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changing railroads to run on natural gas
Posted by: grandpagates (IP Logged)
Date: February 3, 2011 06:50AM

I apologize in advance for discussing the possible scenario that oil prices will continue higher .... much higher .... over the next 20 years ....

I few months ago, here at gurufocus, there were links to T Boone Pickens talking up his proposal for congress to spend billions of dollars converting the US trucking fleat to natural gas.

Launching from that departure pointt seems to be that if energy prices were to continue to rise, not only would railroads have a huge advantage on trucks on disel, but it seems that it would be much easier for railroads to convert to natural gas. There are probably not more than several dozen railroad refueling stations nationwide?

There are scattered descriptions on the net of natgas locomotives being tried:

http://www.energyconversions.com/loco2.htm

http://utahrails.net/up/up-loco-features.php#natural-gas

http://winetrain.com/about/our-train



Also, a friend of mine in Thailand tells me it is common for folks to have cars that can run on any of three fuels: gas, natgas, and diesel (I think).

Also, the main disadvantaged of natgas in the bigger "gas tank" needed ...

So while failed Buffet experiment COP would end up spending all its profits from rising oil prices trying to find new reserves, and while XOM threw up its hands and bought natural gas reserves while comparatively cheap, and while congress runs out of deficit cap, and while people talk about the US having abundant cheap natural gas, the Buffett Railroad and its oligarchy of sister railroads could convert to natural gas and destroy trucking on long haul routes.

Arriving finally at my main point, when Buffett looked into the future, COP and other companies/countries may have become reserve challenged but BNI had a relatively simple migration path to natgas. At least, easier to conceptualize than switching locomotives to solar, wind, or electric.



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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: February 3, 2011 10:44AM

Grandpagates, in the 2009 gouging I repurchased Westport Innovations as a long term speculation. (I'd previously owned it for many years up to 2007 or so.) It would be well worth your time to visit their site and read up on their Cummins - Westport joint venture and the quite impressive performance results from the engines Cummins is producing. Note that countries like India (where an engine plant has been built) might even be better markets for what you are suggesting.

http://www.westport.com/

Additional information is available at the Cummins-Westport link site below. Under the FAQ page they note that there are already 25,000 Cummins Westport engines in service worldwide with positive results.

http://www.cumminswestport.com/



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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: February 23, 2011 12:25PM

The idea of rail switching to natural gas may be worth exploring further as some in the trucking industry are already be making the switch...

UPS Announces LNG Truck Fleet Expansion Powered by Westport HD Systems


"UPS will now boast a fleet of more than 1,100 natural gas trucks including compressed natural gas (CNG) delivery vehicles powered by Cummins Westport engines and the current order of LNG tractors. "





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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: April 14, 2011 05:05PM

Hi Grandpagates, today's Vancouver Sun has the following article:

[www.vancouversun.com]étro+natural+locomotive+project/4615658/story.html

Westport Innovations joins CN, Gaz Métro in natural-gas locomotive project
BY LYNN MOORE, MONTREAL GAZETTE APRIL 14, 2011


Well, the link I posted above doesn't seem to work - here's another...

[www.newswire.ca]


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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: September 15, 2011 12:09PM

It's up just over 100% CAD since February.

Westport Rises on Shell Pact to Market Natural-Gas Vehicles


[news.businessweek.com]


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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: September 15, 2011 12:11PM

sorry - again, that link may not work - I'm having posting problems.


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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: December 5, 2011 10:21AM

One more recent news item of natural gas and railroads... This shows that the efficiency advantage that railroads have over trucking may be able to widen even further... GTL (Gas to Liquid) treatment of a natural gas into a liquid fuel could offer further advantages. Note: Shell recently completed a trial shipment of some kind of GTL fuel from Qatar to the US and other companies are working to enable natural gas to be converted to a liquid.


Westport Innovations Inc. Announces Consortium Agreement With Electro-Motive Diesel To Join SDTC Program And Develop Natural Gas Fuel System For Rail Locomotives


Westport Innovations Inc. announced that it has entered into an agreement with Electro-Motive Diesel (EMD), an original equipment manufacturer (OEM) of diesel-electric locomotives, to integrate Westport's high pressure direct injection (HPDI) technology and natural gas fuel system technologies into an EMD locomotive provided by Canadian National Railways (CN)

[www.reuters.com]


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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: February 29, 2012 10:34AM

sorry - deleting a duplicate posting (I had problems posting the one below due to dragging in quote &/or link)


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Re: changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: February 29, 2012 10:36AM

This highlights some risk to the railroads where the trucking companies are adopting natural gas before the railways do. Moreover, I don't know, but I'd guess that the lifespan of diesel-electric locomotive is far, far longer than that of a semi so rail's cost advantage in a rising crude price market may be significantly diminished until old locomotives are replaced with some new technology.


Interesting article proving costs and expansion plans of major trucking companies...


Trucks Run on U.S. Natural Gas in Pickens-Led Clean Energy Drive: Freight

[www.bloomberg.com]


As for Westport - the share price has seemed grossly overpriced and the company seems to agree by issuing shares, however, I can't estimate it's true future growth prospects.



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Re changing railroads to run on natural gas
Posted by: AlbertaSunwapta (IP Logged)
Date: October 2, 2012 10:01PM

More news again...

Natural gas-powered locomotive drives CN into eco-friendly(er) future

[news.nationalpost.com]


Note: At the moment I have no direct holdings in either CN or Westport (Westport has a lot of insider buying going on but in this article it indicates any CN's adoption of Westport or likely any competitor's technology will take years.)


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