With all the controversy surrounding new offshore drilling projects, and with older fields producing less crude oil, major oil companies are increasingly betting their futures on natural gas, reports AP.

Their focus has moved to natural gas because it burns cleaner than oil and it is increasingly being used to fuel electricity and transportation.

Chevron recently made a $4.3 billion deal to buy up natural gas fields in the Northeast, while Exxon Mobil bought XTO Energy to become America’s largest producer of natural gas. Royal Dutch Shell expects natural gas to make up half its total global production in two years, AP reports.

With our oil reserves depleting, the move to natural gas is a natural progression. It will also allow oil companies to be less dependent on OPEC countries — since those nations control less than half the natural gas reserves.

“The Energy Information Administration expects worldwide natural gas production to increase 46 percent from 2007 to 2035, compared with a 30 percent increase in world production of crude and natural gas liquids,” AP reported.

While the United States doesn’t use natural gas as a primary source of fuel for its transportation needs (largely for city buses and garbage trucks), about three in five American homes use it for heat.

Natural gas is also used to generate 23 percent of electricity in the U.S, a number which is ever increasing.

Given the amount of new natural gas found in the country recently, experts say the U.S. is sitting on enough fuel to last the country for the next century.

USA Today reports, “While natural gas isn’t renewable like ethanol, there’s lots of it. Reserves point to at least a 60-year supply, says the Natural Gas Supply Association. Only 56 percent of crude oil for U.S. refineries comes from North America, compared with 98 percent of the natural gas consumed. About half of all American homes are equipped for natural gas.”

Natural gas hasn’t been explored enough as a transportation alternative in the U.S., especially compared to Europe, and that needs to change. While the U.S. only has about 1,500 natural gas fueling stations in the country as of 2008, Europe is a different story. Germany alone has nearly 800 stations. Even tiny Macedonia at the south-east of Europe has more than 200 natural gas stations, reports Pure Green Cars.

“In European Union, there are roughly 1, 000, 000 natural-gas-powered vehicles – about 10 percent of the world’s total and at least six times the number in the United States. Almost 40 percent are in Italy, where a large market has developed since the 1930s.”

“European manufacturers have been aggressively pushing natural gas cars. Almost every automaker in Europe offer at least one natural gas model,” Pure Green reports.

Natural gas is also one of the cleanest burning alternative fuels available. Its exhaust emissions are much lower than gasoline-powered vehicles. “Smog-producing gases, such as carbon monoxide and nitrogen oxides, are reduced by more than 90 percent and 60 percent respectively and carbon dioxide, a greenhouse gas, is reduced by 30 percent-40 percent,” Pure Green reports.

“In addition, commercially available medium- and heavy-duty natural gas engines have demonstrated over 90 percent reductions of carbon monoxide (CO) and particulate matter and more than 50 percent reduction in nitrogen oxides (NOx) relative to commercial diesel engines,”
Pure Green cars continues.

To add to the advantages, natural gas is also cheap. And the U.S. Department of Energy expects natural gas prices to stay low, while the price of petrol and diesel are rising.

Given that natural gas cars already exist and sell in Europe and Asia, the move to this alternative fuel in the U.S. isn’t that difficult.

The fuel is cheaper, cleaner and plentiful. We think the big oil companies may be on to something.