Shale Gas: A Global Phenomenon
Source: Energy Information Administration
3 | MARCELLUS SHALE
COALITION
Shale Gas Revolution Across the U.S.
Source: Energy Information Administration
4 | MARCELLUS SHALE
COALITION
Marcellus and Utica Shales
• Below the Marcellus
• Bigger, deeper, denser
• One of the last U.S.
unconventional energy
fields
• Particularly attractive in OH
• Success in the Marcellus
will lead to success in the
Utica
Clean, Abundant, and Versatile
Resource-How will things be different?
• Heating and cooling sources
• Light duty and heavy duty transportation Fuels
• Generation of electricity
• Combined heat and power applications
• Feedstock for industries
• Utilization of liquids in Wet Natural Gas
6 | MARCELLUS SHALE COALITION
Natural Gas Fundamentals
Three Industry Segments
Upstream: bringing natural gas to the surface (drilling)
Midstream: storing and transporting natural gas (pipelines, etc.)
Downstream: selling and distributing natural gas (your supplier)
Types of Natural Gas
Dry Gas: Home, business heating and fueling
Wet Gas: Contains Natural Gas Liquids, or NGLs; Raw material for other
products (polymers, paints, plastics, fertilizers, etc.)
Natural Gas Power Plants 46 % by 2035
Natural Gas Vehicles
U.S. has 110,000 (.9167%)
Worldwide 12 Million
Infrastructure (Fueling Choices)
Industrial Feedstock
Shell Picks Pittsburgh Area For Major Refinery
•Several BILLION $ to build the plant
•500 -1,000 Full time jobs
•10,000 +/- construction jobs for several years
•Plus additional downstream Industries with additional
job and state revenue opportunities.
Average Composition
Mol%in Wet Gas Region
Propane, 5.5%
Iso Butane,
0.7%
Methane, 74.2%
Liquids, 25.3%
Ethane,
15.6%
Normal
Butane, 1.4%
Iso Pentane,
0.5%
Normal
Pentane, 0.5%
Hexanes+, 1.1%
Source: Pace Global; NiSource Gas Transmission and Storage Presentation to WVONGA Spring Meeting May 6, 2010 p.5
•Pulp and Paper
•Metals
•Chemical plants
•Petroleum refining
•Stone
•Clay & Glass
•Plastics
•Food Processing
Why Chemical Makers Love
Cheap Natural Gas Mar 2, 2012, 6:00 am EDT
| By Aaron Levitt, InvestorPlace Contributor
Margins at U.S. chemical companies are at
their highest in years due to the glut of
natural gas. New factories are being
planned, and current ones are running at
full capacity.
European and Asian chemical
manufacturers use oil-derived naphtha to
make ethylene.
With ethane prices currently around 70
cents a gallon, it costs U.S. producers
about $730 to make a ton of ethylene,
Every 10-cent drop in the cost of ethane
while manufacturers that use naphtha to
boosts Dow’s earnings by nearly $200
make polyethylene are paying nearly
million.
$1,250 a ton.
Adding insult to foreign rivals’ injury, U.S.
chemical manufacturers can take advantage
of cheap natural-gas-fired electricity to run
their refining operations.
Friday, May 25, 2012
Greg Babe, president and CEO of Bayer
Corp. and Bayer MaterialScience LLC,
speaks May 23 at a VisionPittsburgh event
at the Duquesne Club.
Comparing the importance of natural gas
to the chemical industry to flour in a
bakery, Babe said there’s great promise for
the region’s chemical industry in Shell Oil’s
recent announcement that it has chosen a
location in Beaver County to build a $2
billion ethane cracker.
“It really could signal the revival of
America’s petrochemical industry,” Babe
said.
That competitive advantage stems from the
abundance of the supply, Babe said, which
will help create cost advantages and
provide a predictable feedstock.
Liquefied Natural Gas
LNG is a clear, colorless, non-toxic liquid
that can be transported and stored more
easily than natural gas because it occupies
up to 600 times less space.
