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Weekend: The Inevitable Transition to Natural Gas

Keith Kohl

Written By Keith Kohl

Posted April 9, 2011

Welcome to the Energy and Capital Weekend Edition — our insights from the week in investing and links to our most-read Energy and Capital and sister publication articles.

Editor’s note: For more updated information from Keith Kohl on Shale Gas Stocks, click here…

Is a transition to natural gas becoming an inevitability?

Rather, can you think of another source of energy that can be used on the scale needed?

We’re not going to suddenly stop developing our renewable sources, but the sobering fact is that they are nowhere near ready to replace our addiction to crude.

In 2009, all energy from renewable sources — solar, geothermal, biomass waste, wind, biofuels, wood and hydro-power — made up only 8% of U.S. energy consumption. Also consider that the U.S. was second in the world that year when it came to renewable electricity production.

We’re still decades away from that full shift to renewables… And that’s time we don’t have.

Shale Gas: The Global Phenomenon

This week, the Energy Information Administration called it a global phenomenon. And we tend to agree with them on this one.

On Tuesday, the EIA released its study assessing the 48 shale gas basins in 32 countries. For some, their conclusions weren’t as shocking.

According to the report, technically recoverable shale gas resources in the assessed regions held 5,760 trillion cubic feet. That increase added more than 40% to the world’s total, which now stands at about 22,000 trillion cubic feet.

To develop their own shale resources, those countries are turning to the United States for guidance.

We’ve already seen the massive amounts of foreign investments pouring into the U.S. shale producers during the last few years…

Of course, it’s only natural for the shale gas boom to start here. After all, the U.S. boasts 2,552 trillion cubic feet of natural gas resources — 827 Tcf of which is locked in shale formations.

Taking the Lead in Shale Gas

You might remember that the shale boom took off with the success in the Barnett shale. At the start of 2011, production from Barnett wells was approximately 5.35 Bcf/d.

Now, that production crown has been passed to its neighbor, The Haynesville formation.

Found in Louisiana, the Haynesville is one of several new massive shale gas plays within the U.S. Recently, production rose to 5.62 Bcf/d, surpassing the Barnett in mid-February.

So is there anything that can stop the shale explosion?


We know all about the hydraulic fracturing war raging in the shale basins across the United States. This isn’t news; it’s been more than 100 years since hydraulic fracturing was first used, and more than 60 years since companies began to use it for commercial purposes.

The latest anti-fracking sentiment that has taken hold is just getting underway.

But shale gas is simply too valuable to leave untapped. And in order to bring those shale gas wells into production, fracturing the rock is necessary.

So are we stuck between the proverbial rock and a hard place?

Maybe not… Companies are definitely up to the challenge of improving the production process, and having a certain degree of success. Here’s a perfect example.

Below, you’ll find some of this week’s best investment stories from the pages of Energy and Capital and our sister publications.

Russia’s Greatest Oil Blunder: How Stalin Lost $51 billion Worth of Crude
It’s a story that Russian historians want to forget about, and early investors are cheering about. More than sixty years ago, the Soviets discovered a massive oil field in their backyard, but they were unable to develop it. Today, Stalin’s mistake has turned into enormous profits for investors, thanks to one tiny Mongolian stock sitting on billions of barrels of oil…

Tapping into the U.S. Shale: Moving Beyond Hydraulic Fracturing
The best part about the shale boom is knowing someone will come up with a better, more useful technique to fracture those shale formations… Keith Kohl has found one small energy stock utilizing a revolutionary new technique that could replace hydraulic fracturing once and for all. The best part is that this company is on the verge of breaking into the U.S. shale market.

April 27th and the Fed: This Could Induce a 15% Market Correction
Editor Ian Cooper takes a look at what could happen by April 27th and offers ways to protect yourself if the bull market goes down the drain.

Oil Is One Hell of a Drug: Five Reasons to Buy Colombia
A Wild West of cocaine, paramilitary violence, corruption, and more violence, Christian DeHaemer talks turnaround and opportunity in the booming oil market of Colombia.

Clean Energy Growth: Zero to $250 Billion in a Decade
When it comes to cleantech, America is like that popular kid in high school: rich, well-liked, not worried about the future, and in 10 years, will be surpassed by all its peers…

Libya, Oil and Gold: Reasons to Own Physical Precious Metals, Quality Mining Shares
Analyst Greg McCoach tells investors the best way to own both the physical precious metals and the quality precious metals mining shares.

Time to Short Housing Stocks: Cashing In On the Walking Dead
Real estate’s mind is dead, but its body keeps twitching. Adam Lass shows you how to make change off the corpse.

These 5 Offshore Drillers Are Still Kicking: Drilling The Deepwater Again
Editor Keith Kohl offers investors five offshore drilling stocks worth a second look.

Texas Energy via Toronto: Take the Money and Run
I’ll invest in a wind farm as fast as I’ll put money in coal mine. If it’s a good investment… it’s a good investment.

A Borehole to Hell: The Quest for Abiotic Oil
Stalin set to work building a massive R&D project to study every aspect of petroleum. He wanted to know where it came from, how it was made, and how much reserves there are in the world.

Get Back at The Feds: They’re Big, They’re Scared… and Now They’re Bankrupt
Analyst Greg McCoach explains why any investor who values protection, wealth, power, and freedom shouldn’t wait another minute to invest in gold.

High Gas Prices Set Stage for Zipcar IPO: Perfect Timing for Zipcar to Go Public
Editor Jeff Siegel discusses the latest alternative transportation IPO.

Enjoy your weekend,

keith kohl

Keith Kohl
Editor, Energy and Capital

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