1. Natural Gas The Carbon Light Energy Source Abundant, Clean, Domestic Reduces air pollution, carbon emissions and our reliance on foreign oil Abundant, Clean, Domestic Reduces air pollution, carbon emissions and our reliance on foreign oil

2. 2 What to Look For What are policy aspirations? What is Natural Gas? How important is it as an energy source today? How much do we have? Can we increase production appreciably? Is it a clean energy source? Plans to achieve aspirations? Summary

3. 3 What is the Green Energy Goal? Obama Administration Goal “25% of Electricity from Renewables by 2025” and A 14% reduction of GHG by 2020 Waxman-Markey Revised Goal “20% of Electricity from Renewables by 2025”, (also provides a 5% allowance for efficiency improvement) and A 17% reduction of GHG by 2020” What if we accomplished these Goals Today using Clean Burning Natural Gas? Note: Waxman-Markey passed the House, waiting on Senate approval

4. 4 What is Natural Gas? Technically 96-98% ……. CH4 (Methane) It is NOT … Gasoline, Natural Gasoline, LPG, Propane, Butane, etc. 1 Carbon atom with 4 Hydrogen atoms around it  In Carbon based fuels it has the highest ratio of Hydrogen to Carbon  Highest energy content per carbon It is a gas at room temperature and a liquid at -258 degF It IS ……… Natural Gas, LNG, CNG

5. 5 2008 US Energy Supply 107 Quads Total

6. 6 How Much Natural Gas Do We Have? “Attainable potential is about 287 TCF of Natural Gas … … More than a hundred of our geologists and geophysicists contributed to this comprehensive study” JD Langston, VP Explor, Exxon Co, 1976 “Natural gas has had it” John O’Leary, Federal Energy Administration, 1977 Cumulative Production since 1977 is 582 TCF Proven Remaining Reserves exceed 238 TCF All Sources Potential Reserves now exceed 2,000 TCF

7. 7 U.S. Gas Reserve Growth Gas Inventory in Years NGPA Regulation First Barnett Large Water Fracs Wellhead De-Control Act Total Potential Reserves Years of Production

8. 8 San Juan Uinta Piceance Green River Cody Bakken Mowry Hillard- Baxter- Mancos Mancos Hermosa Lewis Pierre Barnett- Woodford Barnett Woodford Haynesville Fayetteville Excello- Mulky Marcellus New Albany Antrim Utica Niobrara Floyd U.S. Tight Gas and Shale Gas Plays

9. 9 U.S. Gas Production Growth Production Additions CBM & Tight Gas GOM Declines New Shale Plays

10. 10 US Natural Gas Production Growth For every 100 incremental Natural Gas Rigs Actively Drilling on a Continuous Basis: We can expect Gas Production to increase approximately 1 TCF per Year and We will also add over 100,000 New Jobs! Source: CERI Annual Report 2007-1

11. Is Natural Gas Clean? Cleanest-burning hydrocarbon fuel on the planet Combustion products are primarily CO2 and Water Vapor Drilling for natural gas leaves a small footprint At Least 95% Cleaner than Alternative Fuels for Toxics

12. 12 Where Does US Pollution Come From? CO (Carbon-Monoxide) ---------------------------------- Reduces Pulmonary Function, small children, sick and elderly NOx & VOC (NitrousOxide & Volatile Organics) --- Combine to form Ground Level Ozone which Reduces Pulmonary Function SO2 (Sulfur Dioxide) -------------------------------------- Acid Rain precursor and It smells like rotten eggs PM10 (~ 10 Micron Dust) -------------------------------- Stays in Your Lungs, Reduces Pulmonary Function and causes Haze 66% Utilities Oil and Gas Production 2.3% 73%58% Vehicles (On & Off Road) 38%

13. 13 Here’s a BIG Idea We can Achieve Stated US Goals for Clean and Domestically Sourced Energy for 25% of our Electricity generation NOW (Not in 2025!) simply by ……….. Shutting Down the 75 Worst Coal Fired Plants in the US Turning Up the EXISTING Natural Gas Combined Cycle Turbines Very Clean, Very Fuel Efficient, Under-Utilized And we don’t SPEND ANY $$Capital to Do It !

