Natural gas prices bottom out, but will remain high

By CMTA Staff

Capitol Update, Feb. 3, 2006 Share this on FacebookTweet thisEmail this to a friend

The good news is that natural gas prices appear to have bottomed out.  The bad news is that the new "base" or "floor" for gas prices is $8.50 per MMBtu (one million British thermal units), according to many industry observers.

A relatively warm winter has caused prices to reach a plateau, for now, but the overall picture is anything but rosy.  Prices have more than doubled since 2001.
California's demand for natural gas is expected to grow significantly within the next decade, outstripping supply.  The projected shortages will further increase natural gas and electricity prices (40 percent of our state’s electricity generating capacity is fueled by natural gas), threatening the California economy and harming consumers.

California only produces 16 percent of the natural gas it consumes. To help meet demand, liquefied natural gas (LNG) can play a larger role in the state's energy supply mix.

Since last February, CMTA has been leading a coalition of businesses and consumer groups, Californians for Clean Affordable Safe Energy (Cal-CASE), to encourage California to increase the supply of natural gas through the siting of LNG terminals.  

On February 1, Cal-CASE held a news conference at Sheffield Platers, Inc., where Sheffield president Dale L. Watkins and representatives of Cal-CASE, the Industrial Environmental Association and the San Diego Regional Chamber of Commerce discussed the impact of rising natural gas prices and LNG as a means to meet the growing demand of natural gas in California.  

    To see the February 1 Press Release, click here.

Due to supply shortages, your company and employees are seeing record high natural gas bills this winter.  If you have not already done so, please join Cal-CASE and help California adopt policies to support more natural gas supplies.  

    To join Cal-CASE or for more information click here.
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