Policymakers and regulators are coming up with half-measures to improve conditions in the natural gas market, while in the meantime the “ship is going down,” said an executive with Dow Chemical last Monday.

“They’re telling us, ‘Be patient with these half-measures [in the Energy Policy Act]… We’re doing the easy things. We’re not doing the hard things,'” Peter A. Molinaro, Dow’s vice president of federal and state government affairs, told NGI at the Department of Energy’s meeting on gas supply and demand in Washington, DC. The policymakers are essentially telling gas consumers, “We’re handing out life jackets, but we don’t have enough; we’re putting people in life boats, but we don’t have enough,” he said.

“I think it’s a very unreal situation,” Molinaro said, referring to the federal government’s projection that domestic gas production will reach 22-25 Tcf. “We have not gotten over 19 Tcf since the 1970s.” He said he didn’t see any policies in place that would cause that projection for U.S. gas production to be realized.

“There’s more that can be done to diversify our fuel supply, move us away from natural gas as a source for power generation,” Molinaro said. “And we absolutely have to increase domestic supply of American natural gas. Absent that, we will continue to see the de-industrialization of this country.”

Molinaro said the next big news has to be an explanation of “how on earth [can] they fulfill these projections for new LNG and for new domestic production” when there is nothing but constraints on supply. He talked about the opposition to new liquefied natural gas (LNG) import terminals, the limits of available global liquefaction capacity and the loss of LNG to foreign countries that post higher bids. Molinaro said 12 LNG terminals may be needed in the U.S., but he is hard-pressed to see how they will be built.

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