Natural Gas Boom a Bust for Some

While the rapid expansion of the nation's available natural gas supply has generally benefitted most Americans with lower energy prices, a recent New York Times article describes how the production boom is hurting the very people who financially back and produce it. According to the article, the rapid increase in gas production created a supply glut that drove prices so low that gas companies are selling it for less than it costs to produce. The problem is compounded by companies' limited ability to reduce production due to (1) complex financing arrangements backing their production facilities and (2) leases for land that require them to drill or lose their rights to the land.  According to one investment banker cited in the article, "we just killed more meat than we could drag back to the cave and eat…Now we have a problem."