EDCUtah's annual meeting is coming soon and we hope you will plan now to attend. It's an important event where we recognize in-coming and out-going board members and officers, review our progress in fiscal year 2009-2010, and get a snapshot of what to look for in fiscal 2010-2011.

This year we have the great fortune of securing Ben Stein as our keynote speaker. You may know him from his work in the entertainment world ("Ferris Bueller's Day Off" or "Win Ben Stein's Money"). We have chosen Mr. Stein because of his extensive career as a renowned economist, lawyer, educator, commentator, and writer on economic issues. We know you will find him extremely insightful and, yes, very entertaining.



Please plan on attending and consider being a sponsor. The event will be held in the Grand America Hotel on Oct. 20, 2010. Registration begins at 7:30 a.m. followed by the breakfast meeting at 8 a.m. Table sponsorships are $1,000 for 10 Seats. Individual seats are $100 each. For sponsorship opportunities please contact Art Franks by email afranks@edcutah.org or phone (801) 323-4242. RSVP by October 13, 2010 to Eileen Burt at eburt@edcutah.org.

Today's Economic Review also includes links to many of the ED-related news stories from the past week. As always, if you have comments, suggestions or topics you'd like to see in the Economic Review, please contact us by clicking the "Comments" link on the bottom of this page. Enjoy!

Jeff Edwards
President and CEO

Natural gas. And it costs less in Utah than anywhere else in the nation, according to the utility Questar Gas. What's more, the natural gas industry in Utah supports an estimated 36,769 direct, indirect and induced jobs and generates $2.9 billion for the economy, according to BlueJobs.org. Its website says the data was compiled and calculated using information from 2008 natural gas production numbers from the U.S. Energy Information Administration's "Monthly Energy Review" released in March 2009, and from a report by PriceWaterHouseCoopers.

According to the Energy Information Administration, Utah ranked 9th in natural gas gross production among the states in 2008, the latest year for which data is available. That number does not include federal offshore production areas. Utah is home to two of the nation's 100 largest natural gas fields, while the state has 5,700 producing natural gas wells. Since the Beehive State only consumes 46 percent of the natural gas produced in the state, it is a net exporter of natural gas to other states.

Low Prices
Why are natural gas prices lower in Utah than anywhere else in the nation? There are three primary reasons, says Darren Shepherd, communication manager for Questar Gas. First, Questar produces its own supplies of natural gas, which it is able to sell to its customers at cost, without mark up.

"During periods of low open-market (wholesale) prices, this supply offers small benefit, but when market prices rise with high demand, Questar Gas customers are protected against steep increases because the low-cost company-owned supplies help absorb the impact," he explains.

Second, he says, Questar has access to one of the west's largest underground natural gas storage facilities: Clay Basin in Daggett County, which holds approximately 117.5 billion cubic feet of natural gas. "The storage facility allows the company to purchase low-cost market gas during the summer months, inject it into the underground storage reservoir and then withdraw and deliver these supplies during the winter months when prices are typically higher."

Third, Shepherd explains that Utah sits next door to some of the most productive onshore gas fields in the country--in southwestern Wyoming and eastern Colorado. That close proximity, along with Interstate pipelines that crisscross the state, allows the company to deliver gas to its Utah customers more cheaply than other states.

Utah's abundant supplies and low prices for natural gas are a boon to economic development, and "a significant factor in our ability to recruit both large and small businesses to the state," says EDCUtah President & CEO Jeff Edwards. "We are fortunate to have a strong natural gas utility like Questar Gas, which is the only gas utility in the country that owns its own supply. It is also one of the most efficiently run utilities in the country."

Clean Burning Natural Gas
While more than four-fifths of Utah households use natural gas for home heating, the fuel is also important to power generation in the Beehive State. In fact, of the seven large power plants in Utah, three are natural gas-fired. Shepherd says the natural gas-fired plants produce far less harmful emissions than the coal-fired plants.

