Hydrocarbon Processing
Houston Gas Processors Hype Shale at Annual Meet

Wednesday, October 12, 2011

The Houston chapter of the Gas Processors Association (HGPA) held its annual meeting on October 11 at the Pine Forest Country Club, complete with breakfast, presentations by industry executives, lunch, and an afternoon golf tournament.

The last speaker of the day was Kristen Holmquist, Bentek Energy's manager of energy analysis. Ms. Holmquist discussed future prospects for shale energy in light of shale's boom in popularity over the last 5–6 years. Prices for natural gas and coal began to align in October 2010, and shortly thereafter gas prices dove below those for coal. Oil prices remain high, making natural gas more price-attractive as a fuel.

Ms. Holmquist noted that much coal-to-gas switching has been seen in the US Northeast and Southeast. However, high coal stockpiles will limit future fuel switching unless the excess can be exported to China and other countries where coal is in high demand.

Ms. Holmquist also highlighted return-on-investment levels for the various shale plays throughout the US, stressing that liquids-rich wells pay off the fastest. If the infrastructure is developed and the demand forecasts are accurate, the shale "party" will continue, she said.

To this end, gas exports to Mexico and the development of additional LNG export terminals will be necessary, she noted.

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