Jim Cramer Goes “Mad” Over NYT’s Sensationalism
Earlier this week the New York Times ran an article, “Insiders Sound an Alarm Amid a Natural Gas Rush,” on the prospects and economics of shale gas production. This article has met heavy criticism from multiple reputable sources as can be seen in rebuke’s from the Council on Foreign Relations, Forbes, Real Clear Politics and Real Clear Markets to name just a few. All of these sources, and more, looked at the limited data the NYT reviewed and easily contradicted their findings with the reams of information available on shale gas production which is at its highest point since 1973 (2009 annual natural gas summary ). Here is a quote from Aubrey K. Mclendon, CEO of Chesapeake Energy, which sums up the fallacy in the NYT’s premise quite succinctly.
“It is also ludicrous to allege that shale gas wells are underperforming as we sit awash in natural gas, with natural gas prices less than half of what they averaged in 2008,” he said. I also note that Chesapeake and other shale gas producers are routinely beating our production forecasts. How can shale wells be underperforming if shale gas companies are beating their production forecasts and as U.S. natural gas production has recently surged to record highs?”