Liquefied Natural Gas (LNG) is increasing market share because of increased use of natural gas at electric utility plants. Today, LNG makes up about 2 percent of all gas consumed in this country but if the projects now under consideration become real, then LNG imports could supply 15 percent of the nation's gas demand by 2025, says the U.S. Energy Information Administration.

Natural gas resources are plentiful all over the world. In addition to the U.S., there are huge reserves in Indonesia, the Persian Gulf states of Qatar and Oman, as well as in Russia and several West African countries.   In ascending order, the countries controlling the largest reserves of natural gas are the United Arab Emirates, Qatar, Saudi Arabia, Iran and Russia, which is trying to cartelize the market. For both environmental and national-security needs, nuclear power represents a win-win option.  The first LNG plant built in the U.S. was built in Alaska in 1969 and is still operating.

In its vaporized state, natural gas is voluminous and therefore the rate of energy transferred moves rather slowly through high-pressurized pipelines, especially when compared to oil. To get LNG, natural gas is cooled to a temperature of minus 260 degrees Fahrenheit until it becomes liquid and occupies 1/600 of its gaseous volume. Large tankers are then used to ship the LNG to major markets. A typical liquefying plant costs about $1 billion, tankers are priced at $250 million a piece and a terminal to store the LNG and to "regasify" runs between $300 million and $500 million.

Right now, only four LNG receiving terminals exist in the United States and are located in 1) Georgia, 2) Louisiana, 3) Maryland and 4) Massachusetts.  One of the largest facilities, owned by Dominion Resources, is located about 40 miles from Washington, DC - - Cove Point terminal on the Chesapeake Bay in southern Maryland. Dominion Resources, the Richmond-based energy conglomerate, is Virginia's largest electric power supplier and one of the country's largest natural gas producers. The Cove Point plant can deliver 1 billion cubic feet of flowing gas a day -- about 2 percent of U.S. demand and as much as 10 percent of the gas volumes utilities store in the summer ahead of the winter heating season. Tankers deliver the frozen LNG from the dock through two 31-inch diameter pipes to storage domes a mile from shore. 

Dominion bought the plant for $217 million in 2002 from the Tulsa, Oklahoma-based Williams Cos. and is spending another $180 million on renovation and expansion. Gas companies are charging customers about an extra 75 cents per therm -- roughly 100 cubic feet of gas -- to purchase and transport LNG. Three major oil companies purchased exclusive rights to use the loading dock from Dominion – 1) BP, 2) Royal Dutch/Shell and 3) Statoil, the Norwegian oil company. BP is expanding its LNG plant in Trinidad to bring gas to Cove Point. Royal Dutch/Shell is developing an LNG plant in Nigeria, and Statoil will produce LNG from Norway's gas fields.

A single tanker carries enough LNG to supply the daily energy needs of more than 10 million homes. LNG, chilled to minus 260 degrees Fahrenheit, expands 600 times when warmed to its normal vapor state.  LNG is contained in white storage domes -- giant round thermos containers for the chilled liquid gas.

The increase in gas prices has opened the door to LNG.  Gas inventories needed for the winter are still way below normal. The gas has to come from somewhere other than the terrestrial Lower 48 because domestic supplies cannot keep up with demand.  San Diego's Sempra Energy is building a $700 million LNG terminal in Louisiana and has applied for permission to build a terminal in northern Baja California, Mexico.  ChevronTexaco's is planning an LNG facility in the Gulf of Mexico, 36 miles from shore, which will import 1.5 billion cubic feet per day of natural gas by 2007. ChevronTexaco’s proposed Pelican LNG terminal in the Gulf would be the delivery destination for a huge gas production and LNG processing plant planned for Angola.

Sempra, parent of Southern California Gas and San Diego Gas & electric, also faces a need for natural gas to supply three power plants being built in Bakersfield, Phoenix and Mexicali, Mexico.

ExxonMobil Corp, the world's largest energy company, is building  a $12 billion LNG system in Qatar.  IT will deliver 2 billion cubic feel a day of natural gas to the U.S. starting in 2008. This unprecedented project will supply 2% of total U.S. natural gas.  Huge special tankers will be developed to transport the fuel to ports in the Texas-Louisiana Gulf Coast region.  Chicago Bridge & Iron Company is the world's largest builder of the cryogenic tanks that hold LNG in its liquid state. Fluor Corporation of Aliso Viejo, and the House based Brown & Root division of Halliburton, Inc build liquefaction and regasification facilities.