Minerals Management Service (MMS) Director R.M. “Johnnie” Burton believes that the deep shelf area in the Gulf of Mexico could be a near term solution to the gas supply problem that will sting Americans with high prices this winter.

According to the MMS, the shelf may hold as much as half of the nation’s supply of undiscovered natural gas that is considered technologically recoverable. The outer continental shelf is a 1.76 billion acre area that begins three to 12 miles off the U.S. Coast. Agency data show that natural gas exists below current shallow-water drilling platforms in the Gulf, some at depths more than three miles.

“This important frontier can be accessed from existing infrastructure, and that means it can be brought to market more quickly,” Burton told a conference in Houston.

“Because natural gas is a clean burning fuel source, demand for it has sharply increased over the last decade — about 90% of the new energy plants that come online in the next decade will be powered by natural gas; and about half of all American homes are heated with natural gas — around 56 million homes.

“This is a simple supply and demand issue, creating volatile price fluctuations,” Burton noted. The gap between supply and demand could increase by another 50% in the next 20 years, according to Department of Energy projections.

The increase in demand surged at a time when domestic natural gas production in the shallow waters of the Gulf of Mexico began dramatically declining. During the 1990s, natural gas production in the area declined by 23%. Increased deepwater natural gas development compensated for the loss, but new MMS data indicate deepwater production is projected to level off over the next few years, creating a greater need for new natural gas sources.

“With our available domestic resource base in decline and our major source of imports (Canada} facing its own production limits, we are forced to find alternative reserves to meet increasing demand by American consumers,” Burton said, indicating the deep shelf may be the answer.

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