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Gas a counter-terrorism tool

O RING CNG Fuel Systems founder and CEO Bob Beatty believes his daughter won't have to wake every morning in the deserts of the Middle East fighting political wars as a member of the US military if the nation can better utilise the abundance of natural gas under its feet, <i>Energy News</i> learned on a recent tour Pennsylvania, the heart of the shale gas boom.

Gas a counter-terrorism tool

When the US shale revolution kicked off in 2006 the US Energy Information Administration believed the country had 215 trillion cubic feet of natural gas trapped in its shales.

By 2008 that number had tripled to 742Tcf and now exceeds 900Tcf, yet the nation only uses between 9-11% of it.

"While my daughter and son-in-law wake up every day in a desert somewhere doing their job for the military whether they agree with the conflict or not, the more cars I convert to natural gas, the more uses I find for a cleaner, greener energy source … maybe there will be less conflicts in the world," Beatty said.

"That's what drives me every day - using our resources rather than using someone else's.

"If you don't support the terrorists in their pockets, you don't have to fight them"

Beatty identified the opportunity eight years ago when he and his wife sank $US2 million of their life savings founding their business and starting a CNG fuel station in western Pennsylvania.

Then it cost more than $US4000 to convert a tank on a pick-up truck, but that rate has dropped by half and in another 3-4 years Beatty expects it to cost less than $500 as the utilisation grows and fuelling stations proliferate across the US.

At the moment a truck driver can traverse Pennsylvania on CNG with the number of fuelling stations available, and, while slightly more difficult on a national scale, Beatty says it could also be done across the US.

The US lags behind the rest of the world in using natural gas for vehicles, ranking fourteenth in gas utilisation for vehicles with less than 112,000 vehicles, behind Iran (2.5 million), Pakistan (2.85 million) and China (one million).

Why does Iran have as many people using natural gas in their vehicles as the population of Texas?

Beatty admits it's a cynical view but he believes it's because of the "fat, dumb and happy" syndrome in the US where people think they're going to have unlimited supply of oil forever, at whatever price it costs.

This is why he spends 80% of his time educating officials and the public, and just 20% actually creating infrastructure for the innovative (for the US) CNG technology.

"The average person knows where they're going to buy their next cell phone and who's trending on Twitter but have no idea where their energy is coming from. That's something that has to change, and it has to start at the grass roots level," he told Energy News.

"That hasn't happened from the top down, but from the bottom up."

He said a handful of bureaucrats in his own county know about CNG, but the average person on the street has never heard of it.

Presidential parody

He said a comment from President Barack Obama a few years ago encapsulated the ignorance of natural gas from the top down.

"Four years ago when our president was running for re-election he toured a General Motors factory and saw a Chevrolet Volt electric car and said ‘when I get out of office I want a Chevy Volt'. I joked that I sent him an email saying ‘I'll buy you one if you leave tomorrow'," Beatty said.

Beatty pointed out to Energy News that a Chevy Volt doesn't solve the problem of energy generation, and he said Obama's comment illustrated the perception of Star Trek-style fantasies that exist among people in power about the green energy solutions.

"A Chevy Volt just takes electricity out of a plug that still requires coal, oil or nuclear. We need to go back to the grass roots of it; natural gas can be used in its present form to do a lot of other things," he said.

"A lot of that is education. There's such a misconception about how bad natural gas is. There is no magic bullet. This isn't Star Trek; we won't wake up tomorrow and there will be a magic fuel source that replaces everything.

"If we need to replace oil, between [alternative fuel sources like] natural gas, ethanol and solar, if they just made up 20% of alternatives, the savings is billions of dollars and we can clean up the world once piece at a time."

The business opportunity alone is mind boggling, beyond the simple vehicle usage angle.

"The US navy alone buys 46 billion gallons of jet fuel a year for its planes. Can you imagine if we could tap into just 20% of that market with alternative diesel fuel? I would not have to look for another customer," Beatty said.

He has just opened another station 90 miles south of where he spoke to Energy News, and Ohio and West Virginia are expanding, but New York State is almost at a standstill due to its anti-fraccing rules.

"There are New York towns along the border of northern Pennsylvania who wish they could be annexed to become part of Pennsylvania so they can participate in our economic success," he said.

Beatty is also director of technology for Pittsburgh Green Cities initiative, which has a mission to promote the other sources to interface with the politicians - an effort, he says, falls on deaf ears on both sides of politics.

The Pennsylvania finance department has a host of programs that O Ring has helped businesses take advantage of, from grant programs for vehicles for alternative energy to assistance with funds to upgrade stations.

The legislation and regulation is just not catching up with this industry.

"Eight years ago I called the Department of Labour and Industry for a permit to operate a CNG station, and they didn't know what it was, so I had to help them draw up the regulations which now been adopted," he said.

He said that until the demand is created for that change, politicians won't take notice - which was why he took the initiative of investing his own money as seed capital, because waiting for politicians to move or the community to come around would never happen.

He added that with the Marcellus and Utica shales under its feet, Pennsylvania alone has enough natural gas to power the US for 100 years if fully utilised. If it gains just 2% annually beyond the current 10% rate there's a 500-year supply domestically.

He said the US consumed 97.5 quadrillion British thermal units worth of energy in 2011 - 36% petroleum, 25% natural gas, 20% coal, with renewables and nuclear another 10-15%.

"Even if gas doubles or triples, it's still as cost effective as oil. Sheer abundance will keep those prices low for decades - so natural gas is a price stable commodity," he said.

Then there is the fact that producers need to spend five times as much on oil wells as gas.

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