I am starting to look at some of the natural gas stocks. It just doesn't make sence that oil continues to go up without NG eventually getting a bid.

I use this fellow for oil & gas. Subscription, but well worth the price.

http://oilandgas-investments.com

Until we get more LNG ports built, NG will be a local market and the price will reflect that.

http://www.hydrocarbons-technology.com/projects/kitimatlng

NG will eventually come into its own as a motor fuel. Here's one co. working in that area:

http://www.westport.com

The basic problem is infrastructure. You can't transport LNG by truck or by rail - far too dangerous - so you need transmission lines to filling stations, which is a big undertaking except on main transportation routes, such as the 401 between Toronto and Montreal. (see the Westport/Encana initiative on this)

Recently Pres. Obama made a speech where he talked up modular nuclear reactors as if they were something new. South Africa was working on this over a decade ago - the Chinese are working on it too, as you'd expect. Search Pebble Bed, or PBMR for more info. I think the technical issues will be overcome, and that high temp single-cycle reactors, whether modular or not, will come into play. The obvious application is in rail and municipal/industrial power generation, thus freeing up coal for conversion to liquid fuel for use in trucking, farming and aviation.

How does this relate to NG? Well, the less we use domestically, the more we have available for export at higher prices. We need the ports though. China is the main customer of course, but other energy poor nations will also buy LNG, assuming they have a port to receive it. Most of China's population and industrial activity is concentrated along the coast, so distribution is less of an issue than it is here.

The end game to all this is to stop wasting coal on power generation and convert it directly to motor fuel. You can make decent diesel fuel from coal, and if oil prices continue to rise, it's a viable option. The USA has huge coal reserves, so does Australia, Canada, China and S. Africa. This is probably the only path to overcoming dependancy on foreign oil. All these other so-called alternatives, wind, solar, tidal, etc don't address the motor fuel problem, or the fact that you need reliable base power, which none of them can provide.

I'm more convinced than ever that energy demand will be the driver of the next bull market, and that NG will play a significant role. Uranium, geothermal and dirty old coal itself are areas I'd also be looking at.

In the short run, NG could get a bid if for no other reason than it's cheap compared to oil, though whether that's sustainable or just a momentary effect is hard to say right now. We're hearing a lot of gloomy predictions on how the current chaos in Africa and the Mid-east will play out. I doubt it's as bad as they say, in fact the situation, once resolved, could cause a crash in oil prices, which is good short term, but bad for these alternative approaches which we're eventually going to need.

I'm taking a decade-long view on this and accumulating positions in mid-tier O&G co's that are likely targets for majors seeking to replace reserves. Also looking at service co's and drillers, especially the offshore/deep water guys. I doubt you'll see a repeat of the BP disaster anymore than you'll see another Chernobyl. Too much at stake.

ebear