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January 12, 2007

The purchase, transport, and sale of natural gas as a commodity with a specific energy value per cubic foot has transformed the natural gas industry from one of a system based on volume measurement to a system based on energy measurement. The following discussion will review the evolution of natural gas industry from a system of volume measurement to the present system of energy measurement. Natural gas has served as an important fuel through the centuries. It is believed that the first commercial use of natural gas was by the Chinese in 900 BC. The Chinese used a system of hollow bamboo to transport the natural gas from shallow wells. The gas was used as a fuel to extract salt from sea water. In 1816 manufactured gas from coal was first used in the United States to fuel gas lights. In 1821 near Fredonia, New York the first natural gas well was drilled in the United States. William Hart, a gunsmith, drilled the twenty-seven foot deep well near a creek outside Fredonia where gas bubbles had been noticed. As a result of this well, Hart is considered the father of the natural gas industry in the United Sates. In 1843 cast iron pipe started replacing wooden pipelines and the use of iron pipe provided the first reliable and safe method of transporting gas to market

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