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Investment Analysis Clubs / Macro Economic Trends and Risks


Subject:  Re: Nat gas glut explained Date:  12/31/2012  2:06 PM
Author:  pauleckler Number:  412435 of 539142

Fracing technology makes thousands of square miles look attractive for drilling. Drilling costs remain high.

When NG pricing weakens (due to excess supply), drilling investment slows--maybe to a stop. But as markets are found to monetize the gas, investors are willing to take the risk.

Some of those attractive areas ultimately may produce dry holes. Until the limits are known, new discoveries are likely as soon as the market will make them pay.
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