The future of natural gas - an interview with Raymond Learsy

Oilprice.com: Well, why do you feel that's the case? I guess we could look at the New York Times as some kind of the benchmark for U.S. journalism. What is the motive? Or is it lazy journalism? Or something else? Why do you feel the media, the New York Times specifically, is offering a mischaracterization of the energy markets?

Raymond Learsy: Let me show you this. It is from a study that MIT made shortly after the New York Times articles and I don't think it was specifically meant as a rebut to the New York Times , but it goes into a great deal of detail that natural gas will result in demand reduction and displacement of coal-fired power by a gas-fired generation. And because of its more limited CO2 emissions further de-carbonization of the energy sector will be required and natural gas provides a cost effective bridge to such a low carbon future. In other words, natural gas, the way it's structured, it's enormous availability (we are finding more and more of it since these articles have been written), and it's extraordinary low cost, present a very real danger to other forms of hydrocarbons. And I don't know quite what the New York Times ' love affair is with the oil industry, but their articles were something that placed the whole idea of natural gas as a substitute, not simply for coal, but eventually for transportation fuel replacing gasoline, into jeopardy.

It just bedazzles me because you have at the current price of natural gas, which is about two and a half dollars an MMBtu, right? We have crude oil selling today at $95 a barrel. A week ago it was $100 a barrel.

Oilprice.com: Yes.

Raymond Learsy: At $2.50 an MMBtu, the amount of energy that is delivered by that quotient of natural gas, the price of oil would have to be around fifteen dollars a barrel.

Oilprice.com: Okay.

Raymond Learsy: And so if we were able to convert our transportation fleet for the use of natural gas, which we have in plentiful supply in this country, we would no longer have to import crude oil, etc., and we would be in a position to displace gasoline. Instead the New York Times undermines and places into question the one solution and salvation that we have for true energy independence.

Oilprice.com: Okay. So, what about other renewable forms? I've had some

discussions with some folks at Rand recently about converting from a highly carbon intensive economy to a low carbon economy and the conversation always winds up on things like infrastructure, on things like converting everything from petroleum to natural gas to wind. Where does that conversation factor into this conversation?

Raymond Learsy: Well, I mean, you have other alternatives. You have nuclear energy, but on the other hand you do have a situation where we have not built a nuclear facility since the 1970s and China is going to be building 25 nuclear facilities in the next 15 years. Now, the question needs to be asked seriously and analyzed seriously, who is going to be better off at the end of 15 years? We, without having built any, or the Chinese with having built 25?

Oilprice.com: Right.

Raymond Learsy: And can we build them safely? And can we solve the problems of waste disposal? Now the Russians have done that. The Russians are very extensive in their nuclear facilities and they moved all of their waste disposal up into the edge of the Arctic somewhere in one of the peninsulas bordering on the Arctic Sea. And it's not only that, they've taken in waste disposal not only from their own plants but from other European plants such as France. Look at France, 80% of its electrical energy is generated, by nuclear power.