Dominion to ship local gas to China

This article from the union of West Virginia Affiliated Construction Trades newsletter was passed along to us by the Wetzel County Action Group http://wcag-wv.org/

It raises further questions about how much natural gas produced in Central Appalachia will be used domestically, or even within the region. There have been many concerns over the last several years about the amount of  oil and natural gas from the Marcellus and Utica that will end up being exported because many countries are currently (and are likely to continue) paying higher prices than domestic users of these products.  Thanks WCAG!

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One response to “Dominion to ship local gas to China

  1. I’ve had a general interest in the issue of gas exports for awhile and have gathered scattered articles that have some relevance to the issue. Here is what non-expert I has learned.

    There has been a surplus of gas produced in the US for the past few (some) years. This situation has kept gas prices – and profits low. Gas stocks are trading on the low side. But, hey, low gas prices benefit consumers and many industries.
    At the same time, there is growing demand for fossil fuels generally – including gas – certainly internationally. And the price for gas on international markets is much higher than it is in the US, especially when selling to China.
    The current increases in gas from shale rock is and will be pushing up the supply of gas which logically would suggest that, in the absence of foreign markets, gas prices and profits will continue to be on the low side.
    Why then is there a boom in hydraulic fracturing? There must be the expectation among oil/gas producers that they will be able to export a sizeable and increasing portion of the gas they produce abroad where prices and potential profits are higher.
    However, there may be a stumbling block. The gas must be liquified before it can be transported by ships to places like China or Europe, etc. The questions then are whether there are enough Liquified Natural Gas facilities to refine gas for export and also whether the companies have the gaslines in place to move gas to the LNG refineries when they are in operation. I don’t know the answers to these questions. But I suspect that there are refinery and gasline bottlenecks now. This could change quickly. There’s nothing like the anticipation of big profits to fuel investment in our capitalist system.
    If the gas companies are able to get their gas to refineries and export it abroad for higher prices and profits, the effects on domestic gas markets will be serious – sooner or later. The excessive domestic supply that exists now will disappear and domestic prices will rise. This will, in turn, have a negative impact on residential and industry users of gas in the US – and on jobs.
    This is a perfect case for thinking about the question of the market versus regulation. In this situation, I favor government regulation. The gas companies obviously favor no effective regulation.

    In a way (I’m jumping around here), Athens and eastern Ohio are right in the middle of these developments. Whether we locals make it difficult for gas companies to frack public lands or to pollute or not, there are larger economic and political forces that will determine the future of shale gas mining and these forces unfortunately reflect the political/ideological position that says “drill baby drill.” In this regard, there is not much difference between the two major political parties,

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