[SOUND] On this chart, you'll also notice that some of the numbers are bold. We've got numbers both for production and consumption. And I've turned the ones into a bold type to indicate the cases where that balance between production and consumption are out of whack. You see, transporting natural gas in a ship is not anywhere near as easy as transporting crude oil or refinery products. The density between a liquid and a gas is about a factor of 10,000 to 1. If I just took a big tanker and filled up the holes with natural gas, and I didn't pressurize the natural gas at all, I would need 10,000 tankers to take what one tanker could bring in oil. Of course, that would be silly. I can pressurize it, right? I can have compressed natural gas. And that certainly gets me up a factor, maybe even of 40 or 50, not of 10,000. You could liquify the natural gas, that takes money. You have to turn it down to cryogenic temperatures, and keep it at that temperature as you transport it. So transporting natural gas across oceans is possible, but not very cost effective. The best way to transport natural gas is in a pipeline. And that means you have to have a pipeline between the consumer and the producer. There are two countries that border the United States, Canada and Mexico. And indeed, we can have pipelines going between the two sources. We used to import oil from Mexico, but Mexico has grown and now is actually past the point of self-sufficient. I think they're even importing oil, and possibly even some gas at this point. But Canada, which you can see is on this list, produces more natural gas than it consumes. And the difference between its production and consumption is probably really close to the difference between consumption and production in the United States. Note that the US is the largest consumer of natural gas, and the largest producer. Let's look at some of the other numbers involved. You can see Russia. Russia produces 50% more gas than they use. And natural gas is their primary energy source in the Soviet Union and now in Russia. That natural gas goes to Europe. We look here on the bottom of the list of a few countries, like Germany or Italy or the United Kingdom. They have to import gas. Certainly, for the Central European nations like Germany and Italy, that natural gas comes from Russia, because they can build a pipeline. Notice here, these are countries that are also all net producers. Indonesia can help fuel Japan. The Netherlands can help fuel the UK. Netherlands and Norway are on this list because of the North Sea. Now, let's look at this chart. This is the chart of natural gas flow in the United States. And the first thing to do is to look at the far left. And you'll see that we get gas from gas wells. We get some gas from oil wells. And we even get some gas from coalbed seams. Methane, CH4, it's a very simple hydrocarbon. And it's not surprising that it's formed and found in all these places where we would find other hydrocarbons. But then you can see this new entry into natural gas production in the US, and that's from shale. That's the tight gas that you use hydraulic fracturing to get at today. And these statistics, which are in 2013, show that it's about one-third of all the natural gas produced is from hydraulic fracturing of shale. An enormous resource that ten years ago was not even there. You might say wow, did the US import that much more natural gas? No, we just didn't use that much more natural gas. Almost every new power plant, electric power plant that's been put on the grid over this last 15 years has been one that uses natural gas. And using natural gas is actually quite efficient, because it burns completely. The only pollution it makes is water vapor and CO2. And you might say, that's bad, it's still making CO2. That's a global warming gas. Well, that's true, it is a global warming gas. But per energy unit, I produce less CO2 by burning methane than I do by burning oil or coal. Oil has a ratio of carbon to hydrogen of about two hydrogens for every carbon. Methane has four hydrogens for every carbon. And coal is about a one-to-one mix of hydrogen and carbon. If I have a lot more carbon-carbon bonds, I need to make a lot more CO2. As opposed to hydrogen-carbon bonds, where that hydrogen can turn into water vapor. So that's the production flow. Now, there's some other interesting numbers on here. You'll see this number, three something quads, going into repressuring. Basically, this is the energy content that's used to get all of that gas to where it has to go, sort of the energy cost. Because it's a little different than the gas number here on the chart that shows what goes into storage. It's telling you about these vast underground porous rock formations. Basically think of it as slightly porous gravel beds deep down underground. I told you that you probably don't get everything out that you put in. And indeed, if you compare the number put into storage compared to taken out of storage, right, you can see that there's a bit less. But that's the only way to buffer, to create enough capacity to be able to use this fuel in the winter. There are some imports and some exports. The border between the US and Canada is a long one. You can imagine that you would rather take a gas on the West, go back and forth to the US, and then the East back and forth to Canada. Than trying to say, it's Canadian gas, we gotta ship it all the way across the whole country, doesn't make any sense at all. In the end, the use of these fuels, clearly, electricity is one of the largest, using it in industry as a pollution-free fuel. You don't need to worry about pollution mitigation, sulfur removal, acid rain, and so forth when you burn natural gas. And we use it to heat buildings, commercial and residential use. [MUSIC]