Pearl station is latest link in ‘natural gas highway’
The first liquified natural gas fueling station in Mississippi has been opened, adding a link to what has been called the natural gas highway.
Clean Energy Fuels Corp. installed a two-bay facility at the Pilot Flying J truck stop in Pearl in large part to support the fueling needs of Raven Transports.
Any hauler running on LGN can stop at the truck stop at 685 Highway 80 East. And the number of such heavy-duty vehicles is growing.
In 2008, legendary Texas oilman T. Boone Pickens, with a penchant and portfolio for alternative energy sources, proclaimed that just such a coast-to-coast “highway” was an attainable goal.
He had already co-founded Clean Energy in 1997, which has yet to make a profit.
Natural gas as a fuel for vehicles was part of Pickens’ plan announced in 2008 to lessen America’s dependence on foreign oil. Wind power was another, including a huge wind farm he envisioned for his home state. The farm, as part of the “Pickens Plan,” was abandoned in 2011.
Shares of Clean Energy stock closed Tuesday at $5.34 on the Nasdaq stock market. They have ranged from $3.73 to $10.48 in the past 52 weeks.
Pickens grabbed headlines earlier this month when he sold 697,000 shares of Clean Energy, but assured investors that he remains bullish on the stock and natural gas as a truck fuel.
Jacksonville, Fla.-based Raven announced on March 31 that it was adding 115 LNG-burning long-distance trucks.
In return, Clean Energy promised to support that commitment by adding fueling stations in Pearl, Atlanta, Birmingham and Theodore, Ala., and four mobile stations in the Southeast.
Pilot Flying J is the largest chain of travel centers in the nation, with 650, more than 60 of which have LNG stations, regional manager Dave Mangialardi said in a release.
The effort to shift to natural gas as the transportation fuel of the future “is moving and it’s positive,” said Stephen Silverman, chief operating officer of Raven.
And it has its challenges.
The price of a gallon of diesel fuel equivalent one day last week at the Pearl station was $2.74. A gallon of diesel was $2.34, reflecting the fact that the price of crude oil has not fully recovered after it dropped by 50 percent last year.
Additionally, mileage on LNG is about 15 percent less than on diesel, said Silverman, who said that, nevertheless, the company will eventually be all LNG. Already, 186 of the company’s fleet of 495 trucks are burning natural gas.
So why place your bet on natural gas? Silverman said that he believes that the global oil supply will remain unstable and that crude oil prices will spike next year.
Plus, the United States’ natural gas supply will be self-sustaining for 200 years, thanks to breakthroughs in recovery technology, such as hydraulic fracturing, he said.
In January 2014, Raven bought 36 natural-gas-fueled trucks to serve MillerCoors in a 275-mile radius of its brewery in Trenton, Ohio. That was when diesel was $3.85 and liquified natural gas was $2.66, Silverman said.
So at that time natural gas was a natural choice.
Then crude oil prices and consequently diesel started their precipitous fall in mid-2014.
Still, the price of natural gas has essentially not changed for the past three years, Silverman said.
Raven bought another 30 natural-gas fueled trucks in mid-2014 to serve MillerCoors’ brewery in Albany, Ga.
To serve a much larger area for Procter & Gamble, Raven added the 115 trucks a year later.
“That gave Clean Energy time to open stations,” he said.
A partner such as Clean Energy helps when you have to swallow the fact that a long-distance natural gas truck costs about $55,000 more than a diesel truck. And with no price break in sight, as Cummins Westport is thus far the only natural-gas engine maker.
Even so, when it comes right down to it, “it’s the right thing to do,” for the environment and for the company’s legacy, Silverman said.
“You really have to be committed to the environment. You really need to be committed to say it is a domestic product, which is good for this country.”
“Pickens may have thought that it can happen overnight. But nothing happens overnight,” Silverman said.
Raven is not alone in its commitment. UPS said earlier this year that it planned to expand its LNG tractor trucks by about 1,000 by the end of 2015, from about 100.
The U.S. Energy Information Administration foresees natural gas as a transportation fuel growing 11 percent annually.
Compressed natural gas has established itself as a fuel for heavy-duty trucks, especially in the waste-control industry, and also for buses. Clean Energy builds and operates CNG stations in addition to its LNG stations.
CNG, whose price is about $1.20 per diesel gallon equivalent, requires seven to eight hours to fill a tank, lending itself to such uses.
But it is not practical for long-distance trucks, which don’t return each night for refueling. Hence the need for the network of LNG stations across the country.