The oil and gas industry also have the following nightmares (to them) starting to come true:
International Energy Agency (founded on tracking petroleum access for western nations) "The IEA finds that global offshore wind capacity may increase 15-fold and attract around $1 trillion of cumulative investment by 2040. This is driven by falling costs, supportive government policies and some remarkable technological progress, such as larger turbines and floating foundations. That’s just the start – the IEA report finds that offshore wind technology has the potential to grow far more strongly with stepped-up support from policy makers."
https://www.iea.org/news/offshore-wind-to-become-a-1-trillion-industry
Helped by stepped-up support? The EU is trying to be carbon-neutral by 2050.
https://www.wsj.com/articles/eu-to-cut-greenhouse-gas-emissions-to-zero-by-2050-11576203017
In the US, the Northeast is great for offshore wind, because of topography and available wind, but also because all that energy sits next to all those big, densely populated coastal markets. Run a cable to the grid with much less permitting hassle than trying to run risky gas lines through cities and towns.
As small drillers (at risk of bankruptcy) fade away with the gas production, states will face cleanup costs.
https://www.desmogblog.com/2019/10/18/public-paying-cleanup-fracking-boom-oil-gas-bonds
All this plus EVs will be net cheaper than gas cars in the next decade or so.
We're leaving fossil.
3
I'm thinking of the activists from Pennsylvania whom I met some years ago, when I joined them in a demonstration against fracking. We were outside of a state office building in Long Island City, a group of about 10 people.
The Pennsylvanians were dealing with contaminated water, so polluted they could set the water coming out of their faucets on fire. Their animals were dying where they had previously grazed.
These individuals could see what was going on, but no one was listening.
A man exited the building, and wanted to know who we were, and what we were protesting. When he heard about the water, he exclaimed, "But the oil! The OIL! Without oil, we cannot live!"
"Don't worry," we told him. "If there's no water, you won't need any oil."
3
Seems like a no-brainer, but it would be better for the environment, and for human health, if countries like China would convert their coal-fired electric plants to natural gas. In the long run, even natural gas should not be burned, but still it is better than burning coal.
1
So in a time when we're supposed to be slowing down our use of fossil fuel, Exxon and Chevron are overproducing? How much longer can oil companies ignore the damage they're causing? Who am I kidding? Just asking that question feels empty and pointless. We could all take a play out of the Mormon playbook and start hording food. The next few decades are going to get rough.
Thank God for the supply
Suddenly the Green New Deal isn't looking so foolish.
2
These are gas and water separation tanks on apparently a fracking site.. Low pressure.
On fracking site, water and gas, some oil, pumped pushed into tank.
Separated . Water reinjected.
Not gas tanks.
You might change yr caption to clarify.
2
Hey, Trump voters. How's that energy policy goin' for ya' now?
1
Time to short the oil companies Aramco included.
Excellent reporting that is unavailable anywhere else. Thanks for a truly great news article.
1
Cheap natural gas is better than expensive natural gas for the average American.
3
Please refer to my comment for the accompanying article regarding methane discharges. To iterate, I have been working in the oil & gas industry for 30 years as a Health, Safety & Environmental Professional, yet will never cease to criticize the industry when criticism is due. That said, I have always been concerned regarding the way the media distorts and misrepresents the facts when addressing these problems. The inaccurate reporting distorts a truth that is already concerning enough without the media misrepresenting, and let's face it, sometimes lying about the problems in order to stimulate hysteria in the public. Your inaccuracies are no less concerning than the O&G industry's efforts to minimize these problems and lie to the public. For this particular article the first mistake you've made was to indicate that the tanks in the photo are for "natural gas" (methane). They are not: those tanks contain liquid crude oil and a little bit of water. I subscribe to the NYT and am grateful for your reporting. If you would like to retain a technically knowledgeable professional to critique these types of articles so that you can "get it right" without inaccuracies that serve to discredit your reporting, please contact me at the email address associated with my NYT account. The problems created by the O&G industry are egregious enough that you don't have to lie in order to make the issue palatable to the general public.
4
It's crazy that as a country we're awash in natural gas, yet a large percentage of the country's residential sites don't even have natural gas available. The federal government should establish a revolving fund system to allow natural gas companies to expand their piping system so that more people have natural gas available to their homes (similar to the electrification effort a century ago). That'd be a lot more efficient, cleaner, and far less expensive to end-users than their current home heating choices (electric and propane).
6
@Jack -- that's precisely what we should NOT be doing.
Natural gas pipelines are being fought in many states, and that's fine, because the use of gas for heating should be done away with over the next few decades as we switch to renewables for our electrical systems. Electricity for heating is already cleaner than gas in states that have high mixes of renewables and/or nuclear, so why slow that progress?
The federal government should establish a price on carbon emissions so that consumers will be inclined to do the right thing, despite the propaganda and promotions of the oil and gas industry.
The risk of investing in tons of new pipelines and distribution systems is they then represent a substantial risk to consumers, since the threats to the artificially low prices on gas now can end for a variety of reasons, like:
- increased LNG exports tie us to global prices and price shocks
- investors demanding the non-existent profits means that money flow can shut off soon, until prices rise to profitable levels
- the increasing need for truly-clean energy (non fossil) means the lifetime of any gas investment is iffy.
New renewable power is already cheaper than existing coal plants, renewable+storage is cheaper than gas peaker plants, and utilities are starting to view new combined cycle as risky investments. All this as renewable and storage technology are nowhere near done decreasing in costs.
New gas distribution is a bad idea. Don't waste our tax dollars.
