Ukraine Conflict Opens Natural Gas Discussion - KFYRTV.COM - Bismarck, ND - News, Weather, Sports

Ukraine Conflict Opens Natural Gas Discussion

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The combination of horizontal drilling and hydraulic fracking has allowed companies to tap into natural gas in shale formations across the county including North Dakota. And with the conflict between Ukraine and Russia, it has opened the discussion of exporting natural gas to European markets.

While the idea of exporting natural gas sounds good on paper, there are major hurdles in getting the gas to market. The U.S. government is facing pressure to ramp up the exports to reduce the stronghold Russia holds on the European market.

The U.S. exports small amounts of natural gas through pipelines to Mexico and Canada and some through ships. But, most of the gas produced in North Dakota stays in the region due to the sets of pipelines.

"The way the natural gas system is set up so the gas would stay in that mid continent region. Any changes in the whole U.S. supply and demand dynamics would have an impact on North Dakota, but as far as North Dakota natural gas making it to one of those facilities at this point, no it wouldn't be an option," says the director of the North Dakota Pipeline Authority Justin Kringstad.

Aside from a lack in infrastructure, natural gas exports must be approved through several government agencies including the Obama administration. That would give companies an opportunity to sell, but investors say they might not be interested in the endeavor.

"In order to compete with Russia, we would have to convince natural gas producers to over produce. Which would drive down the price that they make now. It is profitable, and it would be an expensive infrastructure to get natural gas to the East coast so that it can be shipped in liquid form on ships," says the president of Heartland Investor Services Eugene Graner.

The amount of infrastructure, money, time and administrative approval make the idea of transporting natural gas one for the future rather than tomorrow.

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