In the April 2012 issue of NG Market Notes, Director Gordon Pickering discusses the benefits to the U.S. petrochemical industry that can result from the increased demand for natural gas represented by LNG exports.
Natural gas has been proven to be abundant in North America. Although resource estimates vary by individual industry and governmental reporting agency, the basis fact is consistently clear – natural gas in North America (primarily from the growth of shale gas) is expected to be sufficiently for the foreseeable future. The fact that shale gas production has repeatedly exceeded many forecasters’ estimates, illustrates the still limited data and understanding of the vast, low-permeability gas shale reservoirs.
With a large and growing natural gas supply, the key challenge becomes managing the resource and turning it into a sustainable industry. Many would agree the industry and regulators have yet to find a solution to guide the industry for the benefit of the country. As seen in the first quarter of 2012, surplus gas production, combined with weak demand (primarily due to unseasonably warm weather), can significantly depress that natural gas market.
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