Wednesday, January 27, 2010

Exxon and the Big Picture

There is an interesting article on the New York Times website about how the Exxon/XTO transaction will cause Congress to look more carefully at natural gas.  Not to beat the dead horse, but Exxon has suddenly inserted itself into the conversation on hot button issues like climate change and hydraulic fracturing.  The company, though often vilified, brings tremendous political and operational clout and should elevate the cause of natural gas, especially in Washington D.C. 

The article offers a big picture view of Exxon in relation to the above topics and hints that just because Exxon is on board it won't be a smooth ride for natural gas.  Exhibit A:  at the Congressional hearing last week to discuss the Exxon/XTO deal, Exxon CEO Rex Tillerson stated that using natural gas in power generation is a better and more efficient use of gas than converting vehicles to CNG.  Exxon has a high degree of interest in natural gas, but it doesn't want to cannibalize its #1 product, gasoline.  Suddenly, the new best friend of gas fans is at odds with old standby T. Boone Pickens, who is advocating the use of natural gas for transportation.  Nothing comes easily.

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