By James A. Gibbs 

The world has changed a good bit since I entered the industry as a newly-minted geologist back in 1961.  Then, the U.S. was a net exporter of crude oil, which sold on world markets at a price determined by the Texas Railroad Commission, around $3.00 per barrel.  We also had a healthy economy, a favorable balance of trade and a strong dollar.

Today, the U.S. imports more than two thirds of the oil it requires, creating a trade balance deficit that is roughly equivalent to the cost of the oil we import, weakening the dollar.  Our national security wanes as daily production declines and demand increases, perversely widening the gap.  We humbly beg sales from some of the most volatile and unfriendly countries in the world, while every barrel of oil we buy allows them to set global commodity prices and pours money into the coffers of Saudi Arabia, Russia, Venezuela and Iran… financing schools for terrorists.  Clearly, we need to wean ourselves from as much foreign-produced oil as possible.      

Energy policy affects every human activity, from the heating of food to the production of microchips.  And because of the pervasiveness and interdependence, energy policy affects a broad set of issues, from national security to international corruption. Costs, pollution, health, employment, and a myriad of other issues must be taken into account when considering the nation’s future energy needs.  And with the every-increasing instances of domestic terrorism and violence, much more attention must be directed toward hardening the production and delivery infrastructure of our energy supplies.  

Energy security includes several components: supply sustainability, economic viability, and protection of delivery systems.  

-        Fortuitously, and almost miraculously, technological innovation has opened the door to abundant new energy resources that have made the United States the largest natural gas producer in the world (recently surpassing the Russian Federation).  We now have more than a 100-year supply of clean-burning natural gas that we didn’t know about just a few years ago, existing in geologic basins throughout the country. Wisely produced and utilized, natural gas could provide solutions to most of the energy concerns now present or looming just over the horizon.

-        Improved efficiencies of drilling, completing and processing natural gas have made it possible to supply the market at the lowest prices in years, and many energy analysts believe that current low prices can be projected well into the future. Safe, clean, reliable and predictable gas reserves can restore growth and prosperity to our country.    

-        The issue of total energy security is one which the industry must address more rigorously than was ever previously necessary.  America operates from two almost completely disconnected energy systems:  a transportation network that is ninety-six percent fueled by oil, and an electrical grid in which coal and natural gas are the dominant fuels.  The new abundance of domestic natural gas will allow us to have increased confidence in substituting gas for oil wherever possible in our vehicular transportation, and to use more locally produced natural gas for power generation than is available now. 

Compressed natural gas (CNG) is already mandated for taxies, school buses, fleet and delivery vehicles in some cities, and as more individuals select hybrid vehicles, CNG fueling stations will become more common. The “Pickens Plan” proposes utilization of natural gas in heavy transportation vehicles, fueled in urban areas from central storage and dispensing terminals, and on the interstate highways at new or retrofitted service stations. Currently there are few large vehicles built in the U.S. that can operate on natural gas, but as the cost differential between cheap natural gas and more expensive diesel becomes imbedded in the economy, substitution will occur.

Perhaps an equally significant movement would be substituting locally gas-generated electricity as fuel.  Our electrical grid is the security equivalent of a house left with the door unlocked.  If anyone wished to launch a national blackout, they could coordinate attacks in a few rural areas where transformers are located.  The grid is also easily open to cyber attack. Our grid vulnerability means that should a failure occur, our water, sewage, phone and transportation systems, as well as our medical and most basic economic functions would cease within days to weeks.   

The grid can be made more resilient by “islanding” it into micro-grids in the event of an outage, preventing it from cascading into a catastrophe.  Small, efficient gas-fired power plants could be established near gas producing sources, not only shale-gas fields, but also a multitude of others such as coal-gas plants, landfills, municipal waste treatment plants and biomass facilities.  We would still have a national grid transferring bulk electric power over transmission lines, but would simply build into the existing grid the capability to island and separate when needed.

Natural gas is not only a bridge to a cleaner energy future but is one of the solutions to a sustained, secure energy future for the United States.  That conclusion is supported by an abundant resource base, critical technology development, and capital potentially available for infrastructure investment.  What is needed is public recognition of the promise that the resource offers, and the political will to allow its development and utilization.