I read with great interest a report from Bernstein Research. The report was issued November 2007, but I just got the chance to look at it in detail. Bernstein analysts Ben Dell, Amanda Goller and Scott Gruber put together the piece. They concluded that in the near- to medium term, natural gas supply would be in excess of demand in U.S. markets. Prices may be pushed down by an abundance of gas. Where is all this gas coming from? Texas, Wyoming and Oklahoma, mainly. These states have robust growth in gas production and lead an onshore revival. Growth in onshore gas--most of it flowing from unconventional reservoirs--is so strong that it should more than compensate for declining offshore and Canadian volumes. LNG imports are also booming. Bernstein reported that LNG imports to the U.S. were 3 Bcfpd in 2007, up strongly from prior-year levels. The upshot? U.S. supply will be 66.1 Bcfpd in 2008, and demand will be 65.8 Bcfpd, predicted Bernstein. A few years ago, who would have thought this was even possible? --by Peggy Williams, Senior Exploration Editor, Oil and Gas Investor. Contact me at pwilliams@hartenergy.com