Giving Back to the Community

The Natural Gas industry is full of companies that are not only producing better gas and power for their communities, but are also giving back to the communities they are in.

Columbia Gas of Virginia

Columbia Gas of Virginia believes that the vitality of their business depends on the health and well-being of the communities where they live and work. Last year alone they donated over $300,000 to a variety of non-profit organization in their communities. They look for opportunities to provide funding and volunteer support in the areas of human needs, public safety, community development, environmental and energy sustainability, and leadership and science education.

Recently they have contributed to “RACE – Are We So Different?” with a grant of over $10,000 to the Science Museum of Virginia to partly cover the field trip expenses for over 300 schoolchildren. They also recently contributed to Science Matter, Big brother and Sister of Harrisonburg-Rockingham County, HeatShare Fuel Fun, and many more.

Virginia Natural Gas

Virginia Natural Gas aims to make the most meaningful impact they can in their communities. They try to focus on the areas of Energy Assistance, Education, Environmental Stewardship, and Community Enrichment within their communities.

One of the big events that they support is the Special Olympics Annual Polar Plunge.  Virginia Natural Gas led the corporate fundraisers list by raising donations from more than 300 supporters. Also their employees took part in the festivities for the 13^th year in a row by volunteering behind the scenes and taking the plunge themselves.

Along with the Annual Polar Plunge, Virginia Natural Gas has been helping their local Salvation Army.  They contributed a matching gift of $108,000 to the Salvations Army’s EnergyShare program. The donations help areas with low-income residents pay for their winter heating bills.

Briggy Bandz

Briggy Bandz is not a natural gas company, but they are a service company for the industry and they have been going above and beyond the call of business. The company produces Bandz that are used to cool the workers at the natural gas companies. The workers typically have to wear layers of proper protective equipment regardless of the temperature so they often face the threat of overheating. The company donates between $1 to 40% of each Bandz sold to many non-profit organizations. These organizations include Caleb Regenski Memorial Fund, Down Syndrome, Law Enforcement (Concerns of Police Survivors), Autism, and many more.

The Natural Gas Industry continues to strive to make the world a better place one community at a time.

Natural Gas Pipelines and Baker Hughes

The natural gas industry uses natural gas pipelines to transport natural gas around the country. In the US alone there is a highly integrated transmission and distribution grid that can transport natural gas to and from nearly any location in the lower 48 states.

For natural gas to be able to be transported to almost any location in the lower 48 states there are 305,000 miles of interstate and intrastate pipelines that are needed. There are over 210 different natural gas pipeline systems that make up these 305,000 miles. 400 underground natural gas storage facilities store the natural gas, while there are more than 11,00 delivery points, 5,000 receipt points, 1,400 interconnection points, and 24 hubs or market centers that provide a way to get the natural gas to the consumers.

Pipelines are the best way to transport natural gas in this day and age, but there are several problems that these pipelines and pipeline companies can cause. To start with, under a federal law known as the natural gas act, companies have the right to exercise eminent domain so it can condemn private property for constructing and maintaining the pipeline. If the company chooses your private land as some of the land it wants to use all you can do is live with it or move away.

This doesn’t sound like a big problem to most people, but serious problems with the pipelines are that there is a constant risk of accidents, spills, and explosions. In the past few years, there have been many large pipeline failures that led to massive damage and even loss of live.

In September 2010, a natural gas pipeline explosion of San Bruno, California killed eight people. Once the National Transportation Safety Board had time to investigate the case they found “troubling revelations… about a company that exploited weakness in a lax system of oversight and government agencies that placed a blind trust in operators to the detriment of public safety.”

Luckily companies like Baker Hughes have created the GEOPIG high-resolution caliper in-line inspection service. These PIGs are intelligent robotic devices that are propelled down the pipelines to evaluate the interior of the pipeline. These PIGs can test pipe thickness, pipe roundness, check for signs of corrosion, detect minute leaks, and any other defects along the interior of the pipeline.

Although it is great that companies like Baker Hughes have created these PIGS that are making pipelines much safer, they have not solved all of the problems for the natural gas pipelines. It will be interesting to see how increase use of natural gas will affect these pipelines and the safety hazards that go along with them.

Natural Gas Pipelines by Region:

New Investment Opportunities In the Natural Gas Industry

Now that the U.S. economy has started to recover from its recent recession, many Americans are asking the same question: where is the safest and smartest place to invest their money? The natural gas boom currently in action is one of the most important trends affecting the American economy and it would be the smartest choice to invest in this new era of sustainable energy.

According to Forbes’ “Energy Forecast 2013-2014,” the outlook for energy in the next two years is surprisingly diverse. Oil and gas prices are expected to remain high while natural gas prices continue to fall increasing the gap between the two fuels to unprecedented levels.

Oil and gas prices are unreliable and unpredictable because it changes on a daily basis which makes it an unstable investment. For example, on February 11, 2013 it was reported that gas prices rose every day for 25 days straight, reaching a national average of $3.59 per gallon, the most expensive national average recorded on February 11. Within these two weeks, gas prices increased by 25 cents which was the biggest jump in prices in over a year. Even though gas prices constantly change future expectations remain high for its price level.

Oil prices are expected to remain high because of the limited supply and increase in demand. There is a limited supply of gas and its liquid derivatives in the world and this is why oil prices are constantly increasing. On the other hand, natural gas will continue to be cheap in the North American market because supply is greater than our demand. Although new drilling is declining, a well that has been drilled will continue to be productive long after prices have fallen. Operating costs are tiny in most cases, so natural gas will continue to move into the world market.

Here are some companies to keep an eye on for future investments.

