Wednesday, December 29, 2010
The United States may be entering a golden age of natural-gas use, which is good news for consumers, but not necessarily for investors.
In the past three years, huge reserves of domestic natural gas have been brought to the surface with revolutionary breakthroughs in drilling technology to produce a 100-year supply of cheap, clean-burning fuel at current rates of consumption, experts say.
Yet despite its huge potential, there are two major obstacles facing the industry—low prices and a push by Washington toward renewable energy.
Many energy experts and government officials see natural gas as only a “bridge fuel” to ease the country’s transition from foreign oil and dirty coal to carbon-free energy powered by wind, solar, biofuel and nuclear sources.
But natural gas experts scoff at the suggestion that the fuel is of merely transitional value.
“The subsidy associated with renewables makes no economic sense,” says Porter Bennet, CEO of Bentek Energy Services. “I think the government right now is picking winners and losers. They think renewable ought to be a winner and gas ought to be loser. They’re making tremendous investments in the form of subsidies to make sure that happens."
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