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    Virginia Natural Gas

    Natural gas is a versatile fuel, which adapts to a wide range of uses. Residential, commercial, and industrial energy users located throughout Virginia and the nation rely on natural gas to meet a portion of their energy needs.

    Production
    Throughout the 1990s, Virginia's natural gas production grew rapidly, both in absolute terms and relative to the state's energy needs. In the southwestern Virginia counties where Virginia natural gas is produced , gas production and development activities are substantial contributors to the local economy.

    The predominant chemical component of natural gas is methane, CH4 . Two major types of natural gas are produced in Virginia. Both are considered "fossil fuels," the remains of living creatures that inhabited the earth millions of years ago. "Conventional" natural gas is extracted from geologic formations that give rise to petroleum deposits and formations with similar characteristics. These formations are generally several thousand feet below the earth's surface. Petroleum is often produced in association with conventional natural gas. In Virginia, petroleum byproducts are extracted from conventional gas production wells but only in small quantities.

    The other form of natural gas produced in Virginia, called "coalbed methane," occurs in association with coal deposits. Methane (CH4) is emitted by coal via an "outgassing" process. Methane can be a hazard in underground coal mines because it is easily ignited. "Coalbed methane" extraction produces marketable product by extracting gases from coal deposits that would otherwise be released into the mine or the atmosphere, if that coal were mined. To produce coalbed methane, a producing firm drills through the earth into an underground coal seam, in a manner similar to the drilling of a water well. When the coal seam is accessed, high-pressure gases are injected into the well down with the goal of fracturing the coal seam. Exposure of the fracture surfaces releases the methane gas, which is then withdrawn from the well.

    Both conventional gas and coalbed methane withdrawn from wells receive additional processing prior usage in homes and businesses. From the well, the extracted gas is fed into a system of piping, known as "gathering lines," which connect the wells to facilities that process the raw gas into a marketable commodity. During processing, excess moisture and corrosive gas contaminants (such as hydrogen sulfide, H2S, and ammonia, NH3) are removed and the resulting product is checked for energy content. Natural gas sold in commercial markets has a minimum energy content of 1000 Btus per cubic foot. If the natural gas being processed is found to contain energy well in excess of that minimum, that gas may be diluted so as to attain the commercial energy-content standard. The processing facility also monitors incoming and outflowing gas to assure that product with energy contents below the commercial standard is not entered into the distribution system.

    Virginia's natural gas production has increased dramatically in recent years, from less than 20 million cubic feet in 1970 to more than 85 million cubic feet in 2004. Most of this increase has occurred due to expansion of coalbed methane production in Buchanan and Dickenson counties, as conventional gas production has increased only modestly during the decade. Large portions of that coalbed methane was produced in association with operating coal mines, as extraction in advance of mining helps to maintain safe conditions in the mines by withdrawing the potentially explosive methane gases.

    Transportation

    The majority of Virginia's natural gas is supplied from a network of interstate pipelines that connect the nation's major gas producing areas, including Louisiana, Texas, and the Gulf of Mexico, to northeastern population centers such as New York, Boston, and Washington DC. Because Virginia is located along these pipeline routes, large quantities of gas move through the state .

    After processing, Virginia gas production is fed into the interstate pipeline network; some Virginia-produced gas is marketed through pipelines located in adjacent states, although the majority goes to in-state pipelines. Gas distribution utilities and industrial customers withdraw gas from that interstate pipeline network; the distribution utilities supply natural gas to homes and small businesses within their service areas .

    The late 1990s have seen a rapid expansion of demand for natural gas throughout the nation, and within Virginia. As a result, several new pipelines have been proposed for construction in Virginia. Proposed pipeline routes include an extension of a pipeline currently terminating in Radford to Roanoke and Franklin County; the Greenbrier pipeline project that would extend from North Caroline to West Virginia, passing through Virginia along a path extending from Henry to Giles and Bland Counties; and the Patriot Extension pipeline that would extend from Henry to Wythe County.

    Because space heating is a major use for natural gas, the bulk of gas consumption occurs during the winter months. Therefore, prices tend to be higher during the winter heating season than during other times of year. Purchasing gas during summer months for use in winter is a logical business strategy for firms that have access to large empty spaces that can be used for gas storage. Unfortunately, facilities and structures suitable for gas storage are not common. In Saltville, Smyth County, large underground caverns in the geologic salt deposits are being developed into Virginia's only major gas-storage facility.

    Consumption

    Because of its characteristics, natural gas is a versatile fuel. Unlike coal and petroleum, natural gas can be moved easily and at low cost to purchaser locations through pipelines. Combustion devices are generally tied directly to the pipeline transportation system, eliminating need for on-site storage at the point of consumption. Burner devices are simple and inexpensive to construct and operate. The consumer is not required to physically handle the fuel. Burning the fuel itself results in only minimal production of potential air contaminants, so pollution control equipment is generally not required. In addition, natural gas produces less carbon dioxide (CO2) per unit of energy released than either of the other two principal "fossil fuels," coal and petroleum.

    Because it is a versatile fuel, natural gas meets a wide range of energy uses. In Virginia, the industrial, commercial, and residential sectors are all major gas consumers , with each accounting for 20 percent or more of total gas usage. The primary residential and commercial uses are space heating, water heating, and cooking. Industrial uses include process heating and chemical feedstock.

    Electric utilities also consume natural gas as a fuel for electric generation. Gas consumption by electric utilities is rising rapidly, having more than tripled during the 1990s. Use of gas for electrical generation is expected to continue rising, as new gas generation facilities are proposed for construction in several Virginia locations.


