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Letter to the Editor: Natural gas prices

October 27, 2017
Bill Lindley - Wahoo, Nebraska , Traer Star-Clipper

Dear Traer,

Clayton Energy is a full-service gas natural gas supplier. What does that mean? Clayton secures the natural gas supply directly from companies drilling for the supply, transports it through the interstate natural gas pipeline directly to the city. Clayton also understands the needs of municipal utilities and provides the right amount of gas on a daily basis to meet the needs of cities. How do they know what they are doing? Clayton has been in the municipal business for 24 years, servicing only municipalities for that entire period. Clayton has grown to serve 43 municipals in the Iowa area and still serves every municipal they have signed on. Not only are they the largest municipal supplier in the Midwest, but have maintained 100% retention of customers!

Natural gas shale reserves are being discovered in vast amounts. Natural gas used to be mainly in the southern part of the United States and the Rocky mountain area. Today, it's all over the United States. The largest reservoir sits right where the largest market area is, the Northeast United States. The Marcellus/Utica natural gas basin produces one-third of all of the natural gas produced in the U.S. today. That's pretty-remarkable considering that basin basically started in 2009! It is expected to double in the next 10 years! There are several other natural gas shale reservoirs with like kind of gas deposits. In fact, there are several shale reservoirs not being drilled today because the gas is not needed in the U.S. now. Today, we are producing so much gas, that the U.S exports natural gas OUT of our country! The U.S. government estimates that our country has over 100 years of natural gas supplies, if not, more. The story is very similar for oil and propane as well.

Why do we have all this production today vs 10 years ago? Natural gas shale deposits have been known about for decades, but the producers didn't have the technology to "crack the code" on bringing these gas volumes to earth's surface. Years ago, the "Old Way" of drilling a well consisted of drilling a straight line down through the earth and "hoping" to hit a gas deposit. Today, the "New Way" consists of not only drilling down through the earth, but turning the drill bit horizontal and drilling sideways through the earth for up to two miles in a known shale deposit! This technology has been a game changer for our country in not only gas supply, but lower prices as well. The U.S. government's Energy Information Administration (EIA) has lowered their 20-year price outlook for 8 straight years! That's right, the abundant supply combined with low natural gas prices provide for a bright future for anybody that is in the natural gas distribution business going forward.

Bill Lindley

Clayton Energy

Wahoo, Nebraska

 
 

 

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