Recent stories in the The New York Times quoting insiders and regulators who are skeptical about the economics of natural gas have prompted rebukes this week from the industry. The Times reports cite industry supporters, but also include anonymous e-mails suggesting some companies were overstating—perhaps deliberately—the amount of gas they could affordably get out of the ground.
Louisiana Oil & Gas Association President Don Briggs concedes that shale gas wells are becoming less profitable and taking longer to pay out, but says this is a result of supply increases that the successful wells have produced. Briggs says the Haynesville Shale formation has injected more than $22 billion into Louisiana’s economy in fiscal years 2008 and 2009 alone, helping shield the state from the national recession.
Ken Cohen, ExxonMobil’s vice president of public and government affairs, accuses the Times of “campaigning against cleaner-burning, domestically produced natural gas.” Chesapeake Energy CEO Aubrey McClendon, in a lengthy e-mail to his employees posted on the company’s Facebook page, suggests the Times is being “manipulated” by environmentalists and lending too much credence to a “relatively small group of analysts and geologists who have doubted the future of shale gas.”
Also this week, some federal lawmakers are calling for investigations into whether the industry is misleading investors. Two of the Times stories can be read here and here. A statement made by Briggs in response to the second article can be read here.
