven reserves. Including Canada and Mexico brings
the total to only 4.6%.
Coincidentally, both Canada and the United States have proven reserves
equal to 9 years at current production rates. Mexico has only 7 years. The
United States produced 84% of the natural gas it consumed while Canada
supplied 15% via pipelines. The remaining 1% was imported as
liquefied natural gas (LNG) via LNG ship. It is clear that North America will be
importing large amounts of natural gas in the near future, although North America is
currently almost self-sufficient for natural gas. At 9%, North America's natural gas
reserves are paltry. By contrast, the
former Soviet Union (FSU) and the Middle East have 39% and 36% respectively.[1] [4]
Central and South America together
have 4.7% of the world's proven natural gas reserves. Venezuela has the
lion's share at 2.7%. This is very convenient for the United States
because the sea routes to Venezuela for the LNG ships are short.[1]
Conventional Natural Gas
Natural gas is often associated with the
production of oil. It has no economic value unless it can be shipped via
pipeline or LNG ship. In the Middle East, it is still commonly
"flared" which is to say burned. Compared to oil, natural gas is
more expensive to transport whether via pipeline or by LNG ship. Prior to
1980, the price of natural gas mainly reflected the cost of transport
since the wellhead price was near zero.
There is a possibility that natural gas
will be found in very deep wells in the Gulf of Mexico. Oil decomposes
into natural gas at the temperatures found below 9000 feet, so only gas
exists at these depths. Drilling becomes very expensive and the produced
gas often contains toxic hydrogen sulfide.
Unconventional Gas [5]
Unconventional gas includes coal bed
methane (CBM), tight gas, shale gas, and gas hydrates. It includes
"stranded gas" (gas located too far from a pipeline to be
economic). It also includes low quality gas (natural gas mixed with
nonflammable gas or toxic hydrogen sulfide).
Coal Bed Methane (CBM)
 Coal
underlies huge areas of the United States and all coal fields contain at
least some methane. Currently, CBM accounts for 7.5 percent of U.S.
natural gas production, a figure that is likely to increase. Recent
estimates indicate more than 700 trillion cubic feet (TCF) of CBM in
place, with over 100 TCF economically recoverable--a 4.5 year supply at
present rates of consumption. Canada may have significant CBM resources.
Methane extraction from coal beds is
complex and messy. First the coal is depressurized by removing water. This
releases methane from a volume of coal. The amount depends on cracks in
the coal. Many wells are required because each well can access the methane
in only a small volume of coal. The removed water is sometimes potable but
it is often contaminated by coal dust, heavy metals, or salt. Many people
object to the compressors, pumps, towers, pipes, and contaminated water
associated with CBM extraction.
Tight Gas and Shale Gas
Natural gas is mostly easily produced
when it is found in cavities. However, large quantities may be found in
sand or porous rocks. Wells drilled into these formations produce gas but
only very slowly. Some shales also produce gas when fractured. Fractures
can be produced by hydraulic pressure or explosives. Nuclear bombs have
been used experimentally to produce fractures in gas bearing shales in the
American Southwest. [16]
Tight gas and shale gas could be important in the future.
Methane Hydrates
In deep and cold water, natural gas forms a solid called methane hydrate. Huge quantities of methane
hydrate are believed to exist world's oceans. However, no concentrated deposits have ever
been found. Research continues but no natural gas is currently produced
from methane hydrate.
It does not appear that unconventional
gas will be abundant or cheap enough to replace conventional natural gas.
Gas Production in North America
Natural gas prices have been high enough
since 1980 to justify a major drilling effort in all of North America.
This effort, surprising almost everyone, has not paid off. Here is a chart
that illustrates what is happening in the United States.
The top line shows total gas production.
The colored bands show the contribution of gas wells segregated by age.
The production of every gas well declines with age. But the surprising
thing is that the new gas wells are declining much faster than the old
ones. Gas production has remained nearly constant despite the
contributions of the new gas wells.
Texas is a mature gas production province.
In 1998, and in every subsequent year, it took less than a year for the
production rate of a new gas well to fall 50%. New reserves were
discovered in 2002 but the discoveries equaled only a quarter of
consumption. It is clear; new gas wells will have to be drilled faster and
faster just to keep production constant. Think of 6 straws drawing on the
same milkshake.
