Natural Gas Supply In North America

America is facing a severe energy crunch. Natural gas production in the US peaked in 1971. Canada has been increasing exports to the United States; however, in 2002 Canadian gas production declined. That trend continued in 2003. Currently, 80% of all wells are drilled for gas, not oil, but in spite of this increased effort, the production decline has not been reversed.

At the same time, demand for natural gas in North America is increasing. Sixty percent of all homes in the United States are heated with gas, and seventy percent of new homes are designed for natural gas consumption. Natural gas, it seems, is the fuel of choice for electric power production due to its clean burning qualities. Ninety percent of all new power plants developed by 2002 or later are gas-fired.

Another major contributor to current gas shortages is the lack of new supplies from northern Alaska and northwestern Canada. Neither have open access with no existing pipeline access. A pipeline to Alaska's gas is roughly 12 to 15 years away, and Canada's pipeline is not slated for completion until about 2009.

Liquefied Natural Gas (LNG) transported by ship from abroad currently accounts for only about one percent of domestic gas in the U.S. More LNG terminals are planned, but these are expensive, and can take many years to site and complete.

By all accounts, finding and developing new domestic sources of natural gas, including alternatives like coal-based gas, has become a critical priority.

* "North American Natural Gas: Data show supply problems" published in the journal, Natural Resources Research.