Crude Oil Essay

1757 Words Mar 31st, 2015 8 Pages
In today's fast paced society we as Americans rely on transportation and communication to support our personal needs, families and careers. For example, transportation, telecommunications, electricity, and manufacturing. Although these vehicles cannot be useful to society unless they're fueled and maintained by other resources such as crude oils, natural gas, coal, renewables, and uranium (nuclear). One area in particular I want to touch on is the creation of electricity. Therefore for the purpose of this paper I will discuss the advantages, and disadvantages of the resources required to produce electricity, their lifecycles, and economy and trade. Power generation is a viable source of producing electricity, and the fuel to …show more content…
Because of the controversial environmental concerns with coal fired power plants, and the spur of lower gas prices natural gas consumptions have been on the rise. The lifecycle of gas is similar to that of crude it can be transported in many ways but the most common transportation method is the interstate pipeline. The interstate pipeline consist of a number of components to ensure accuracy and integrity of gas delivery. To assure integrity the transportation of the gas it must pass through predetermined stages on the pipeline, and these stages are; compressor stations that pressurize the gas, metering stations to monitor the gas flow, valve stations that regulate and direct the flow of the gas through the pipeline, and control stations that monitor the delivery of the gas for economic reasons. The utility is fully responsible to supply the gas to the customers at an affordable price. In order to set pricing points and develop the natural gas future contracts the gas must be priced accordingly at the Henry Hub, a distribution point on the pipeline that allows this to happen. To assure adequate performance on both ends of the economic spectrum contracts have to be set in-place and adhered to by the supplier and consumer. For example a "Take or Pay" pricing structure is used by the generators and the fuel suppliers so arrangements can be made that ensures payback on consumption. Also

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