13
Gas is a nuisance byproduct for the shale oil producers in Texas. They can’t give it away, and when they finish drilling and fracking the pipelines aren’t there to take it away. They need to pay back their loans for the drilling so they request a permit to flare off the gas including the hydrogen sulfide which causes terrible air pollution problems in West Texas. These flaring permits for 180 days are never denied. Alternatively, the sour gas could be stripped of hydrogen sulfide, compressed at the wellhead with portable equipment, and transported by tube truck across west Texas to a nearby wind farm that just happens to have a good connection to the grid and huge surplus capacity every day when the wind dies. Burning this now clean gas in a gas turbine for electricity would directly replace pipeline gas burned every day by “peaker plants” when the wind dies. Our wind farms can come to the rescue dramatically increasing their electricity output in the middle of the day when it is needed. Sulfur dioxide poisoning in west Texas would stop. In Texas alone, where more than 20% of all gas produced is vented and flared, 12 million tons per year of carbon emissions would be avoided! Texas would realize the royalty revenue from this lost gas. Well head compressors and tube trucks can move this energy to market while still making some money - maybe not the outsize profits that drive the oil industry but money nonetheless. I’m quite sure I’m not alone working on this solution.
27
New York's decision to not join the fracking fad looks like a better and better decision.This boom and bust business model described in the article is typical 21st century capitalism where companies only want to maximize profits NOW for the current execs instead of planning for solid long term profits. As fossil fuel gets used up there will always be a need for some petrochemicals and eventually safely extracting gas from shale will be feasible. Then the gas will be very valuable.
31
Some commentators are seeing this as a failure of capitalism. I'm no defender of the 'free hand of the market' view, but it is important to note that this glut is not about what happens when the market is let to fend for itself. If that were true, we'd be voluntarily switching to the cheaper wind and solar options since oil extraction's overall costs outweigh its returns.
The oil and gas industry is able to take the risk of investing billions into fracking and over-extraction because - and only because - governments lend them money to do so: they build pipelines, they give tax breaks, shield them from damages costs, they pass bills and legislation that prop up the failing coal industry, and they gear their foreign and domestic policies around fossil fuel sales.
This is about a failure of corporate welfare. The market wants renewables. With luck, this is a sign that the anti-free-market, pro-fossil fuel system will find itself crushed by supply and demand economics.
34
Fantastic article. New studies are also showing that solar storage can compete with natural gas peaker plants in the electric sector. Peaker plants typically operate for a small percentage of time. It is strange that the conversation has shifted from Peak Oil meaning running out — to peaking referring to the moment when petroleum usage will peak and start heading down because of renewable integration.
87
Years ago, when the PA natural gas craze was in its infancy, and gas companies were promising land owners oodles of money if they leased their land..I heard a lecture at a local GIS conference. The crux of the lecture was that natural gas and all its benefits (jobs, local economy, etc) had about a 50 year life span. After that the tiny PA towns that would flourish eventually will go bust.
Well...
what do we have now ?
-Not so many jobs to locals
-Ruined environment
-Not so great local economy
-Locally leased lands not making thousands of dollars a month
-And according to this article, the supply running out earlier than expected.
????
No words.
68
Look on the bright side: if the locals are stressed and miserable in rural PA, that probably means more electoral votes for Trump should he manage to run in 20, or for Pence, if Trump cannot.
2
@Pottree Like most Trumpists your up is down for most of us.
6
Heralded as the fuel of the future? Who did the heralding, the geniuses in the oil companies?
3
I always wondered about the pace and zeal with which fracking was brought out—behind closed doors in the Bush Administration. Are the energy companies ahead, did the break even or was there a loss? $10 billion is a lot to write down.
3
The facts are (look it up) that the conversion by industry and power generators to natural gas and away from coal and other more carbon intensive fossil fuels, has resulted in - by far - the greatest reduction in US carbon emissions over the last decade. In fact (again, look it up) the reductions in US carbon emissions due to the conversion to natural gas were primarily responsible for the US already being on path to hit the Paris accords target numbers, before the accored was ever signed. 40 years ago, environmental cranks were declaring "peak oil" had already been broached and that the world was threatened with a new ice age. Remember that next time a contemporary crank warns "we are all gonna die" if we don't (insert idiocy here) immediately.
2
You can count on Republicans to blame the glut and market decline for gas on environmentalists. That, along with a push for coal as a replacement fuel, when what we really need is a replacement of all politicians advocating 19th century solutions to 21st century problems.
8
I understand the need for bankruptcy laws, but over the last 12 years they have become far too weak. The country should not have to pay (and we do when a company of this size declares bankruptcy) when a company takes on too much risk. Bad decisions have consequences, or at least should.
On a bright note, maybe fracking will stop and our waters will stop being put at risk for pollution.
PS Does this glut mean my gas bill will go down?
2
Taking a step back to consider global warming, we seemed to be wired for NIMBYism and for believing there are "silver bullets" to solve our biggest problems. Even calling a problem "global warming" is not enough to override our NIMBYism circuitry in public discussions.
Replacing coal-burning with natural gas will not save us from severe effects of climate change. Neither will electric cars as long as they ultimately run on coal or natural gas (they all do almost everywhere in the world). This does not mean these technologies are useless, but the decisions to use them should be based mostly on economics and local pollution concerns instead of an illusion that they are saving the planet.
Conservation, renewables and nuclear energy will make a big difference with global warming in the energy/transportation sectors are what can make a huge difference. Massive policy proposals to prop up natural gas might fool urban voters in the same way today's mediocre electric cars have, but it would be far better to make harder choices that can have a far more significant impact.
2
Fantastic news for the consumer, switched from # 4 oil to natural gas four years ago. My fuel cost have fallen in half and the carbon commissions at my chimney are down by 65%. Once The USA gets its act together on exporting liquefied natural gas the prices will go up.