    Virginia Natural Gas Flow Diagram, 2005
    (Million Cubic Feet)


    Notes:
  • Calculated Waste calculated by VCCER; Balancing Item calculated by EIA.

  • Source:
  • State Summaries Tables, Natural Gas Annual, 2005, EIA.


    National Data


    Summary Statistics for Natural Gas in the United States, 2001-2005
      2005 2004 2003 2002 2001
    Number of Gas and Gas Condensate Wells Producing at End of Year 425,303 406,147 393,327 387,772 373,304
    Production (million cubic feet)
    Gross Withdrawals
    From Gas Wells 17,500,289 17,885,247 17,881,802 17,794,858 18,129,408
    From Oil Wells 5,987,967 6,084,431 6,237,176 6,146,420 6,371,371
    Total 23,488,255 23,969,678 24,188,978 23,941,279 24,500,779
    Repressuring 3,707,330 3,701,656 3,547,781 3,455,145 3,370,832
    Vented and Flared 119,097 96,408 98,113 99,178 96,913
    Wet After Lease Separation 19,661,829 20,171,614 20,473,084 20,386,956 21,033,033
    Nonhydrocarbon Gases Removed 711,095 654,124 498,724 502,176 462,738
    Marketed Production 18,950,734 19,517,491 19,974,360 19,884,780 20,570,295
    Extraction Loss 876,497 926,600 875,816 956,992 953,984
    Total Dry Production 18,074,237 18,590,891 19,098,544 18,927,788 19,616,311
    Supply (million cubic feet)
    Dry Production 18,074,237 18,590,891 19,098,544 18,927,788 19,616,311
    Receipts at US Borders
    Imports 4,341,034 4,258,558 3,943,749 4,015,463 3,976,939
    Intransit Receipts 567,674 589,517 730,378 588,702 539,156
    Withdrawals from Storage
    Underground Storage 3,056,598 3,036,566 3,098,734 3,137,666 2,308,687
    LNG Storage 48,255 51,123 61,950 42,797 35,470
    Supplemental Gas Supplies 63,691 60,365 67,706 67,980 86,312
    Balancing Item 331,241 356,956 -38,495 -13,339 134,346
    Total Supply 26,482,730 26,943,976 26,962,566 26,767,059 26,697,222
    Disposition (million cubic feet)
    Consumption 22,241,202 22,388,975 22,276,502 23,007,014 22,238,624
    Deliveries at US Borders
    Exports 728,601 854,138 679,922 516,233 373,278
    Intransit Deliveries 459,145 498,904 648,265 530,463 574,871
    Additions to Storage
    Underground Storage 3,001,583 3,150,003 3,291,714 2,669,844 3,465,239
    LNG Storage 52,200 51,956 66,162 43,504 45,210
    Total Disposition 26,482,730 26,943,976 26,962,566 26,767,059 26,697,222
    Consumption (million cubic feet)
    Lease Fuel 756,324 731,563 758,380 730,579 747,411
    Pipeline and Distribution Use 584,779 566,187 591,492 666,920 624,964
    Plant Fuel 355,193 366,341 363,903 382,503 371,141
    Delivered to Consumers
    Residential 4,806,136 4,868,797 5,079,351 4,888,816 4,771,340
    Commercial 3,101,526 3,128,972 3,179,493 3,144,169 3,022,712
    Industrial 6,745,835 7,242,837 7,150,396 7,507,180 7,344,219
    Vehicle Fuel 22,265 20,514 18,271 14,950 14,536
    Electric Power 5,869,145 5,463,763 5,135,215 5,671,897 5,342,301
    Total Delivered to Consumers 20,544,907 20,724,883 20,562,727 21,227,012 20,495,108
    Total Consumption 22,241,202 22,388,975 22,276,502 23,007,014 22,238,624
    Delivered for the Account of Others (million cubic feet)
    Residential 417,644 435,536 472,315 423,754 361,903
    Commercial 1,103,690 1,124,212 1,109,648 1,144,456 1,026,557
    Industrial 5,139,422 5,528,981 5,568,750 5,802,752 5,813,726
    Number of Consumers
    Residential 63,573,466 62,469,134 61,871,450 61,107,254 60,286,364
    Commercial 5,196,428 5,139,949 5,152,177 5,064,384 4,996,446
    Industrial 205,217 209,058 205,514 205,915 217,026
    Average Annual Consumption per Consumer (thousand cubic feet)
    Commercial 597 609 617 621 605
    Industrial 32,872 34,645 34,793 36,458 33,840
    Average Prices for Natural Gas (dollars per thousand cubic feet)
    Wellhead (Marketed Production) 7.33 5.46 4.88 2.95 4.00
    Imports 8.12 5.81 5.17 3.14 4.43
    Exports 7.59 6.09 5.54 3.41 4.19
    Pipeline and Distribution Use -- -- -- -- 3.55
    City Gate 8.67 6.65 5.85 4.15 5.72
    Delivered to Consumers
    Residential 12.84 10.75 9.63 7.89 9.63
    Commercial 11.59 9.43 8.40 6.63 8.43
    Industrial 8.56 6.53 5.89 4.02 5.24
    Vehicle Fuel 9.09 7.16 6.19 5.10 6.60
    Electric Power 8.48 6.11 5.57 3.68 4.61


    Get the data in CSV format

    Notes:
  • "" = Not applicable.
  • The United States equals the 50 States and District of Columbia.
  • Marketed Production volumes are equal to (total gross withdrawals minus repressuring, vented/flared, nonhydrocarbon gases removed, and extraction loss).
  • Total Dry Production volumes are equal to (marketed production minus extraction loss).
  • Totals may not add due to independent rounding.


  • Source:
  • Table 1, Natural Gas Annual 2005, EIA.

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