Natural gas wells are productive even when
the gas is almost gone because natural gas can move freely within a
cavity. By contrast, oil wells produce more slowly when the oil is almost
gone because oil moves more slowly through the oil bearing rock or sand as
pressure diminishes. It is likely that Texas gas production will fall off
a cliff in a few years. Other United States gas producing areas are only a
little less exploited.
Canada's natural gas exports were 1%
less in 2002 compared to 2001. According to the Energy Information Agency (EIA), Canada's contribution will
be 11% less in 2003. Canada has a gas well depletion problem too.
Ladyfern was Canada's most productive gas field. It was discovered near an
existing pipeline and it was rapidly exploited. Now, production from
Ladyfern is down 70%. Canadian gas discoveries were very small in 2002.
Canada will not be able to take up the slack. [4][11]
Alaskan natural gas will not be able to
take up the slack. Alaska has proven reserves equal to two years of United
States consumption. A gas pipeline to Alaska would probably not pay for
itself. A pipeline would take at least 5 years to build in any case.
Transport by LNG ship might actually be cheaper. [13]
 [1]
http://www.bp.com/ British
Petroleum (BP) is a major oil company that publishes oil reserves data
from the Oil and Gas Journal in its annual Statistical Review of
World Energy 2003. The data do not reflect the company's own
assessments--it is simply republished data. The Review is widely
referenced because it is convenient, complete, colorful and very well
done. It is also big at 2.2 megabytes. BP's CEO, The Lord Browne of Madingley, is irascible and quotable. He says that BP now stands for
"beyond petroleum." BP's new logo, which looks like a leafy sun,
would seem to bear him out.
[2] http://www.eia.doe.gov/
Energy Information Agency (EIA), a part of the Department of Energy (DOE).
This is official energy statistics from the U.S. government.
[3] http://www.princeton.edu/~hos/mike/texts/readmach/zmaczynski.htm
The Haber process is used to make ammonia from natural gas. Almost all
nitrogen fertilizer is made from ammonia. The improvement in crop yields
resulting from nitrogen fertilizer is the reason why there is not
widespread famine in the world today. Ammonia is also the starting point
for almost all explosives. World War I would have petered out for lack of
explosives except for the application of the newly invented Haber process.
It seems the Haber process both creates and destroys.
[4] http://www.financialsense.com/editorials/powers/2003/1030.html
An editorial entitled The
Natural Gas Production Treadmill by Bill Powers. An excellent summary
of the Natural gas problem for all of North America.
 [5]
Click here
to see Energy in the XXIst century--Unconventional Oil and gas, by
J. J. George Stosur. This is based on a lecture to the Society of
Petroleum Engineers by the author. This is a 248k PDF file on this
website, so the link is unbreakable.
[6] http://www.naturalgasfacts.org/links/index.html
American Petroleum Institute natural gas facts. Many useful links.
[11] Click here
to see a history of Canada's
natural gas industry and an explanation of why it is in decline.
[13] Click here
to see Alaskan Natural Gas: How Real An Alternative Is It? by
Joseph P. Mathew. The practical and economic considerations of building a
natural gas line to Alaska. This is an HTML file on this website, so the
link is unbreakable.
[14] http://www.petroleumnews.com/cgi-bin/start.cgi/homeauto.html
Petroleum News is a magazine catering to the Oil and Gas industry
of North America. Click here
to see Supply Crisis Looms which appeared in the May 2003 issue.
This is a short HTML file on this website so the link is unbreakable. It
is significant that an article appearing in an industry magazine agrees
with planetforlife and predicts the
same crisis using similar arguments.
[16] Memoirs, A
Twentieth-Century Journey in Science and Politics
by Edward Teller. Edward Teller is known as the father of the hydrogen
bomb. Teller was a nuclear enthusiast. He also proposed that nuclear bombs be used
to make sea harbors in Alaska and a sea level Panama Canal. He also convinced president Reagan to initiate the
Strategic Defense Initiative (Star Wars)
project.
|
Home