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Natural Gas Issues

Natural Gas Issues. VCU Energy and Sustainability Conference Michael Woytowich Honeywell International Global Energy Leader. Honeywell International, Inc. Fortune 100 Company Revenues $138 Billion 130,000 employees worldwide Strategic Business Groups Automation and Control Systems

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Natural Gas Issues

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  1. Natural Gas Issues VCU Energy and Sustainability Conference Michael Woytowich Honeywell International Global Energy Leader

  2. Honeywell International, Inc • Fortune 100 Company • Revenues $138 Billion • 130,000 employees worldwide • Strategic Business Groups • Automation and Control Systems • Energy Controls and Solutions, Thermostats • Transportation Systems • Turbochargers, Brakes (Bendix) • Aerospace • Defense and Space systems • Performance Materials and Technology • Chemicals and Resins

  3. Performance Materials and Technology • Business Units • Specialty Products – Packaging • Electronic Materials – Semiconductor products • Fluorine Products – Refrigerants, blowing agents • Resins and Chemicals – Fibers • UOP – Catalysts • Manufacturing sites in NA, Europe and Asia • Hopewell, VA – Resins and Chemical site • One of the largest industrial users of natural gas in Va • Top 20 DVP electric customer • Natural Gas raw material used to make ammonia • Ammonia used to make Resins and Fertilizer

  4. US gas prices have come down significantly since 2008 • Mid-Atlantic Region Basis Prices are down also

  5. Natural Gas Prices give the US a competitive advantage • European prices tied to Oil • Asian prices tied to LNG

  6. Natural Gas holding US electric prices in check through out US • Lower Cost Fuel for DVP plants and lower purchase power costs • Fuel Only does not include Base Rate and Rider increases • European electric prices rising on environmental costs • Japan higher on closure of nuclear plants due to Tsunami

  7. Benefits to US Economy • From 1995 to 2005 US use of gas in industry declined • Due to tight supply and high prices • Growth in Electric generation use offset industrail decline • During same period European natural gas use grew • Source EIA • Since 2005 US industry NG usage has been growing • Production growth outpacing consumption • European usage has been flat • Economic Growth over 3% in 2013 • The Petrochemical industry is expanding • Many new projects being planned • Ammonia plant to displace imports

  8. Virginia Infrastructure Issues • With Lower Costs Demand Grows • Manufacturing growth • Homes switching from Oil and Propane • LNG Exports • A number of VA manufactures would consider expanding • Can not get firm natural gas due to pipeline capacity limits • Recent cold Illustrates issues • Record send outs • Manufacturers were cut, curtailed or penalized • Virginia Industry needs more pipeline capacity to grow • Pipelines will not expand on speculation • Need a large firm anchor commitment – 250,000+/day • Pent up industrial demand large but not enough

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