THERE IS MUCH PRESS ABOUT THE CURRENT U.S. natural gas glut. The glut won't last for long. According to astrophysicist Michio Kaku, if the world economic growth rate averages 3 percent annually, within a century or two our civilization will need to master all forms of terrestrial energy and harness the potential resources of the entire planet including modifying the weather, mining the oceans, and extracting energy from the center of our planet.

Kaku reminds us that mankind has slowly been decarbonizing our sources of energy since we first harnessed the power of firewood, evolving from coal to oil, and now natural gas. With the recent combined technology breakthroughs in horizontal drilling and slick water fracking, this century will be the century of natural gas as we slowly evolve to the yet-to-be-determined next major source of energy.

If this is the century of natural gas, why are gas futures prices hovering at 10-year average low prices of $4 through 2011? No doubt, demand has eroded in the past two years as a result of the severe recession the United States is tepidly exiting. However, the market is excessively discounting gas prices due to the anticipated huge growth in supply from shale gas technology. This discount is too deep.

Based on recent major oil company acquisitions, it is clear the Marcellus shale is the mother lode of natural gas in the United States, now estimated to be the second-largest gas reserve in the world with more than 500 trillion cubic feet of estimated recoverable reserves. To get a sense of what impact Marcellus shale drilling might have on gas supplies I tried to figure out how many new Marcellus shale horizontal wells it would take to add 1 trillion cubic feet of annual gas supply for a country that consumes about 23 trillion cubic feet per year - about a 4 percent increase in supply.

I based my numbers on a conversation I recently had with the chief geologist of one of the major players in the Marcellus. He said that current drilling successes indicate new Marcellus wells can average as much as 2 million cubic feet per day for first-year production and may level off in the 500,000 cubic feet per day range after four to five years. This means that 1,370 new wells can produce 1 trillion cubic feet of gas in their first year of production. It will take about 5,500 mature wells at 500,000 cubic feet per day to produce 1 trillion cubic feet of gas annually. At 300,000 cubic feet per day, you need more than 9,100 mature shale wells to produce 1 trillion cubic feet annually. Considering the entire exploration and production industry has drilled about 2,000 wells in the first four years of drilling the Marcellus, and a little over 1,000 wells are expected to be permitted and drilled annually over the next two years, I would hardly view the Marcellus as the cause of the current gas glut.

In the meantime, President Barack Obama's recently lifted, but still effective, moratorium on deepwater drilling in the Gulf of Mexico will reduce gas supplies coming from the Gulf in the next 12 to 24 months. In addition, $4 per gallon gas makes many land-based gas fields in North America unprofitable and drilling in those fields is slowing down quickly. Like the Fed's interest rate moves, it takes 12 to 24 months for these events to work through the system.

The economic and environmental benefits of natural gas as a primary source of energy are compelling. Gas emits half of coal's carbon- based pollutants. At $4 per thousand cubic feet, gas sells for the energy equivalent of about $26 per barrel of oil - at a time when oil is selling for more than $80 per barrel. You can fill an energy-equivalent compressed natural gas fueled-car for about $7 per tank versus $45 for a 15-gallon gasoline fill.

Obama recently acknowledged the vast potential of the natural gas resources in the United States. Aubrey McClendon of Chesapeake Energy stated in a 60 Minutes segment that we have recently proved up the equivalent of twice the oil reserves in Saudi Arabia with U.S. natural gas shale formations - led by the Marcellus shale. It will take five to 10 years for the infrastructure and demand to catch up with the new shale gas reserves under development.

This will be the century of natural gas as we aggressively and environmentally consciously develop these new reserves worldwide. As we do so, the United States can become almost completely energy self-sufficient in the next five to 10 years, generating vast wealth for our nation.

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