4
"Future regulations or a carbon tax put in place by lawmakers worried about climate change..."
Wow. The only mention of climate change is that lawmakers "worried" about climate change might act.
Clifford, are you really unaware of the recent (and not so recent) reports about the dire climate situation? If we're to avoid the worst of it, fossil fuel companies are going to have to write off most of their reserves as unusable. Is this really not part of the story?
Articles like this are part of the problem.
6
Perhaps the NY attorney general should be suing Chevron for misleading investors rather than the spending so much time on the spurious case against Exxon.
2
Capitalism at it's finest.
Incentive for profit along with some oversight can create long lasting rational benefits for society ..... and profits. This gold rush mania is not how to get things done.
3
"a global glut of gas" vs. "a global glut of coal and oil"
Which do you prefer?
"“competition from other fuels and technologies, whether in the form of coal or renewables, loom large.”
I'm from Missouri.
2
Whether it is economic to do so or not, all natural gas produced by oil or gas wells or industrial processes should be gathered and used productively or stored until it can be used. Emitting additional CO2 or, worse, methane, into the atmosphere is bad enough. Such emissions that produce no economic value is inexcusable. If producers can't afford to operate the wells or processes without producing useless emissions that generate noting of value, those processes should simply be stopped.
8
On the cusp of several major climate change tipping points, overproduction by fossil fuel companies results in gas being burned off immediately because it's cheaper than taking it to market.
Remember this the next time someone touts the miracles of the free market. Or the next time you're told that free market innovation will take care of the problem.
9
If energy companies are the foxes, then consumers and the environment are the hens.
3
My natural gas bill has doubled the past few years despite cutting use by 20%. Wonder why.
3
@The Poet McTeagle
Because you live in California. Gas costs are only 40% of what you pay. The remainder is the cost of delivery and regulatory mandates.
2
@The Poet McTeagle - Because you live in California. Natural gas Prices in NYC have fallen by more than half in the last 10 years.
2
It needs to be made clear that natural gas is NOT clean energy. While it doesn't produce dirty hydrocarbons, it still produces Carbon Dioxide (a greenhouse gas) and heat, both of which add to the climate problem.
7
@JustJeff
And it should be above-the-fold headlines that upwards of 30% of extracted natural gas is lost to the atmosphere between the wellhead and the consumer.
30%
7
Natural gas is itself a hydrocarbon. Methane(natural gas) in the atmosphere is multiple times more powerful as a greenhouse gas than carbon dioxide. By its extraction and release to the atmosphere, before it is even burned, it constitutes an existential threat to mankind.
5
With that information in hand, my only question is why the Trump Administration is still doling out drilling rights, especially in scenic areas or where wildlife and fish would be threatened?
Maybe there is the dreaded quid pro quo: If you donate to my campaign, we'll give you drilling rights.
8
@Tom Q
Irritating liberals and environmentalists is a big part of Trump's strategy and appeal. Whether it helps anyone is a secondary concern.
2
It will be nice if humanity can survive the coming climate crisis. It will be even more wonderful if those survivors can benefit from the lessons of the stupidity of humanity for the last 60-80 years.
The world that emerges from the climate crisis will be very different from the one we occupy now. We need to face the fact that humanity may not be part of that equation if we don't act quickly and swiftly.
5
Buried in paragraph 19: "Of course, low natural gas prices have been a boon to users of the fuel"
Combine the above statement with the fact that nearly half of all U.S. households use natural gas to heat their homes.
This means 65 million households are benefiting greatly from low natural gas prices.
The pro-corporate spin from this piece ("U.S. Glut Sinks Profits") is laughable.
2
The problem with the low prices, is that we aren’t paying to clean up the waste that is produced by drilling, transporting, and burning the fuel. We are insisting that our descendants clean up our mess. I was taught differently.
Would you be willing to pay for cleaning up the waste produced on top of the price you are already paying? Would that still be cheaper than other sources? Or don’t you care.
3
@John
Many of the gas producers are also in the gas delivery business. Only 1/3 of my gas bill is product; the rest is delivery and billing. They'll get their $$ one way or another.
What about natural gas hybrid cars?
2
What kind of person would ever trust a company like Chevron with making honest and straight forward healthy choices for our planet?
The reason these morally bankrupt corporations survive are crooked politicians and Americans short term memory.
7
Energy policy has always been a dumpster fire in the US forever. Even with this glut, the proven reserves of natural gas in the US are about 15 years of consumption. Oil is even less.
Planning for future energy needs just doesn't exist.
5
I would have thought big, powerful fossil fuel corporations were smarter than that. I suppose their greed was so excessive, it overwhelmed business sense.
Unfortunately, although the profits were elusive, the destruction of land, waste of limited water supplies and release of methane into our atmosphere are all too real and much longer lasting than even the mighty oil corporations.
And the cost to government? Well, it's unlikely Exxon, Chevron and their like would have paid taxes even if their profits had materialized. However, now with bankruptcy, we can expect to be bailing out these too big to fail corporations.
5
I remember reports on Marcellus shale gas extraction by Clifford Krauss in the NYT, starting in 2008. They always had a narrow perspective, and they often made industry supporting assertions. A casual reader would infer from this article that the shale gas mining industry was profitable through most prior years, and that the very low price of gas is a recent development.
To the contrary, Companies that extract dry shale gas in the Appalachian Basin have not made a profit from extraction and distribution, and except for 2008, the well head price has plummeted. Rather, they have operated by accumulating massive debt, and it is a mystery why investors keep throwing money at this losing business model. We have seen 11 years of debt accumulation on extraction operations that followed three years of debt accumulation in efforts to buy up hundreds of thousands of acres in leases.
