Tube Man Unconventional gas not down for the count yet

Dec 14, 2008 | 07:00 PM |

It's no secret that a severe economic slowdown has gripped the United States and much of the rest of the world.

OK, so the financial world might have been turned upside down. But that doesn't change the fact that unconventional natural gas plays a hugely important role in the domestic energy sector.

The United States has varied sources of natural gas—conventional gas, both onshore and offshore—as well as unconventional resources. The major types of unconventional gas include tight gas, coal bed methane and shale gas. The production of all three has been rising since 1980, thanks to encouragement from Article 29 of the Internal Revenue Code (Alternative Fuel Production Credit).

I think of natural gas as more of a "produce what you need" kind of resource—until the supply runs low. That's a big contrast to oil, with its typical peak-and-valley production patterns. This is part of the reason natural gas production has been steady for many years. Even while conventional production has been declining, unconventional gas production has risen to bridge the gap.....