Natural Gas Price Drops Again

from AP, Aug 4 2008:

"Natural gas futures also fell sharply [today], dropping 66.3 cents, or 7.1 percent, to settle at $8.726 per 1,000 cubic feet."

From NYMEX, Aug 7, 2008: (closing price) $8.540 per 1000 cubic feet. Wow. Dropped almost 30 cents in three days.

I added a response on T. Boone Pickens' website www.PickensPlan.com. A commenter using BrianR as his handle stated that natural gas needs no refining, it is brought right out of the ground into pipelines for customers.

Well, that is just not true. I corrected that, stating raw natural gas has several impurities including water, sulfur, mercury (sometimes), ethane, propane, butanes, and natural gasoline. All these are removed by processing in a natural gas plant. Then, the processed gas is odorized to meet pipeline specifications and sent out to the consumers.

I also stated that mass conversion of autos to CNG will require some infrastructure work especially on the East coast. This was in response to those who claim that natural gas infrastructure is already in place. Well, it is, mostly, but it is strained each winter as the north and east get very cold. If the pipelines also had to supply gas for cars, there is not enough capacity.

One solution is to build one or more LNG regasification facilities on the east coast, preferably near New Jersey. But, the enviro-wackos will never allow that.

-- Roger E. Sowell, the energyguy on Townhall.com.