Indeed, Chesapeake, the leading shale gas Company in 2008, only made money buying leases and reselling them at a profit to the French, Norwegians and Chinese Companies, not from shale gas extraction itself.
Since 2008, the industry has desperately tried to build markets for domestic use and export of dry shale gas. All have fallen flat.
Meanwhile, billions of dollars of investment has gone to building infrastructure for this polluting methane that is neither a solution to the Climate Crisis, nor a bridge to a solution.
Invest in renewable energy!
11
I live in the center of fracking in Western Pennsylvania, the promises of riches for those who leased land turned into a big lie. Fine print in the leases meant the royalties dried up. Our county roads were ruined by the water trucks and heavy equipment. We don't know what is in the fracking fluids and we don't know where they were disposed of. The big frackers did wonderful public relations before they ruined the area. It is nice to have low utility prices, but the cost was way too high.
16
@Art Seaman
Same in Greene County, PA. Nearly killed by a sand truck this morning.
2
A strong supply of a commodity is a positive, not a negative. Free the energy market, and consumers will benefit.
4
@DAVID E. SHELLENBERGER , Yeah, except those that require a habitable climate.
1
Where's T. Boone (Slim) Pickens when you need him? Oh, yeah, six feet down in an untapped gas well. Can't beat 'em, join 'em.
1
Frack gas has always been a financial scam.
Now it cannot be hidden.
6
Typical American business practices, most likely the result of unbridled capitalism. Drill, drill, drill until way more than needed is produced then start declaring bankruptcy. Boom and bust. No thought of steady production to meet demands just over produce to make as much money as fast as possible. This is what they call business leadership??
Maybe if they couldn’t write off their stupidity and declare bankruptcy to get out from under it, they would show more wisdom.
12
Time to end subsidies for these giant energy companies. I was an investor in a biodiesel company that lost necessary subsidies when trump took over in 2017 and what followed was bankruptcy. If we ended gas and oil subsidies so that we paid real prices for gas, we would get smaller cars on the road with more transportation alternatives. These companies own our country with their political interests. Time to get back control of our country and make decisions that look to our future and the future of our planet.
10
A success story
1
one of the more illusory benefits promised to us losers in western PA in the downstream of Ohio's toxic coal powered plants was how cheaper gas would cause rates to drop dramatically. this of course never happened, and with all the slapdash drilling and conserva-crock propaganda, we are far worse off than ever for obvious reasons
7
@frank discussion Well if it's any consolation, which I'm sure it isn't, it's happening all over America as the rich smart guys and their paid politicians get richer, the uninformed public continue to get sold down the river, so to speak.
2
@Bella
Happy to say it didn't happen in Oregon. Fracking illegal here with a Republican party so weak and powerless you never hear from them.
1
OK. So this is The Market speaking.
This is Trump's best friends. This is The Real America. The Only One That Matters.
And what does it say?
"We have too damn much energy around here! Nobody can make any money!"
And what do we want to do about it?
We want to head North to Alaska, to the last significant hunk of nature left us, free from corrupt service franchise restaurants and water bottles. Free from cheapie motels and expensive rustic lodges.
The last, the very last, chance our nation will ever have to experience, protect, study original wilderness.
The last chance for many populations of unique flora and wandering faun.
We want to dig it up to give already too rich guys more.
More write offs, more control, more useless, worthless energy.
Because what good is a tree when you can a refinery?
We are, Trump is, rich guys truly are, that stupid.
13
@oogada
Not to mention the nearly $260 Billion in subsidies oil and gas companies are getting this year.
3
Now we MUST shut it down. Sorry. It gives me no joy. But, the responsible adult thing is to do is SHUT IT DOWN.
6
Thank you for this reporting. Well done. Now we have another reason, no.. a desperate need, to vote this wacko administration out of power.
Please continue to expose these feckless US resource asset companies. These impersonal and inhumane corporations are killing us by fouling our air, land, and oceans.
4
Here in NM, our governor is in love with the fracking industry because of the money it temporarily provides state coffers. Even though she promotes herself as a supporter of green energy sources through flawed legislation passed this year, we are being sold a bill of goods because so far nobody in government has the chutzpah to say no to fossil fuels. Fracking continues to pollute our air, permanently damage precious and irreplaceable water supplies and add methane to the atmosphere. A green economy means making the commitment now and not waiting for the next bust as fracking dries up and the dollars fade away once more...some lessons never learned.
14
Time for the Democrats to advocate disallowing the use of natural gas for electricity generation.
Make it a platform issue.
5
Gas is used for peak electric consumption and is a necessary evil. Until battery storage technology improves considerably NG peaker plants will be necessary to heat and cool us on those ever more frequent variable climate days.
Solar and Wind battery storage technology is just not there yet to store and transport variable production to where it is needed most.
10
@clarity007
jeez ! let's be pleased that coal is waning
1
Take huge tax deductible depletion allowances during the good times. Scoop up all the tax relief (theft) from the prospectively exaggerated depleting of assets. Devalue the assets (to their more rational price) during the bad times. Moan loudly about the need for subsidies to shore up prices and shares. Defeat any attempt at a rational renewable policy. Repeat.
19
@hal
Ain't capitalism great?!
Because boom/bust business cycles like this are baked in to our current version of the (not-so) free market.
As always, follow the money, that is, the profits and the subsidies.
5
@hal Socialism for corporations.
The economics of supply and demand will be the hardest part of weaning ourselves off oil and gas. As we use less, the price will drop, and that will induce us to use more again. Depending on how you look at it, this is either a vicious cycle or a virtuous cycle, but left to the whims of market economics, this is inevitable. The gas and oil will continue to flow either until it is gone, or until the government steps in and controls it.
