Argentina slider — 05 April 2012


(The video above is provided by CNGnow.)

There is a natural question to ask which is if the USA has so much natural gas–its reserves are second only to Russia while its output is greater according to Steven G. Grape of the U.S. Energy Information Administration–and if the price of gasoline has increased so much there then why does not the USA convert some of its passenger vehicles and heavy trucks to use natural gas? Certainly such a plan is well underway in Brazil, Argentina, Peru, and even Iran, American´s nemesis in the Middle East. South America has more than 4 million vehicles already using natural gas while the USA has scarcely more than 125,000. (If you own such a vehicle already in the USA you can find a filling station here. It is also possible to fill the tank from the gas line in your own house using a device such as this.)

The Natural Gas Vehicle Journal, based in Argentina, says the cost savings to drivers in the USA would be about 48% at current fuel prices.  Regarding the total number natural gas vehicles (NGV)and refuelling stations they report:


country NGV filling stations
 Argentina  2,067,548  900
 Peru  122,221  175
 USA  112,000  1,100
 China  600,000  2,500
Chile  8,064  15
 Iran  2,859,386  1,800


These vehicles are cleaner too regarding pollution which is definitely an issue here in Santiago, Chile where this magazine is based and in other parts of the world like the polluted cities of China.  The web site PackCNG says: “A major positive aspect of CNG use is that being a natural gas (methane content) its exhaust emissions contain just water vapour and minuscule quantity of carbon monoxide, no carbon or other particles. Being virtually pollution free CNG driven vehicles meet the most stringent of emission standards worldwide.”


The Pickens Plan 


Certainly T. Boone Pickens would agree with the notion that the USA should switch to NGV. This stereotypical, larger than life Texas oilman has turned green energy advocate. In July of last year Bloomberg news reported that Pickens, the Chairman and CEO of BP Capital, has spent $82 million promoting the user of natural gas to power vehicles and trucks.

But the so-called Pickens plan has run into political headwinds coming from the likes of Koch Industries. Pickens in a joint appearance with the Governor of Mississippi in March lashed out at those who would oppose his Natural Gas Act plan which would provide tax credits of $64,000 for the purchase of heavy trucks and lesser amounts for passenger cars.  Attacking Koch industries head on he said,  “They’re in the chemical business.  Their margins are better if they have cheap natural gas and they’re in the fertilizer business. Also they are one of the biggest recipients of ethanol subsidy and they import 61,000 barrels of OPEC crude.”

Pickens with the  Mississippi  governor at his side said, “While we wait for Washington and Congress to act, leadership is emerging at the state level, and this week, Mississippi, under the leadership of Gov. Phil Bryant, is helping move America further down the road towards meaningful progress on the energy front,” Pickens said.  Mississippi has put forth a plan to promote the use of natural gas vehicles there.

Obviously Pickens believes government involvement is important as does Dr. Jeffrey M. Seisler of Clean Fuels Consulting who we talk to below.  But as we will see Argentina is making the conversion without government subsidies.  The driver there is the cost savings vis-a-vis gasoline and diesel which costs 70% more than natural gas.


Clean Energy Fuels

(Video:  President Obama speaks at UPS facility on the use of natural gas for vehicles)

Bruce Russel is the Directory of Communications at Clean Energy Fuels, a firm in which Boone Pickens is a major stock holder. Asked about the use of NGV in the USA he said, “Fuel has been relatively cheap here for a long time so there was never any economic incentive to move to natural gas. It is taking hold rapidly now.  There are 8 million large class 8 trucks over the road trucks.  Only 1,500-2,000 are natural gas now, but many shippers and trucking operators are beginning to transition.  Up to 4 years ago there were none.”  He says that now all 5 major manufacturers make natural gas trucks.

As for passenger vehicles he says, “There are no vehicles to be had for all practical purposes. The light duty market is waiting for access to fueling and vehicles to fuel.”

Honda sells a natural gas vehicle in the USA the Honda Civic Natural Gas model.  Sales are scant. Bruce says he thinks they sold 2,000 last year. General Motors has say makes 20 NGV models in Europe and “not one in the USA”. Fiat, which he points out now owns Chrysler, sold something like 250,000 NGV in Italy last year. He holds out hope that with their large Chrysler dealership network they could sell those NGV Fiat vehicles in the USA.

The other issue he says is, “There are only about a 1,000 NGV fueling stations.” His company, Clear Energy, owns about 300 of them. He says , “We are building America’s Natural Gas highway” which in South America and Europe is called the “Blue Corridor project”. The idea is to provide a LNG (liquid natural gas) fueling station “every 200 miles or so”. This will give the country the infrastructure so that heavy trucks can run coast to coast without worrying about having no place to replace to refuel.

