Concerns that the low price and supply glut of natural gas will slow the Mahoning Valley shale boom is more and more looking like a false alarm.
In fact, it looks more and more like even government incentives are unnecessary to boost the shale play.
Chesapeake Energy Corp. plans to provide 10 to 20 compressed natural gas filling stations in northeast Ohio, Western Pennsylvania and West Virginia. This development fits a national trend that appears destined to create a permanent, robust market for the oil and natural gas in the Utica Shale that lies deep underground in Trumbull and Mahoning counties.
CNG, and its counterpart LNG, or liquified natural gas, costs about $1.50 per gallon cheaper than diesel. That means a long-haul truck traveling the typical 100,000 miles in a year would save $20,000 in fuel. In just two years, the extra $40,000 it takes to buy a CNG- or LNG-powered truck will have paid for itself.
Ryder, United Parcel Service Inc., Dillon Transport Inc., Mohawk Industries Inc., Dean Foods Co., Staples Inc. and Swift are all among those slowly converting their fleets to natural gas. UPS has 59 tractor-trailers powered by LNG in its fleet. Ryder's fleet of 45,000 semis includes about 250 on natural gas.
The fact now is companies that do not convert their fleets to natural gas will find themselves at an economic disadvantage against their competitors. Thus, no government incentives such as the proposed T. Boone Pickens Act, the proposed NAT GAS Act, President Obama's plans or promises made by any of the GOP presidential candidates are needed to secure the local shale play's contribution to the natural gas market.
''We've got to take advantage of this incredible natural resource,'' Obama said while visiting a UPS facility in Las Vegas. ''Think about an America where more cars and trucks are running on domestic natural gas than foreign oil.''
There are 18 stations open to the public dispensing liquefied natural gas. Clean Energy Fuels Corp. plans to open 70 more this year and another 80 in 2013. They will be located at Pilot Travel Center and Flying J stations. There are Pilots and Flying Js along I-80 in Hubbard and Weathersfield.
Rather than try to convert the nation's entire vehicle fleet at once, the idea is to convert a couple hundred in a targeted geographic location to support natural gas filling stations in that region. The conversion then expands from there.
Naturally, one of those locations is the Mahoning Valley. Chesapeake's plan for CNG filling stations here means our local companies can gain a competitive advantage of lower fuel costs. And the impending Mahoning Valley shale boom looks more secure.