The Changing CNG/LNG Landscape - By Dr. Ken Morgan
It is now obvious that domestic and global energy companies are beginning to believe in unconventional shale-gas and potential markets in the U.S. In just a few short years, we have seen Exxon-Mobil, Shell, Chevron, BP and others buy out some independent producers in major shale plays. We have also witnessed countries such as France, India, Italy and China investing heavily in the U.S. gas shale business.
China alone has spent close to $30 billion in acquisitions and investments over the last 2 years in North America (Wall Street Journal, 2/26/2013).
While independents still control the playing field, together, the independents and majors will want to develop new and expanded markets for the tremendous supplies of natural gas stored in shales throughout the country. These markets will include using more natural gas as a base fuel for electrical production, as a back-up fuel for wind and solar and now even more attention for CNG and LNG as a transportation fuel. Just check out the CNG/LNG commitments being implemented by AT&T, Waste Management and UPS just to name a few. Also take note of widespread diesel conversions being implemented for city and school system buses. Perhaps these activities are part of the reason GM, Ford and Chrysler now produce their new “dual fuel” ¾ tone trucks and vans that run on both gasoline and natural gas. Keep in mind that 23 state governors have written to Detroit saying they will buy CNG state vehicles and companies like Clean Energy are out building the Natural Gas Highway across America. Also a really big company, BNSF Railway, recently announced their plans to begin using natural gas to power its locomotives instead of diesel. This sure makes sense, as they will be hauling more and more LNG throughout their rail network.
All of these ventures into using more natural gas for transportation could help reduce expensive oil imports, use up some of the glut of natural gas and ultimately help move the price closer to a more profitable range for the production companies. A healthier price for natural gas would give many companies a “double barrel” financial boost that would lead to more shale gas drilling activities from the Appalachians to the Rockies, generate more jobs and develop more domestic energy security.
About Dr. Ken Morgan
Dr. Ken Morgan is the founder and director of the Texas Christian University (TCU) Energy Institute, and currently chairs the Texas Metroplex NGV Consortium. He is also the director of TCU’s new School of Geology, Energy and The Environment. Dr. Morgan has published numerous articles on the potential use of domestic natural gas in the U.S., and has lectured extensively throughout the U.S., Europe, Asia and the Middle East about resource mapping, energy technology and emerging natural gas markets. Dr. Morgan holds degrees in geology, environmental engineering and resource management, and drives a Honda GX-NGV to help promote the use of clean burning natural gas.