External events may drive construction of the Alaska Gas Pipeline. The NAT GAS Act, pushed by oilman Boone Pickens is gaining momentum in Washington. The proposed law provides incentives for converting vehicles to compressed natural gas. (LINK: Natural Gas Vehicles for America).
Converting vehicles to natural gas will reduce demand for foreign oil and increase demand of domestic gas. Even the President says he endorses the plan (LINK).
If this measure passes, the price of natural gas may climb back to the $5 to $6/MMBTU range and justify construction of the Alaska Gas Pipeline.
Exporting LNG from North America may sponge up additional excess gas supplies (LINK) and help close the unit cost disparity between natural gas ($4/MMBTU) and crude oil ($18/MMBTU).
Natural gas vehicles, LNG export, and gas fired power generation will combine to redefine the energy equation in North America and maybe, just maybe help justify the Alaska Gas Pipeline.
Sunday, April 3, 2011
The Nat Gas Act
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