Posted on Friday, 18th December 2009 by admin
Could natural gas become the new, primary fuel for the United States in the 21st century?
It’s possible, if new drilling techniques that have the potential to vastly increase the U.S.’s natural gas supplies are deemed safe by regulators.
Exxon-Mobil (XOM) jolted the energy world with its decision to buy natural gas giant XTO Energy (XTO) for $41 billion. The deal brings Exxon’s enormous financial resources to XTO, which has made a name for itself via its expertise in the new technique of hydraulic fracturing, which enables companies to profitably access much more natural gas from current fields, and access gas at previously cost-prohibitive fields.
Natural gas could represent that new, universal energy form, that is if hydraulic fracturing is environmentally safe. The major concern? The contamination of drinking water wells, and water supplies. Federal and state regulators are currently investigating both well and groundwater contamination at hydraulic fracturing sites, The New York Times reported. Gas companies say the incidence of contamination is minor, but environmental groups says that’s only because the government has only recently started investigating the issue.
Energy Analysis: Think about it — Exxon’s move represents a commitment to a potentially cleaner, domestic, widely-available energy source — with all of the implied benefits for commerce (lower trade deficit), jobs, and the environment (lower emissions). Further, the possible entrance of other, large companies holds out the potential for lower prices, as competition for customers increases. But that’s if — and this is a big ‘if’ — hydraulic fracturing and related technologies are not contaminating well/ground water.
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Tags: Fuel, Natural Gas, Primary Fuel
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