I know that sounds socialist, but if the government can't control a market when it goes berserk, what use is government? We need to find alternatives and slow down the flow, and we need to do it yesterday. Allowing the cycle of low prices to increase demand will not get us where we need to be.
6
@mlbex
It doesn't sound socialist. Socialist would be if the government took over the ownership of the gas fields, and power plants. The right has tried with some success to lie about what "socialist" means. Your idea that only government can regulate the market for public good is straight up capitalism. How can there be no regulation or "pure" capitalism? There can't: not with a functioning market, which requires rules and consistency. In this case consistency is a long-term issue: we can't have efficient markets with catastrophic global warming.
5
@Daniel Mozes : I said it would look "socialist" to counter the Koch-based right wing talking point. To a moderate, I agree, it would just look like the government doing what it should.
That shows how the Koch's and their ilk have muddied the rhetorical waters.
4
Those are water tanks.
Nat gas ‘tanks’ that contain pressure do not have square edges.
6
@George
Untrue. Try Google Images.
The first 50 are all rounded, as per strength of materials and physics dictates.
Of course, the same media that mis labeled these tanks mislabeled 2 or 3 deeper into the list.
1
They've more or less destroyed PA's water. It may not be showing up yet, but you can bet that those wonderful Fracking liquids will be showing up in drinking water down the road. Oh, and since they can't make money on the gas, they're now building "Cracking" plants in the Pittsburgh / Ohio River valley. Why? To make more PLASTIC (because we don't have enough already.) Just more toxins to seep into the water and flow from the stacks into the air and blow eastward. I can't wait to move out of here.
14
The article omits a major reason for the glut
The massive pressure campaign , first by the Obama administration, then by the Trump administration, on Germany , a Nato partner, not to import Russian Gas via Nordstream, and instead to import more expensive
US gas, failed
Nominally, to force Germany to build LNG terminals was concern that Germany would become too dependent on Russia. De facto, it was the response of both US government to massive pressures of the US NG industry, major campaign donor to both parties to find new markets
"U.S. Ratchets Up Pressure to Derail Nord Stream 2 Between Germany and Russia"
The Washington Diplomat June 28, 2019
"Maximum Pressure on Germany Is a Big Mistake"
Foreign Policy Sept 2, 2019, 4:46 AM
4
This is a great opportunity to shut down coal-fired electrical generation even faster, but the methane emissions from drilling and transport activities really need to be regulated and vastly reduced as outlined here: www.nytimes.com/interactive/2019/12/12/climate/texas-methane-super-emitters.html
13
Very interesting article, but completely void of numerical facts. It's obvious that natural gas cannot economically compete with wind, hydro, and solar power, but those should not be natural gases' targets. We need to see the cost per kilowatt for electricity generated with natural gas. Now let us compare that to the cost per kilowatt for electricity generated with coal and diesel fuel. And while we're thinking diesel fuel, let's talk about trains. The motor for a train is electric. It gets its power from an onboard diesel-fired generator. Why can't that generator be converted to run on natural gas?
We have a glut of natural gas. Natural Gas burns much cleaner than Coal or Diesel. My guess is that after the conversions are made, Natural Gas will cost less than Coal or Diesel to perform these tasks. Of course, it's a guess because as I said at the beginning, we don't have the numerical facts needed to make these calculations.
11
@Mark, why do you think we don't have the numbers? I'm pretty sure ExxonMobile knows exactly what the situation is, and the 'calculations' are public knowledge.
You've forgotten that the goal was never to make us energy independent from foreign oil. The goal was short term profit for Big Oil, at the expense of every other consideration.
This should surprise no one; America is full of boom/bust cycles. Whales for oil? Gold strike in CA? Gold and timber in Alaska? Silver deposits in Nevada? Copper and timber and oil.... Natural gas is no different.
We've sold our aquifers to Nestle and dirty, destructive industry. We've done this (and more) because short term profits and white men in expensive suits and expensive cars just appeal to us soooo much!
The numbers are in, but most Americans don't care.
9
Odd headline written from the point of view of businesses: "Natural Gas Boom Fizzles as a U.S. Glut Sinks Profits."
For consumers, this isn't a 'fizzle.' It's nice, no matter how short-lived. For a tiny bit of time, capitalism is working for us. Quite rare these days.
17
Natural gas consumption in the United States grew 12% in 2018, 10% in 2019, and is still estimated to increase by 5% in 2020 [according to The U.S. Energy Information Administration]. So, while U.S. companies that drill for natural may be hurting due to current low pricing, American consumers are using record amounts of this carbon fuel. And, while natural gas generates 34% of America's electricity now, it's expected to reach 39% by 2050.
In short, natural gas is still booming as an energy source, but the corporate players are feeling the short-term pressure of overproduction. The weaker financed O&G producers will disappear, while the companies with stronger balance sheets will gain market share.
19
And the significant damage to the environment, caused by filthy, toxic natural gas fracking with be polluting local communities and poisoning our children for generations to came.
All to feed the never ending greed of hundreds fly by night Wall Street owned fracking companies who have taken their profits, raped the land, and declared “bankruptcy” so they can walk away from the toxic mess they created.
I’m proud of my state of New York who didn’t buy the con, and banned ALL fracking years ago within our state.
I feel sorry for the people in Republican controlled states that were sold down the river on yet another lie.
Sorry folks, the damage that’s been done to your communities can never be reversed.