14. 14 Here’s Another BIG Idea We can use Natural Gas as Clean and Domestically Sourced Energy to Replace 25% of our Crude Oil Consumption by … Switching up to 33% of Vehicles to CNG (Compressed Natural Gas) Very Clean, Very Fuel Efficient, Very Economical

15. 15 What Do We Need to Do? How Much NatGas Production? Add Domestic Natural Gas Production of: 4.6 TCF/YR to provide electricity Add another 8 TCF/YR to Offset 25% of Crude Oil How Do We Accomplish That? Put the 1,000 “Layed Down” Gas Rigs back to Work Build or Re-Deploy 1200 New Gas Rigs Plus Create Up to 1.2 Million New Jobs ! Source: Industry Production Trend Analysis, CERI Annual Study 2007-1

16. Let’s Look at the Electric Power Sector

17. 17 2008 US Fuel Use for Electricity Production 40.7 Quads Total (25.8 Quads Waste Heat)

18. 18 How is Electricity Generated?

19. 19 Pollutants – Electric Sector

20. 20 Focus on the Worst Coal Plants There are 378 Large Coal fired Power Plants in the US 75 of the Worst Coal Plants in the US Emit : 55% of the SO2 32% of the Mercury 38% of the NOx 26% of the CO2 But provide only 14% of Total Electricity Majority were installed before 1970 – Old Technology Located in 22 States – primarily East of Mississippi “Locally” available Combined Cycle Natural Gas Turbine capacity to offset all 75 plants

21. 21 75 Worst Coal Power Plants 3% 4 plants 5% 3 plants 5% 3 plants 6% 5 plants 7% 6 plants 8% 6 plants 8% 8 plants 13% 9 plants 14% 8 plants 3% 3 plants 3% 3 plants 4% 2 plants 2% 3 plants 2% 4 plants 1% 1 plant 1% 1 plant 1% 1 plant 1% 1 plant 1% 1 plant 1% 1 plant 0.4% 1 plant 0.3% 1 plant Percent of Total Pollution Population < 1 million 1-5 million 5-10 million 10-15 million > 15 million

22. 22 A Plan to Replace 30% of Coal Alternative #1 – Utilize Existing Combined Cycle Gas Turbines Alternative #2 – Purchase Large Scale 2.4 MW Wind Turbines

23. 23 How Do the Alternatives Compare? FUEL / CAPITAL$ EMISSIONS

24. Let’s Look at the Crude Oil Photos provided by: MC Oil

25. 25 Oil Supply vs Consumption Total Sector Comprises ~ 40 QUADS per Year

26. 26 A Plan for NatGas to Displace Crude Oil What if we replace 25% of Crude Oil with Natural Gas? Over 54% of Total US Air Pollution results from Vehicles (On-Off Highway) The US Imports 65% of it’s Crude Oil (growing) 6 Million Bbls per day comes from OPEC countries 2008 Total Balance of Trade was -$816 Billion 2008 Value of Crude & Products was $447 Billion (55%)

27. 27 How Do We Do It? Need 8 Quads (~TCF) of incremental US supply Activate 800 NatGas Drilling Rigs (800,000 jobs) Convert up to 33% of vehicles to CNG (trucks too) Provide CNG filling stations to facilitate on highways This is a BIG Goal but Small Thinking Achieves Small Results

28. 28 CNG (Compressed Natural Gas) CNG Filling Station – safe, easy, similar to gasoline filling

29. 29 Expected Results Offset 38% of Imported Oil with Natural Gas Reduce the Trade Deficit by $130 Billion annually (-21%) Save US consumers $73 billion in fuel costs annually Create 800,000 new jobs Reduce total air pollution by nearly 30% Note: Cost savings based upon EIA 2008 average Imported Oil ($96.98/Bbl) and Citygate Gas ($7.47/MCF) prices Transportation Sector Reduce SO 2 emissions by 55% Reduce Mercury emissions by 32% Reduce GHG emissions by 15% This is Huge! Electric Power Sector

30. 30 Questions? Promote NatGas as the Realistic Green Energy And Write Your Congressmen