Liquid natural gas (LNG) he explains is used for heavy vehicles while compressed natural gas (CNG) is used for vehicles.  He says LNG because has more energy per weight than CNG . As for the economics he hays, “Right now the fuel savings for CNG is between $1.5 and $2 per gallon. ” Aftering incurring the extra cost to purchase or convert a vehicle, he says, “In less than a year they get pay back.”

Clean Fuels Consulting

Dr. Jeffrey M. Seisler is the CEO of Clean Fuels Consulting with offices in Brussels and Washington. He weighs in on the issue:

“There are four-plus-one primary drivers of NGV (and other alternative fuel vehicles) development.  1) Economics: both natural gas fuel price differential with petroleum fuel and the first cost of the vehicle, 2) degree of support from government, 3) degree of support from the associated energy industry; and 4) availability of technology that is more-or-less transparent to what consumers will find with petroleum-fuelled vehicles.

“The last and still very important motivator is the environmental benefits of the fuel and technology which, in the case of NGVs is very good, with about 20-25% less CO2 than petroleum vehicles, for example, plus low CO, NOX, particulates, etc.

“The most important of these for the average consumer is the economics. During periods of high gasoline/diesel prices NGVs become more popular because the fuel is about 30-50% cheaper than gasoline and diesel. But moving from the status quo petroleum fuels, with excellent technology and an abundance of fuelling stations is a challenge of mind-set for consumers and for government policy makers. The transition takes time, investment (by all the stakeholders), and the ability to get factory-built vehicles on the road or, in their absence, good retrofit vehicles of which there are many varieties.

“ As oil prices move above US$110-125 the world population of NGVs and the use of natural gas will increase sharply and steadily so long as the balance between the vehicles on the road and the available fuelling station growth is managed carefully. ”

Peru and Argentina

Peru and Argentina are two countries which have natural gas. The web site of statistics, Index Mundi,  ranks Peru as number 43 worldwide in oil production and Argentina as number 25.  The USA is 3rd and Chile 84th. (Argentina has recently taken back oil leases from the private Argentina oil firm YPF saying output has been lagging and there is talk of a nationalizing again this formerly state owned concern.)

While you can buy a vehicle which is ready to run on natural gas in most cases the practice in Peru and Argentina is to take gas or diesel powered vehicle to a shop which specializes in this conversion. You add a special kind of fuel injection system to the motor then install a cylinder of compressed natural gas into the trunk.  The upside of this so-called after market conversion is the vehicle is still able to run on gasoline.

As for the economics of the conversion the The Peruvian Association of Natural Gas puts it like this:

“At current prices of liquid fuels, it has been estimated to cost 65% less than 90 octane gasoline, 50% less than diesel and 48% less than LPG. Furthermore, the user would save much more as the engine life is extended requiring less maintenance costs…”

Mariela Bernardi is Managing Editor of the Natural Gas Vehicle journal .  While they are based in Buenos Aires they publish natural gas journals in Peru, Asia, Africa, and the United States.

Asked what is Argentina’s plan regarding converting their vehicles she says the focus is on trucks and not passenger cards, “The most important goal of Argentinean NGV industry is to have NGV heavy duty trucks. Trucks and buses powered by CNG will make a huge difference in favor of the economy and ecology in our country. Regarding oil, absolutely the country is experiencing a lack of the fuel and many problems regarding the prices of gasoline at the pump. In the short and medium term, shale gas deposits are a tool that will be very useful to try to solve this problem.”

Asked why the Picken Project is stalled in the USA she says, “I don’t agree with that. I think USA is starting with trucks and buses and maybe they are not yet a large number of private passenger NGVs but we read and write every day of new projects carried out there and that is growing.”

She says it costs 7,000 Argentina Pesos ($ 1,500 USD) to convert a light duty truck to natural gas usage. “ The government of Argentina doesn’t offer any kind of subsidy to the vehicle owner, it’s absolutely private. In Argentina is not usual at all to buy an OEM NGV.  Almost ALL vehicles are after-market conversions.”

At the end of each edition of their journal “Prensa Vehicular”  they cite statistics by which we can measure what are the dollar savings in each country for users of NGV.    Figures for Argentina and the United States are shown below:


country price per liter premium gas ($USD) price per liter regular gas ($USD) price per liter diesel fuel ($USD) price per cubic meter natural gas ($USD) % fuels savings over gasoline % fuels savings over diesel
 Argentina  0.86  0.73  1.00  0.27  69%  73%
USA 0.98  1.16  0.51  48%  56%

(Note:  AAA gives current premium and regular gas prices in the USA at $1.10 and $1.04 as of 4/04/2012.)