Natural gas is replacing dirtier and more expensive sources of fuel like coal at a rapid peace, and this increases demand for transportation, storage and all kind of related services. That is why, Enterprise Products Partners (NYSE: EPD), a company that transports and processes natural gas, natural gas liquids, crude oil, refined products and petrochemicals, will have such a profitable future because the demand for transportation of natural gas is on the rise and will continue to be in high demand as the demand for natural gas increases.

The company is in the process of developing a new 270-mile pipeline header system that will deliver ethane to petrochemical plants in the Gulf Coast region, and it’s in the position of accumulating all of the benefits from the increase in demand of LNG. Being a natural monopoly, competition is not a big problem and, in addition to all this, investors in this master limited partnership are getting a 4.4% dividend yield.

Companies like Westport Innovations (NASDAQ: WPRT) and Clean Energy Fuels (NASDAQ: CLNE) have many things in common, to begin with: both companies are betting on LNG as a cheaper and more efficient fuel for vehicles. Westport is in the business of building engine conversion technologies, and it has partnerships with giant like Caterpillar and Cummins. Westport has been increasing sales rapidly over the last years, and gross margins are on the rise too.

Here is the bottom line, the natural gas industry has only just begun its first stages and will provide many opportunities for its investors over the next few years. If you are willing to take the risks and commit to long term investments, disruptive plays like Westport and Clean Energy Fuels can potentially deliver amazing returns if LNG continues to gain traction as the fuel of our future.

Drive a lot? Switch to natural gas

Waste Management recently switched their garbage trucks to Compressed Natural Gas. Two months ago, the first natural gas powered food truck was introduced in New York by Mayor Bloomberg. And taxi cab drivers in Afghanistan are converting their cars to compressed natural gas in increasing numbers specifically because it is much cheaper than gasoline. Companies are switching their fleets to natural gas, still at a small, but ever-increasing rate. So should you be converting your vehicle to natural gas too?

Well, the downsides can’t be overlooked. To start, to convert a vehicle to natural gas requires you to give up most, if not all, of your trunk space because of the large natural gas containment tank required. Also, there are relatively few compressed natural gas fueling stations available. Prices of natural gas a volatile and fluctuate based on the season.

Now, the bright side. The relatively cheap price of natural gas is what’s driving many companies to switch to its use in company vehicles.

Average price per gallon:

• Regular Gas: $3.57
• Diesel: $3.98
• Compressed Natural Gas (Gallon Equivalent): $2.11

Natural gas is the cleanest burning hydrocarbon which means it’s better for environment and for our health. The EPA is currently planning to introduce new rules that would reduce the amount of sulfur in gasoline from 30 parts per million to 10 ppm which would increase the cost of gasoline production by roughly 10 cents per gallon, the Wall Street Journal reports. This plan comes in an effort to reduce smog and is backed by the Obama administration. According to the American Lung Association, the use of lower-sulfur gasoline in cars currently on the road would be the equivalent of taking 33 million cars off the road in terms of its effect on pollution.

Is using natural gas really better for the environment than using oil? That’s hard to say because while natural gas burns cleaner, the extraction method of fracking, which has made natural gas so cheap is a controversial method which pollutes surrounding bodies of water.

There is a calculator offered on www.cngnow.com that allows you to plug in how far you drive yearly and then calculates for you the fuel savings and break even point of converting your vehicle to CNG. The average American drives about 13500 miles per year, in a passenger vehicle that gets 22.5 MPG. That American wouldn’t get her investment for a basic conversion system back until after 7 years after installation

My findings are as follows: If you drive long distances weekly, don’t use all the space in your trunk, can afford a small upfront investment and want tremendous fuel cost savings then it’s time to convert to natural gas. Otherwise, you may want to wait a few more years until prices for conversion kits drop, oil prices rise, natural gas prices decrease even more, or you start having to commute longer distances

Wastewater and Casella Waste Systems

Natural Gas companies use Hydraulic fracturing or fracking to increase the rate that natural gas can be recovered from the natural reservoirs. These reservoirs are typically porous sandstone, limestone or dolomite rocks and are found deep below the earth’s surface. Fracking provides a path connecting a large volume of the reservoir to the well at a faster rate. To make this path they pump fracturing fluid into the well bore at a rate that will increase pressure down hole to exceed that of the fracture gradient of the rock.

The fracturing fluid is made up mostly of water, but most fracturing fluid contains a very low concentration of between 3 and 12 additive chemicals depending on the characteristics of the water. Between 20% to 40% of the water used for this fracking returns to the surface as wastewater, also known as produced water. Wastewater includes the chemicals from the fracturing fluid as well as contaminants that it picks up from deep within the earth such as heavy metals, volatile organic compounds, salty brine, and radioactive materials.

Potentially this wastewater could be treated at treatment facilities if the plant is properly equipped to remove these chemicals and radioactivity. The problem is that there are very few plants that have the technology to do this.

One company, Casella Waste Systems, is helping build plants that have the technology to break down and remove these chemicals and radioactivity.

Casella Waste Systems’ mission statement is “Every day we help create better people, businesses and communities by helping them to protect and enhance our environment and natural resources” and that is exactly what them have been doing.

A lot of the wastewater is sent to landfill plants where they remain wastewater, but not at Casella Waste Systems. Casella knows that landfills are not going to disappear, but they are changing the way they see landfills. They see landfills shifting from resource consumption to resource sustainability. Their landfills have a gas collection system that is not merely designed to passively capture gas, but they also are designed to extract gas to power gas-to-energy plants producing clean electricity and to mitigate greenhouse gas emissions. They also call these landfill sites environmental campuses because resources are extracted from all aspects of the waste stream.

Casella Waste Systems is finding creative solutions to the natural gas industry’s problems, and are hopefully getting other companies to change the way they think about landfills and wastewater.