Further dampening prices is the increasing availability of the large domestic natural gas supply trapped in Marcellus Shale in Pennsylvania, New York and West Virginia. As the technology to harvest it got more economical, the Marcellus Shale natural gas became cheaper than even other supplies of domestic natural gas — such as from the Gulf Coast — and already has contributed to the falling price of the commodity.“This is probably one of the more exciting times in the business,” Karanian said. “Any time new supply comes into an area, it has a positive impact.”The Marcellus natural gas eventually will become the principal supply source for Connecticut and drive down prices — Yankee Gas is predicting a 59 percent in its winter premiums over the next five years — but the proposed expansion of its transmission system to more widely use the commodity doesn’t include Connecticut.Connecticut is a potential customer for use the Marcellus natural gas, but the current demand isn’t high enough to make a new pipeline capacity project economically viable, Karanian said. Yankee Gas may start a transmission project of its own or make it a joint venture to boost the shale natural gas use in the state.“It is truly a game-changer here in New England,” Cullen said.Because of the widespread use of domestic shale natural gas, the amount of foreign LNG used in the country is far less than predicted, said Damien Gaul, economist with the U.S. Energy Information Administration. Natural gas coming from foreign sources hit a 15-year low nationally in 2009.
The entire article is an illuminating read. Be sure to check out the entire piece. I'm going to turn the conversation in a different direction. A Financial Times blog posted today about talent shortage concerns in the oil and gas industry. One obvious storyline is brain drain through aging. Less obvious is competition from the alternative energy industry:
The oil industry is not the sexiest place to be right now. The combined effect of the BP oil spill, competition from the highly-paid financial services sector and the emphasis from governments around the world on creating green jobs has left some in the industry worrying about how they can continue to attract top talent.Oil companies are now rumoured to be offering staff huge incentives to come and work for them, especially if they are working in the field: DVDs, games, food, drinks, you name it they get it. Understandably so if the alternative for a talented science grad is to work in the air-conditioned offices of a bank or with a small start-up working at the cutting edge of green technology.
There's a substantial policy and workforce development disconnect in Pennsylvania between the shale gas boom and the transformation of the Rust Belt to Green Belt. Renewable energy is sexy and is attracting the interest of college students. Would they consider a more viable job market in fracking? No.
Politicians throughout the Rust Belt are touting the growth of green jobs, not the natural gas revolution. I expect most of the shale workers to continue to come from outside of Pennsylvania. Unless you are willing to leave the state in search of work, I'd steer clear of Marcellus Shale training programs. Career-wise, it is a risky bet particularly with the public money still streaming toward deepening the pool of green energy talent.