Of course one liter of fuel does not equal one cubic meter of natural gas in terms on mileage so you cannot use this chart to make a simple comparison in equal units like liters or gallons.  To consider this data in terms of miles or kilometers per gallon one must use the notion of a gasoline-gallon equivalent (GGE).  Prices of compressed natural gas in the USA at filling stations are given in GGE so that the motorist can gauge the price relative to the price of a gallon of gasoline.  The numbers are based upon the potential energy of each fuel in for example BTUs (British Thermal Units).  The actual mileage of course would vary based upon the engine design and other factors.  For example a car manufactured to run on compressed natural gas should get better mileage than an after market conversion.  Looked at another way Honda says its natural gas Civic, which they say gets 31 miles per gallon in GGE, holds 8.03 GGE of compressed natural gas at 3600 psi (pressure).  Still GGE is a useful tool for comparison and it is certain to cheer one up when they see prices at, say, $1.80 GGE which they are today at this Clean Energy filling station in Atlanta.

To consider another source and look at how one might derive such a calculate here is an example taken from China Central television.  The 32% cost savings cited here are different than the 44% given by the Natural Gas journal.  But this is just one isolated example and not given with any scientific rigour.

“The owner took the example of a 1.6-liter-engine Volkswagen Jetta to further illustrate the savings. Filling its 55-liter tank with No. 93 grade petrol will cost 441 yuan (about 69.98 US dollars) at the current rate of 8.02 yuan per liter (about 1.27 US dollars). The car is quoted as being able to go 630 km on one tank. The garage owner said you could drive the same distance on 37 cubic meters of natural gas at a cost of only 148 yuan (about 23.49 US dollars), or at around one third the cost of regular gas.”

So to put this in terms an American can understand the Volkwagen Jetta was able to go 630 KM on 55 liters of gas or 391 miles per on 14.5 gallons or 26 miles per gallon. So in this case you can go the same 391 miles on 37 cubic meters of natural gas the garage owner said. In the USA that natural gas today would cost 1.16 * 37 = $42.92 while the cost for that 14.5 gallons of gasoline would costs 14.5 * 1.04 * 3.78 (liters per gallon) = $57.00 if you used regular fuel. In this case the gasoline fuel savings is only (57 – 42.92) / 42.92 = 32%.

Regarding the situation in Chile , a country that does not have much natural gas or oil, Mariela says, “I think there’s not a strong political will in Chile to boost NGV usage. Of course there’s also very important the fact of the lack of gas and the difficulties it has of getting it from even bordering countries such as Argentina. At the beginning it’s the egg-chicken problem. There’s no stations, so there’s no conversions. On the other hand, investors do not install CNG stations because there aren’t NGVs. So, I add there’s no strong political will and the private sector has not fully decided to start by themselves this kind of initiatives that can take many years.”  A taxi cab owner here in Chile said in an interview that is costs $2,500 to convert a cab to natural gas usage.  Those who did that some years ago were left hanging when Argentina cut off the supply. Bolivia and have natural gas too but Bolivia and Chile have a dispute over access to the ocean and Peru has a similar border dispute with Chile.


Related Links



About Author

(3) Readers Comments

  1. I don’t even know the way I stopped up here, however I assumed this publish was once good. I do not understand who you might be however certainly you’re going to a well-known blogger if you are not already. Cheers!

  2. Huge hobby horse of mine

    Mr Pickens is dead right

    Not even sure has to be lng

    dedicated honda civic does 200 miles.

    Not all big rigs are weight restricted, certainly not on the tractor – an advantage if anything – – they can have big tanks

    this is americas big chance at salvation, but pickens seems to shout into the wind

    It should be a simple & cheap matter for a big rig or a train to tavel the big trunk routes in USA

    cng every 150 miles at worst – how hard is that?

    the network will grow, unsubsidised , from there

    u do see the bottom line here?

    humble countries like these seem way better governed.

    your leaders in US rr leaving u v vulnerable to economic disaster
    Trains – dont start me

    imagine the deisel to get a freight train just from LA to the top of the rockies

    just as a shuttle/tug, a gas loco would be a big, cheap, clean boost for the hard yards

    same for powder valley coal trains, over the eastern ranges also

    even hsr – pass on electrification – kiss

  3. Woah! I’m really digging the template/theme of this blog.
    It’s simple, yyet effective. A lot oof times it’s very difficult to get that “perfect balance”
    between usability and visual appeal. I must say you have done a excellent job with
    this. In addition, the blog loads extremely fast for me on Internet explorer.
    Outstanding Blog!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>