Vote my friends—
68
@Steven I'm a New Yorker also...and, while we don't frack for natural gas, we have no problem buying the product from neighboring Pennsylvania via pipeline. New York is the 6th largest natural gas consumer in the United States...despite the fracking ban.
4
@Steven The state of New York was all set to frack. Officials thought it was a great idea. It was the people in the Finger Lakes, where N.Y. was already storing fracking wastes from other states, who rallied, and petitioned and yelled loud enough for their voices to be heard, that stopped fracking in this state. It is these people whom we should be thanking.
11
Remember buggy whips?
I wonder where Secretary Ross is parking his loot these days. Think he’s moving out of oil and gas operations, or hoping to maintain profitability by slashing those burdensome and costly over regulations just long enough to dump holdings onto the next greater fool?
12
... and this is the real reason for the US sanctions against the russian gas pipeline Nord Stream 2. Every other reason given is just a lame excuse for forcing Germany to buy expensive gas from the US.
'America first' indeed.
10
@Jurgen
Do you really want to place your energy future in the hands of Russians? Ask the Ukrainians how that's working out. Circulate a map showing the German territory you're willing to cede.
3
@SA
First of all I don't see our energy future in fossil fuels.
If we're talking about energy sources the Russians were always a reliable partner (even during cold war times) and they are much more dependend on our money than we are on their gas. Considering reliability I wonder how to rate the US with the current president. Even if we switch to US sources can you guarantuee that Mr.Trump will not use it to blackmail us once we're dependend on US gas deliveries ???
You probably don't grasp how much trust the US already lost in Germany under his presidency...
1
The glut provides a splendid opportunity to suspend any further fracking in the vital interest for fighting climate change. Also overturning Trumpian loosing of regulations to limit leaking of methane into the atmosphere is most urgent.
35
So based on the US-EIA (https://www.eia.gov/outlooks/steo/) in absolute terms gas will increase to provide an additional 5% of US electric production (to 39%), while non-hydro renewables (wind, solar, biofuels) will increase to provide an additional 3% of US production (12%).
So unless you account for the small base of renewables (9% of US production) compared to gas (34%) to speak in relative terms, the article statement "But renewables are climbing even faster" is a tad misleading.
7
@T R Carr
As a percentage of current use, renewables are rising faster. It is a ratio. Renewables from 9% to 12% vs natural gas from 35% to 39%. 3/9 is a larger number than 4/35.
1
Technology is amazing! The United States leads the world in the reduction of carbon emissions due to natural gas. U.S. electricity prices are some of the cheapest in the world due to natural gas. We are now exporting natural gas to countries that prefer our security of supply and sanctity of contracts. Game changers for the global environment, economy, and politics.
5
@Steve It is amazing, I agree. What remains to be seen is whether it will save us, or kill us.
1
Writing down assets to actual economic value does not mean the assets will shut down or go away. You take your economic lumps now, and it eases the path toward additional investments if they make economic sense going forward.
Here in Vermont, outside the Burlington area, there is no retail natural gas distribution. We are highly dependent on #2 heating oil and propane. Expanding the local gas grid would save money for consumers, and, displace a more carbon intensive fuel with less carbon intensive natural gas. There are industries that will only locate to where natural gas is available. And yet we have our protest movement wanting no new fossil fuel infrastructure. So, if it were up to them, Rutland Vermont, for example, would continue to burn that heating oil to keep warm. They support heat pumps, but the coincident electrical demand from 50,000 new heat pumps would require peaking generation capacity for those peak days, burning, guess what, fossil fuel.
Clearly the industry wants to liquefy and export this excess gas. So the tree huggers would deny Americans access to our own gas, and it would be sent overseas to benefit foreign economies, and putting the same carbon in the air elsewhere.
Makes no sense.
12
Typical natural resource extraction syndrome. Make as much money as fast as you can until you can't make anymore. Then declare bankruptcy and leave an environmental and economic mess in your wake.
In manufacturing, successful businesses adjust output to meet demand. They invest in production to meet that demand and no more. In the fossil fuel industry it's go like crazy until everything collapses.
Gas and oil does not have to be a boom and bust industry, but that's how its run. Go, go and go some more. Drill baby drill. Then what happens when you can't sell the product?
Add to this wild west attitude is a complete disdain for environmental regulations. Those would reduce profits a bit. Can't have that because then they can't drill baby drill with complete abandon.
Truth is, the world is awash with enormous resources of gas and oil. Then Trump wants to open up the most sensitive arctic areas to drilling to produce product that the global market cannot absorb. We even have Koch producing oil from tar sludge in Canada that no one needs. We have farmers growing vast amounts of corn, rapidly depleting groundwater, dumping chemicals into the environment, which the world doesn't need, and consuming more energy than it produces.
Drill baby drill is killing us. It is exploiting local populations with its boom and bust cycles. Government refuses to regulate. Investors keep pumping money into it the get rich quick scheme. Until it isn't.
95
@Bruce Rozenblit
Push to not allow the consumption of natural gas in MO.
Meanwhile, the cost of renewables and energy storage continue to fall, the market place will slowly lead the clean energy revolution. We will still need a solution to replace the rampant emissions of airplanes and ships, which will come into focus as the energy ecosystem changes. Oh, and don’t forget that automation is slowly disrupting the huge factory model, local, customized production is now a reality.
14
Should be an uphill battle for the petroleum, natural gas and coal industries going forward.
Perception and truth sometimes commingle and this is one of those times. Carbon based energy supplies are recognized as contributing to climate change by everyone except the carbon energy sector and the lesser minds amongst us.
This is especially true of all generations that come after the baby boomers, the last holdouts.
And perception is everything.
Gasoline, natural gas and maybe coal may buck a downward trend and spike sometime in the near future but this spike will be short lived.
