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Natural gas vehicles could be gaining traction

10.01.2012  |  Thinnes, Billy,  Hydrocarbon Processing Staff, Houston, TX

Keywords: [natural gas] [diesel] [natural gas vehicles] [LNG] [commercial trucking fleets]

Natural gas vehicles could be gaining traction

A new report from PIRA Energy Group says that the sheer volume of US recoverable gas resources relative to expected demand suggests that benchmark Henry Hub gas prices will remain deeply discounted relative to oil prices beyond this decade. Furthermore, the lengthy period of low-cost gas relative to oil has tremendously broadened support for the view that inexpensive North American gas is here to stay. According to the report, by employing off-the-shelf technologies, consumers could be able to accrue substantial savings given the latent expected price advantages of natural gas vs. diesel. Such savings can also be attained in the transportation sector, particularly with regard to the much discussed development of natural gas vehicles (NGVs) (Fig. 2). The report concludes that future gas demand in such NGVs has enormous upside potential, led by private sector initiatives, with or without federal government assistance.

 

  Fig. 2. Natural gas vehicles, like this Honda
  Civic, are starting to gain traction in the US.



Adoption of natural gas into both US commercial trucking and all varieties of fleets is approaching a critical threshold, which ultimately could lead to enormous gas demand growth at the expense of diesel fuel. In an overall high case scenario, NGV gas demand would be capable of reaching 14 Bcfd by 2030, suggesting that as much as 2.4 MMbpd of diesel fuel demand could be at risk. Liquefied natural gas (LNG) consumed in Class 8 trucks would be responsible for approximately 70% of that total, 10 Bcfd. Fleet vehicles typically consuming compressed natural gas (CNG) would account for the additional 4 Bcfd. PIRA forecasts natural gas will capture a more moderate, but also impressive, 7 Bcfd share of the US on-highway transportation fuels market by 2030. HP



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