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Dominion Natural Gas Stability Report 2013

WHEREAS:
Natural gas has a long history of price volatility that has made it a risky fuel for electric generation in the past; and
 
Extraction of natural gas from shale by hydraulic fracturing with horizontal drilling (“fracking”) has led to an oversupply of natural gas and exceptionally low current prices that cannot be sustained over the lifespan of a new gas-fired generation plant; and
 
Estimates of the recoverable reserves of natural gas vary widely; and Increasing use of natural gas domestically is likely to increase prices; and
 
Export of liquefied natural gas into the international market may cause wide price swings such as are increasingly common in the market for petroleum; and
 
Increasing public concern and governmental scrutiny of fracking operations may limit the availability and cost of natural gas in the future; and

Concern about the risks of global warming and the contribution of natural gas to rising CO2 and methane concentrations in the atmosphere may result in carbon taxes, increased regulation, or other government actions that affect costs of production and price to consumers.

RESOLVED:
Shareholders request that the Board of Directors of Dominion Resources, Inc. (Dominion) prepare and make available to shareholders by December 31, 2013 a report addressing the long-term price stability of natural gas. The report should address questions surrounding the price of natural gas over the full design life of a new natural gas combined cycle electric generation facility. These questions include effects on price caused by:
 
• Increased demand for natural gas from other utilities, both for heat and for the generation of electricity; from export of liquid natural gas to other countries; and from growing use in trucks and automobiles as a substitute
for petroleum;
 
• Changes in the availability of natural gas supplies or the costs of extraction as a result of increased environmental regulations or from limitations on the use of water or other materials in the extraction process;
 
• Changes in the estimates of recoverable natural gas supplies; and
 
• A tax on carbon or methane emissions, or other costs or limitations imposed as a result of concerns with climate change.