Natural gas industry demanding a bigger energy spotlight

Natural gas is getting organized.

Or rather, the independent natural gas exploration and production companies that took shale gas from impossible to possible during the past decade increasingly are getting together to push the fuel's appeal to new markets.

America’s Natural Gas Alliance is the latest example of the companies’ cooperation. Formed earlier this year, ANGA was created by 28 of the nation’s independent natural gas exploration and production companies that produce about 9 trillion cubic feet of gas per year and comprise more than 40 percent of total U.S. gas supply, according to the group’s Web site.

“ANGA was formed in March 2009 to make sure natural gas has a voice in the discussion going forward,” said Rod Lowman, president and CEO. No stranger to how government works, Lowman previously served as head of several other industry lobbying groups, including the Abundant Forests Alliance Inc., the American Plastics Council and the American Chemistry Council. He also worked as senior federal relations representative with Gulf Oil Corp., now Chevron Oil Corp.

“We may have gotten off to a later start, but we have been very engaged in the Senate debate,” he said. “Natural gas has an important story to tell. It is abundant, clean American resource that can help end our dependence on foreign energy.”

The nation’s dependence on foreign energy appears to be a big topic when it comes to pushing for an increased use of domestically produced energy, especially natural gas. When oil magnate T. Boone Pickens launched his Pickens Plan – a proposed energy plan for the U.S. with reliance on renewable energy and gas – he frequently touted benefits and cost-savings that he said would come from producing more energy on U.S. soil.

The United States spent $25 billion on imported oil during the month of August, which was more than any other previous month in 2009, according to a Sept. 10 newsletter. The U.S. has imported 2.9 billion barrels of oil since January of this year.

“It’s a threat to our national security, and it’s not helping our economy recover,” Pickens wrote in the column. “Oil accounts for over 65 percent of the U.S. trade deficit, which just had its biggest percentage increase in a decade. With unemployment up and hovering near double digits, there is no more important time to harness our natural resources, like natural gas, to replace foreign oil at the pump and keep jobs and dollars on American soil.”

According to a June report from the Potential Gas Committee, U.S. natural gas reserves total about 1,836 trillion cubic feet, or 39 percent more than originally estimated in 2006. That increase comes from a re-evaluation of the potential of shale gas. With the Barnett Shale well into production, companies increasingly are finding new opportunities in the Haynesville and Marcellus shales in Louisiana and Appalachia, respectively.

The goal of ANGA is to increase awareness of that abundance, and the environmental and economic benefits of natural gas, Lowman said.

“In the short term, we are working to ensure that the Senate version of Waxman-Markey includes a role for natural gas, recognizing it as a clean, abundant American resource,” Lowman said. The Waxman-Markey (from Reps. Henry Waxman, D-Calif., and Ed Markey, D-Mass.) aims to tackle climate change by capping greenhouse gas emissions and possibly taxing carbon emissions.

XTO Energy Inc. Chairman Bob R. Simpson recently appeared on CNBC show Mad Money, hosted by the eccentric investment analyst and personality Jim Cramer, to explain how natural gas companies are going to make progress in increasing demand, which has been flat for the past decade, according to the Energy Information Administration.

“My speculation about politics is we’re out-lobbied at the moment, and out-spent,” Simpson said of why coal continues to be the choice for electricity production. He added, “We’re going to catch up and we’re going to educate. But we have a superior product so we’ve got an advantage long term. We’re a little bit behind, but we’re going to catch up.”

Simpson said an $80 million budget will help bridge the gap in lobbying, while Lowman insists it's not about competition.

“We are not ‘taking on the coal industry,’” Lowman said, “but are educating people about natural gas’s abundance and myriad benefits.”

ANGA member companies include a who’s who of shale gas producers, including Devon Energy Corp., XTO Energy, Chesapeake Energy Corp., EOG Resources Inc., Range Resources Corp. and others. For more information: www.anga.us.