EXISTING IMPORT TERMINALS
Today, there are 12 U.S. facilities (and one
facility in Puerto Rico) capable of importing
LNG.
They are located in:
Everett, Massachusetts
At present, the U.S. has one existing LNG
Cove Point, Maryland
export terminal located in Kenai, Alaska.
Elba Island, Georgia
Lake Charles, Louisiana
Gulf Gateway Energy Bridge, Gulf of
Mexico
Northeast Gateway, Offshore Boston
Freeport, Texas
Sabine, Louisiana
Hackberry, Louisiana
Neptune LNG, Offshore Gloucester,
Massachusetts
Sabine Pass, Texas
Pascagoula, Mississippi
You've heard
thisAbout
before: This?
"Shale gas is a
What
gamechanger."
Charles Patton, president and chief operating officer of
Appalachian Power Co. said that as power plants in the
company's fleet and elsewhere are retired, "there's just
a run to natural gas."
Complex Hydro Carbon
Diesel is a complex
hydrocarbon, while
natural gas or methane is
a simple hydrocarbon.
Simply, more carbon
means more emissions
have to be handled. The
future looks toward
hydrogen, minimal
carbons.
Simplest Hydro Carbon
Natural Gas (methane)
has highest hydrogen-tocarbon ratio of any
hydrocarbon
Natural Gas is a Safe Fuel
CNG
• Lighter than air
• Rises (rather than pools)
• Doesn’t accumulate in low
places
• Rich mixture burns off slowly
• Ignites at temperatures of
approx. 600 C (higher flash
point)
• Non toxic
• Odorless-detection fragrance
is added
• Evaporates quickly
Liquid fuels
•
•
•
•
•
Heavier than air
Descends
Accumulates in low places
Rich mixture explodes
Gas and diesel vapors ignite
at approx. 200 C
• Toxic, especially gasoline
• Strong inherent odor
• Evaporates slowly at room
temperature
Target NGV Fleet Applications
•Refuse collection and transfer
•Transit
•Port drayage
•Local trucking and distribution
•Public works (street sweeping, road
maintenance, dump trucks, etc.)
•Airport operations (taxi, hotel/parking shuttle bus)
Oil City NG Fueling within 50 miles
http://www.afdc.energy.gov/afdc/locator/stations/
The Pennsylvania Clean Transportation Corridor will:
•Result in more than $200 million in investment in Pennsylvania’s
economy.
• Have a direct impact on more than 1,350 jobs in Pennsylvania.
• Save Pennsylvania fleet operators nearly $10 million in fuel costs
annually.
• Yield more than $60 million in tax revenue for the Commonwealth of
Pennsylvania.
• Reduce emissions of diesel soot (14.5 tons), 720 Tons Nox (Nitrogen
Oxide) ozone-causing pollution and 21,000 tons of greenhouse gas
NEED PA NG SUCCESS STORIES
The Pennsylvania Clean Transportation
Corridor is a strategically planned network
of natural gas refueling infrastructure
connecting:
Philadelphia
Scranton / Wilkes-Barre
Allentown
Harrisburg
Pittsburgh
This corridor will serve as the cornerstone of
a larger regional clean fueling network
throughout the northeastern United States.
The Right Choice. Right Now
Environment, Energy Security and Economics Drive Local
Governments’ Increased Use of Vehicles That Run on Natural Gas
Refuse Truck fuel usage=8,500-10,000 gallons per year. @$4.00/gallon =
$34,000 to $40,000
Estimated savings between 30 and 50%
Savings by using NG @ 30%= $10,200.00 to $12,000.00/year
Savings by using NG @ 50%= $17,000.00 to $20,000.00/year
Plus buying incentives of $32,000.00 per heavy duty truck and 90% quieter.
As well as the cleaner burning fuel
http://www.afdc.energy.gov/afdc/locator/stations/
ONE Trash Truck using NG will take 325 cars off the road!!