Natural gas prices down 37%
Published 11:59 pm Thursday, October 8, 2009
Natural gas prices are 37 percent lower than they were a year ago for Southeast Alabama Gas District customers, who should also expect lower energy costs through the winter, company officials said Thursday.
CEO Greg Henderson and marketing director Shannon Gooden spoke at Thursday’s Andalusia Area Chamber of Commerce’s breakfast, which SEAGD sponsored.
Henderson said while prices will go up during the winter months, they would be lower than last year.
“Natural gas prices on the wholesale side have gone down,” he said, “And our gas wells are helping us keep the prices lower.”
In 2002, SEAGD formed a partnership with 11 other municipal entities and purchased 750 natural gas wells in Tuscaloosa County.
There also is a larger supply of natural gas than in recent years, he explained. When gas prices spiked, suppliers began drilling shale. When natural gas costs were lower, the cost of drilling shale was prohibitive, he said.
“Now we have a lot more supply,” he said, adding that about 100 years’ supply has been identified in the United States in recent years.
A very mild hurricane season also has contributed to the steady supply, he said, because offshore drilling has not been interrupted by a storm this year.
Because prices fluctuate, Henderson explained, SEAGD buys about half of what it will need in advance, and half of its supply on the open market.
SEAGD also is observing customer appreciation week this week. The company, formed by 14 member municipalities including Andalusia in 1952, is headquartered in Andalusia and has 178 employees here. Other member municipalities include Abbeville, Brundidge, Dothan, Elba, Enterprise, Eufaula, Fort Deposit, Greenville, Headland, Luverne, Opp, Ozark and Troy. SEAGD also serves the towns of Ashford, Brantley, Coosada, Cottonwood, Daleville, Gantt, Glenwood, Midland City, Napier Field, New Brockton, Newton, Newville, Opelika, Pike Road, Pinkard, Red Level, River Falls and Rutledge.