Once all of the automakers have an electrical offering in their lineup, it should be game over for the carbon industry and these large tracks of land and associated mineral rights will be heavily devalued.
If I was a betting man today, I’d place my bets on (1) electric motor efficiency, (2) battery efficiency, and possibly (3) molten-salt nuclear reactors.
As for carbon? I’d sell now or real soon.
p.s. (4) short sellers in carbon should do well also.
10
So big companies are writing down their debt (love the language, sounds almost like journaling) and the smaller companies are worrying about where their next billion dollar refi is coming from. Some stock prices tanked. Fracking was a ponzi supported by super cheap Fed loans, sold by investment banks. Once again, we're looking at an unpayable debt bubble that threatens considerable harm when it pops.
6
@Ned
Writing down assets has no impact on debt. The writedown is an offset to equity value. Therefore, the people who pay for the write down are the company's share holders.
To have an impact on debt, a company would have to declare bankruptcy, which usually results in a restructure of debt, and dilution of share holders equity value.
8
The article starts with "A decade ago, natural gas was heralded as the fuel of the future." The problem is that herald came true. Cheap, abundant fuel that have less hazardous emissions. That hurts the renewable energy market and the oil companies because it drives the cost of energy down. Hence we have the oil companies trying to reduce their costs by relaxing regulation, and the renewable sector screaming that the FRACKING IS EVIL in an attempt to drive the cost of natural gas back up.
5
This article is deceptive and dead wrong in its conclusions. Chevron as well as other companies write downs are accounting adjustments used to revalue assets, in this case shale gas, to reflect the drop in value due to the drop in natural gas price. The drop in natural gas price is a result of the amazing technical success of fracking these gas shales and has nothing to do with renewables whose costs are still not competitive and make up less than 7% of electrical generation worldwide. It would be helpful is the NYTs had knowledgeable reporters that had less prejudice against oil and gas companies
8
@Mark V: Your 7% number is rapidly increasing. Oklahoma produces 30% of it's electricity from wind right now and it is increasing. If the oil and gas lobbyists would stop hindering solar legislation renewables could easily account for 75% of the states needs in a decade. If renewables enjoyed the same subsidies that oil & gas have received in your state it could happen sooner (no pun intended).
19
Fracking is a filthy, toxic and unnecessary process that will be polluting communities and poisoning our children for generations to come.
All to feed the never ending greed of international oil and gas companies that sell the gas they get overseas, while pushing off their legal liabilities through fly by night fracking companies who take their profits, rape the land then declare “bankruptcy” so they can walk away from the toxic mess they created. And what about the few short term jobs they created? See you later.
How many earthquakes a day in Oklahoma these days my friend? Yes let’s put more fracking wells next to the public schools! Good luck with that.
I’m proud that New York State didn’t buy the con job and banned ALL fracking years ago.
16
@Mark V: Renewables not competitive? Lots of commenters spout conflicting statistics but here's what I know for a fact:
I installed solar on my home 3 years ago at a cost of $11k total, or $7800 after tax rebate. Since then I have paid ZERO electric bills whereas I used to pay around $100/month. The system supplies 100% of my net consumption and will pay for itself in less than a decade at a great savings compared to grid power.
Meanwhile, my local utility is now 40% renewable and climbing rapidly. They are now asking people to shift usage of appliances to midday. Just a few years ago we had brownouts at midday due to power shortages.
3
I don’t get it. If the price of natural gas has plummeted then why hasn’t my Con Ed natural gas bill gone down? Because they are crooks, that’s why.
38
@Mike L You might also want to look at the net amount that all of those "cheap" renewables, producing uncertain amounts of electricity intermittently, really contribute to your bill.
5
They bought a portion of the gas the gas years ago. Betting on higher prices today. The consumer always pays for these bets regardless of the outcome. Capitalism at its finest.
12
@Mike L - because con-ed charges more for delivery than for the gas itself. It's called a rip-off.
4
So coal really is exceptionally inexplicable.
2
@Laume
Except in Trumpland.
1
They also declare bankruptcy and dump all the shut in costs on to the taxpayer while they scurry back to Houston with what ever isn't bolted down under their arms.
There have been articles in the past few years about the whole fracking industry being underwater.
Th only bullet I've seen Governor Cuomo dodge. Thank you sir.
18
This industry was fueled by cheap money from the Fed.Most of these companies were never profitable and would never be. Another example of mal-investment when trillions of free dollars are dumped into banks .Now we are left with scarred land and as a bonus polluted ground water.
25
So far there is no abatement of fracking next to residential areas here in Colorado. We can only hope.
6
The boom and bust of fossil fuels is a fact and S Arabia launched their massive state backed oil company - presumably to the detriment of US workers. Chalk up another sell out and win number One by Trump. And now the gas is being burnt at the well site. Read Maddows “Blowout”. As for stagnant housing prices - slowing economy due to tariffs and the elimination of mortgage and tax deductions. Win number Two for Trump. China and Russia - win number Three for Trump. And Wall Street - artificially inflated to back Trump. The Fed - a Trump appointee when we were fine with Yellan. Future headlines - Trump bankrupted the US - bailouts CB by Russia - just like his failed businesses.
6
I wonder how many residents in PA. got to cash out on mineral rights on property they owned before this all happened. I am not one to look for opportunities to bash corporations but to the extent these write downs are on gas fields that landowners and farmers were able to benefit from the mineral rights there is more than one silver cloud in this story.
3
And the toxic mess left behind will be polluting their communities and poisoning their children for generations to come.
All so a hand full for people can get one time payout of a few 1000 dollars and a “tax break”?
