The successes of the natural gas market in North America are driving major changes in the energy business. The impact of the gas revolution on the electric power industry gets a great deal of attention. One impact is to contributed to the ongoing decline in electricity prices in the US. Here are a few news articles discussing a trend that I think is going to be big — natural gas impacting the transportation market.
Gas is outcompeting coal in many markets. The railway industry, which depends heavily on coal carriage revenue, is being impacted. Here is news of CP Rail cancelling plans to expand into Wyoming’s Powder River coal basin.
There are lots of projects underway around the continent to replace diesel in trucking with natural gas. Here is news of the development of a natural gas trucking corridor from Alberta to the Pacific coast.
Another way to get gas into the transport sector is to convert it into transport fuels including sulphur-free diesel and jet fuel. This process can also produce paraffins, lube oils, and naphtha (important for pipelining bitumen). Here is a report Sasol’s peripatetic gas-to-liquids proposal. Cheap natural gas not enough to make GTL a success. Jurisdictions will need to create the conditions to sustain a low cost of capital and competitive labour costs to attract GTL investments. Here is a report on Shell’s GTL facility, called Pearl, in the Qatar.
I have posted on this subject in this post called “Future of Road Fuel”addressing the peak oil theory, and “Three Technologies Poised to Impact Oil Market” part of which compares the cost of Shell’s Pearl GTL facility with the cost of a green field oil refinery.