"Carbon dioxide emissions alone are cut by up to 50 percent when using natural gas instead of coal to generate electricity. This is one of the reasons the vast majority of plants built after the 1990s have been fueled by clean-burning natural gas," he explains. "These clean benefits are moving into the transportation sector, too. When compared to gasoline, vehicles running on natural gas emit up to 97 percent less carbon monoxide, up to 60 percent less nitrogen oxide and show reductions in other harmful pollutants."

Natural gas is certainly in greater demand by environmentally-conscious Utah drivers. Currently, there are 29 public natural gas vehicle (NGVs) fueling stations in Utah. Twenty-three are owned and operated by Questar Gas, five are owned and operated by the State of Utah, and one is privately owned by Semi Services, an NGV conversion shop. Shepherd says most of these fueling stations are located at retail-branded gasoline stations such as Chevron, Texaco, Phillips 66 and others. All of them sell their natural gas for the same price: $1.52 per gallon. In addition, there are more than 50 privately owned NGV fueling stations throughout the state, which are used to fuel fleet vehicles ranging from large trucks to indoor forklifts.

Shepherd says NGV fueling stations are a growing part of Questar's business model. The company just opened a NGV fueling station in Vernal to serve the growing number of NGV fleets operating there.

"People and businesses want to drive on a fuel that saves them money, helps protect the environment and reduces our country's dependence on foreign oil," he adds.

Consequently, Questar Gas, Clean Cities and the State of Utah have committed to create a network of NGV fueling stations allowing Utahns the opportunity to choose a cleaner-burning fuel for their transportation needs. Shepherd notes that Questar will be opening new NGV filling stations every month.

"When motorists drive NGVs, all residents breathe easier with less pollution. And every gallon of natural gas used in an NGV means one less gallon of petroleum that has to be imported," Shepherd says.

An Economic Development Partner
In addition to its role as a utility company, Questar is also an important economic development partner with EDCUtah. Says Ron Jibson, Questar president and CEO: "For more than a decade, Questar has loaned professional executives to EDCUtah to provide energy-specific skills that help attract quality businesses to Utah. Currently, that Questar professional is Brad Baird. His expertise in business, energy and real estate helps showcase Utah's industrious economy, talented workforce, business-friendly culture, diverse landscape and abundant energy."

Edwards agrees. "Brad has been a wonderful resource for EDCUtah and we rely on his expertise daily. We are greatly appreciative of Questar for loaning Brad to us and know that we are more effective in our economic development efforts because he is part of the team."

Questar Corporation Snapshot
Growing from its roots in 1922 as a natural gas exploration and production company, Questar Corporation is today a thriving energy company with 1,700 employees and three subsidiary lines of business:

• Wexpro Company, which develops and produces natural gas on behalf of Questar Gas Company's utility customers.
• Questar Pipeline Company, which operates interstate natural gas pipelines and storage facilities and provides other energy services in the western United States.
• Questar Gas Company, a regulated natural gas distribution utility serving over 900,000 homes and businesses in Utah, Wyoming, and Idaho. Questar Gas heats approximately 90 percent of Utah homes, while 98 percent of the Utah market relies on Questar Gas for water heating.

"We're always on the top of lists of Utah's top employers in terms of numbers. We're one of a few Utah-headquartered companies traded on the New York Stock Exchange. And we're as proud of our commitment to the communities in which we operate (through United Way, Junior Achievement, The Utah Food Bank and local volunteer efforts) as we are our customer satisfaction rating," Shepherd says.

According to current estimates, Questar Corporation, which has a market cap of $2.92 billion, will pay federal, state, property and production taxes of approximately $150 million this year, not including employee taxes. Beginning in January 2012, Questar Corporation will occupy a new building, to be called the Questar Center, at 333 South State Street. It will be the corporation's new headquarters and accommodate some 600 employees in a floor plan that is 20 percent smaller than Questar's current headquarters, but better organized and more efficient.

On June 30, Questar Corporation created and spun off QEP Resources, Inc., a domestic U.S. exploration and production company. Shepherd says the spin-off allows Questar to focus on its core businesses.