Investing in Natural Gas

In order to evaluate natural gas investments, it is important to understand how natural gas is measured. Production or how productive a particular well is a numbers game. A point to note when natural gas investing, natural gas is measured in cubic feet, and the three most common units are:

 

• Mcf (thousands of cubic feet)
• MMcf (millions of cubic feet)
• Bcf (billions of cubic feet)

 

Sometimes there is an "e" at the end of the unit, which simply stands for "equivalent" and is typically used to quantify reserves.

 

While the previous units measure quantity, another unit is used to measure the amount of energy generated from the natural gas: British Thermal Unit or Btu. One cubic foot of natural gas is roughly equivalent to 1,027 Btus. Btus is an important unit because that is the unit in which natural gas trades.

Remember for natural gas investments, A well's ability to produce natural gas will depend on its location. Having a good understanding of well production is the first step in choosing gas investments wisely when considering to natural gas invest. Be sure to contact us with any questions about natural gas investing or oil drilling stocks.