International Natural Gas In the 70's
Authors: Sampson H.M. 
Published: March 2010

This paper examines current energy needs and how they are to be met during the decade of the 70's, emphasizing the role of natural gas. Two major problems are discussed the financing of the energy industry and the impact of conservation and anti-pollution efforts. As supplements to traditional natural gas supplies, two possibilities are examined - the transport of the vast Prudhoe Bay reserve through Canada to the U.S. and the production of synthetic gas from coal. It is concluded that the major question is one of priorities.

Introduction

IT IS CLEAR that the decade of the 1970's will be one during which we will be greatly concerned with the availability as well as the price of energy on the North American Continent. For the first time, our ability to provide energy in required forms to maintain a rate of economic growth and level of prosperity that is the envy of the world seems threatened.

Energy And Economic Growth

Energy consumption and the standard of living of a nation are closely related. Experience has shown that those nations that have been able to convert resources into usable energy have continuously advanced their standard of living. A study of the European Common Market Nations illustrates this close correlation between energy usage and economic growth. Between 1950 and 1960, for the Common Market Nations as a group, Gross National Product grew at an annual rate of 5.5 per cent, and there was a corresponding rise in energy demand of 4.8 per cent.(1) In the year 1965, Gross National Product per capita in North America was $3,437 and energy consumption was 10.5 tons of coal equivalent. Western Europe, with about half this per-capita GNP ($1,685), consumed energy at about one-third our rate – 3.6 tons of coal equivalent. As you move down the scale to less developed countries, the relationship holds. Latin American countries, with a per-capita GNP of 11 per cent of that of the United States, used about 9 per cent as much energy. In the case of Africa, one of the most underdeveloped areas of the world, Gross National Product was at a level of $139 per capha and energy consumption was the equivalent of 1 ton of coal. Other regions throughout the world can be ranked in terms of productivity and personal income according to their utilization of energy. So close is the correlation that economic growth can be forecast rather accurately on the basis of energy consumption trends.

Projecting these factors to 1975 for the Common Market, energy requirements to feed high-energy-using industries, such as aluminum smelting and metallurgical processing, increased at a slightly higher annual rate than the GNP, while continuing to track very closely. In other words, as industrial development of a type which represents a higher order of economic self-sufficiency occurs, the rate of energy usage increases.

It becomes clear from this analysis that a failure to obtain energy resources to drive a country's economy will seriously affect that nation's ability to achieve and sustain a desired rate of economic growth – and the individual prosperity which goes hand-in-hand with such growth.