The tremendous amount of natural gas available for capture in the United States has been well advertised by the resource’s price over the last year. The U.S. Energy Information Administration shows that the wellhead price hit as low as $1.89 per thousand cubic feet in April of 2012, pretty much spelling doom for coal companies, which compete to provide fuel for heating and electricity.
Prices have since recovered to $2.71/mcf as of September, indicating a level of normalization in the energy market, but by no means suggesting that natural gas output is slated to drop in the near future. Oil supermajors such as Royal Dutch Shell (NYSE:RDSA)(NYSE:RDSB), Exxon Mobil (NYSE:XOM), and Chevron (NYSE:CVX) have all made aggressive North American unconventional oil and gas plays, and are gearing up to make the “shale gas boom” look like a hiccup compared to what the industry could look like in a few years.
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There are at least four substantive growth areas for natural gas in the near- and long-term. To start with, “there’s transportation, there’s petrochemicals,” said Bill Loveless in an interview with Marvin Odum, Shell’s upstream Americas director, broadcast on Platts Energy Week TV.
The evidence of growth opportunity is everywhere. At least 26 states in the U.S. have expressed interest in or have begun transitioning their vehicle fleets to natural gas. Recently, Pennsylvania began accepting applications for a $20 million Natural Gas Vehicle Grant program to begin converting its fleet away from traditional gasoline vehicles.
A number of major car manufacturers are competing to build natural gas vehicles for use by government and corporate fleets, as well as the mass market. Traditional concerns about fueling infrastructure are being addressed by companies like General Electric (NYSE:GE), which has taken the initiative on deploying effective and efficient natural-gas fueling infrastructure across the country…