I consulted in this industry for a very short time and I can tell you, fracking is a con job to feed the never ending greed of Wall Street, few small minded land owners and multinational oil companies who sell most, if not all of the “gas” overseas.
Sorry folks, once the damage from fracking is done, it can never be reversed.
3
If there is such a glut in natural gas and it is being over produced, why is our current administration (i.e. Trump and his Republican peers) pushing to lift restrictions on natural gas drilling in environmentally sensitive areas and in our national parks like Yellowstone and Anwar nature reserves in Alaska?
Also, why is our current administration so eager to relax environmental laws to allow the construction of natural gas lines extending thousands of miles to ocean ports where the gas can be exported overseas?
Someone needs to be making a buck on these deals and it’d be interesting to know who. Maybe it is being done so that companies can purchase these publicly owned areas now when the prices are depressed before their value increases in the future.
25
@Greg It may be pandering.
1
What happens when laid off well paid oil and gas workers can't keep up with their mortgages, boat payments etc? They default, sound familiar comrades?
37
Worrisome article on the debt load, bankruptcies of some of these companies. But even more scary is the companion article showing the escaping methane from harmless-looking storage facilities. Absolutely amazing infrared photography.
And you have to wonder why these cameras aren’t required for monitoring.....orphan, unexpected methane releases. They look pretty regular to me, and parentage surely doesn’t take DNA analysis.
Great reporting in both articles. Thanks.
51
And not a single mention of ole Wilbur Ross, the Captain Ahab of late stage capitalism.
10
What we really need is a big consumer market where we can sell our abundant gas profitable.
China is the second largest market for natural gas. Due to the trade dispute, China stopped buying our gas or liquified natural gas (LNG). Instead they signed a long term 30-year gas contract with Russia who will provide gas to NE China and then Shanghai. But China still needs more gas to clean or reduce the environment burden.
Australia is also waiting to ship more gas to China. With rich gas fields in NW Australia offshore, Australia is a rich country in gas. They also needs market.
What we should do is to sign first trade agreement and resume gas shipping to China. It not only reduces the trade imbalance, but also keeps our companies profitable and employees busy.
No wonder Houston housing market is stagnant right now.
4
@Usok - "What we really need is a big consumer market where we can sell our abundant gas profitable."
Yup, that's the ticket. Find ever more ways to burn as much Fossil Fuel as we can as fast as we can while meeting this quarter's demand for short-term profit. Sounds like a plan?
2
Why not just synthesize natural gas into fenatyl and skip all the middle steps?
9
So you want to rape and pillage American communities, poison our children and damage our environment for generations to come, so that a hand full of multinational oil companies can sell American national resources to China?
Well that will make America great again - right
Sorry folks once the damage from fracking etc, is done, it can never be reversed.
6
Fossil fuel companies are taking more or of the ground to drive down the price to compete with renewable energy.
Democracy needs to stop them from manipulating markets in this way, or else we will never make the necessary changes to future technologies.
Countries that invest in themselves are already moving as quickly as possible to renewables, which create nearly free energy, once installed. Countries that let investors manipulate markets and government are protecting 19th century technology at the expense of 21st century technology dooming us to fall behind economically, even as we continue to cause going warming..
Look to the future; not to the past.
10
It’s difficult for the elderly to look to the future, when they’ll be dead anyway, when they can connive some ways to make money right now while recalling the halcyon, profit-laden days of their youth. How old is our Secretary of Commerce, for example?
5
I wonder what will happen to the residents of Pennsylvania who no longer have fresh drinking water due to hydrofracking, after the gas companies leave town? No more job... No more free bottled water (I assume)... What an amazingly short sighted gambit. On to renewables, please!
132
Pennsylvania is now the nation's second largest gas producer, producing enough gas to supply the entire nation's residential needs. And living here in the Northeast, EVERYONE wants to hook up to gas. I would say that is a very good success story. And as soon as NY is desperate enough for more tax revenue, they will start fracking. Of that, I am sure.
7
It’s a success story in locating a needed fuel for our short term needs as a bridge to a a lower carbon future. At the rate of melting at the poles we will need less and less. But who cares about the future let’s just get ours Right Mark?
40
@Mark
You do seem to miss one point in the article. Regardless, the demand for carbon-based fuel is decreasing. I'm glad we will see more of that. In my travels around the Northeast, I see more and more solar panels on houses. You do raise a good point - Rather than rely on carbon revenue, New York, and other states, are going to need other sources of revenue. Maybe a carbon tax?
14
50 year life span for this industry and its benefits. And the supply is running out faster than predicted. What happens now?
I just wonder why the gas companies do not use their own gas to produce electricity (by starting their own gas-to-electricity plants) and then sell us the electricity? After all, electricity travels a lot easier than gas.
7
@Steve
It may be that most of these gas fields are located far from where the electricity is needed, and that the gas companies would need to build an extensive power grid to distribute the electricity where needed. From what I’ve read in the past, the electrical power grid in the US is way outdated and needs a comprehensive overhaul.
2
The burning of all fossil fuel will take a geologic millisecond regardless of demand in the next decade. Next?
8
By my calculation, the price of $2.45 per million British Thermal Units is equivalent to around 0.8 cents per kWh. Is that right?
I wonder how efficient the power station is that converts the gas to electricity.
1
There’s a long way between the original energy locked in the fuel and the light in your house, as bankrupt utilities here in CA can attest, and most of that distance is burdensome, dangerous transmission lines (and equipment). The selling rates of electricity are regulated. The costs mount. Pretty soon the whole thing will be on life support until it is superseded by renewables. Energy companies are beginning their death throes but they will wind up like whale oil and buggy whips in the end.
2
@Pottree excelente articulo