natural gas exploration companies

Why Britain is Looking to U.S. for 20 Years' Worth of LNG

pipes

With its domestic natural gas reserves nearly depleted, the U.K. is turning to a U.S. company to supply enough liquefied natural gas (LNG) to provide energy to nearly 2 million British homes for 20 years.

The $15.1 billion-plus deal between Houston-based Cheniere Energy Inc. (NYSE: LNG) and Centrica, a British energy firm, marks the first time Britain has ever imported natural gas from the U.S.

The deal has big implications for companies involved in the flourishing U.S. shale gas industry, in which gas is extracted through hydraulic fracturing, or fracking.

You see, fracking has led to an abundance of natural gas and will go a long way toward making the U.S. a net exporter of energy instead of a net importer in the coming years.

That, of course, will be a big boon to natural gas companies that export LNG.

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How Natural Gas Companies Could Save You 25% on Fuel

Thanks to new developments from natural gas companies, fuel costs might soon be falling by as much as 25% for some individuals.

Royal Dutch Shell PLC (NYSE: RDS:A, RDS.B) plans to spend $250 million on a liquefied natural gas (LNG) plant and filling stations in what is the biggest single investment yet in making frozen gas a transport fuel.



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Natural Gas Companies: A Contrarian Bet on Higher Prices

The decline in natural gas stocks has been anything but natural lately.

With ample stores and cheap prices, natural gas-related equities have taken a beating and continue to be battered.

While it is always difficult to call a bottom, the tide may be turning for natural gas companies despite the latest data.

The price of natural gas fell again last week after the government reported an unexpectedly large increase in supply. To date, natural gas prices have slumped to levels not seen in 10 years.

Recent Energy Information Administration (EIA) reports reveal that the energy industry continues to deliver gas at a faster rate than Americans can consume it.

U.S. supplies grew by 42 billion cubic feet in the week ended March 30, pushing the country's total supply to 2.5 trillion cubic feet. According to Platts, a premier source for energy prices, industry analysts had expected supplies to grow between 33 billion to 37 billion cubic feet.

With natural gas stores bursting at the seams, some of the nation's largest producers have announced plans to scale back production.

Jen Snyder, head of North American gas for research firm Wood Mackenzie told the Washington Post, "There hasn't been enough demand to use all the supply being pushed into the market."

Where prices go from here depends a great deal on the weather.



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