"It's Like Winning the Lottery!" - Lawrence L.
According to an ABC News report, people are becoming "millionaires overnight." It's happening in Kansas, Pennsylvania, Texas, Oklahoma... All over the country.
One man from a tiny town of 1,458 is now looking "to reap as much as $1 million per year."
How are they doing it? Shockingly, it all comes down to an amazing 94-year-old man's invention. Go here to find out how his invention could hand you as much as $127,000 each year for 45 years. | |
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| Wednesday, May 7, 2014 | Issue #2286 | |
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The Fuel That Will Soon Change the World David Fessler, Energy and Infrastructure Strategist, The Oxford Club
 Fifteen years ago all the cars, trucks, trains and ships in the world were powered by oil.
Today, although we still rely on gasoline and diesel as our primary transportation fuels, we're now experimenting with cheaper, cleaner, quieter natural gas.
Moving away from petroleum and toward natural gas - which America has in abundance right under our feet - to power our cars, trucks, trains and ships would be transformative for American business and consumers, for the environment and for our national security.
Consider that we currently use more than four times as much crude oil (25% of the world's daily output) as we produce (6%). We have to import the rest.
If we could reduce our appetite for crude oil by using natural gas, it would have a huge impact on our balance of trade.
One look at our energy supplies and usage puts this all in perspective.
View larger image
On the left of the graph above are all U.S. energy sources; the numbers are percentages of total supply. On the right are the uses to which our energy is directed; the numbers are percentages of total usage. Transportation is responsible for 27% of all the energy we use, and 71% of that transportation is powered by petroleum.
Right now, only 0.735% of natural gas is used as a transportation fuel in the U.S.
The biggest problem with converting to natural gas is that we lack the necessary refueling infrastructure. Without that, it simply won't happen.
Let's take a look at how this problem might be solved, and by whom.
Natural Gas for Trucking
Diesel fuel prices are well over $4 per gallon just about everywhere in the U.S. The average price this week for compressed natural gas is $2.18.
The economic advantages of natural gas are obvious.
Right now, Navistar (NYSE: NAV), Freightliner, Peterbilt and Volvo (OTC: VOLVY) all manufacture 18-wheeler trucks that run on natural gas. As T. Boone Pickens has been saying for years, transforming our nation's truck fleet to natural gas cuts our crude oil use by one-third.
The problem is the lack of fueling stations.
Royal Dutch Shell PLC (NYSE: RDS.A) is stepping up.
In Alberta, Canada, Shell is installing LNG refueling equipment at select Shell Flying J truck stops. It's starting with three sites, and expanding from there.
In the U.S., Shell plans to install LNG refueling pumps at TravelCenters of America. Ultimately, Shell will have at least two LNG fueling stations at 100 existing TravelCenters of America and Petro Stopping Centers.
As you can see from Shell's map below, these are all located at key points on U.S. interstate highways. Construction of these centers is underway and should take about a year.
When completed, the U.S. will have a coast-to-coast LNG-fueled transportation network. Elen Phillips, a Shell vice president, says the company is "leveraging our strength as an integrated company to produce, liquefy, distribute and commercialize natural gas in transport - and TravelCenters of America is the ideal partner to help us bring this vision to life.
"We see great potential for LNG as a fuel option among our range of quality fuels. [It's] due to the sheer abundance and affordability of domestic natural gas in North America."
Natural Gas for Ships and Trains
Most ships run on diesel fuel or the especially dirty "bunker fuel." Both Europe and North America will require ships to reduce emissions beginning next year.
LNG is virtually free of particulates and sulfur, the two main pollutants targeted by the new regulations.
Norway is already using LNG-powered engines on ferries. On the Rhine River in the Netherlands, Shell has inland barges that run on LNG.
Germany and Singapore are also investing in LNG ship refueling hubs. Total SA (NYSE: TOT) is following Shell's lead and building LNG refueling infrastructure along European waterways.
Railroads are also facing stricter emission standards from federal regulators, with new rules set to take effect next year. But a conventional natural gas-powered engine isn't quite powerful enough for trains so the industry is exploring an engine that uses a small amount of diesel, mixed with natural gas, to get the necessary power.
Matt Rose, CEO of Burlington Northern, said he'll make a decision this year about whether to convert Burlington's entire fleet of engines.
Natural Gas for Cars
Natural gas-powered cars are already available. For example, Honda (NYSE: HMC) makes a natural gas-powered version of its popular Civic model. But it costs roughly $5,000 more than a conventional model, and at the moment there aren't nearly enough refueling stations.
You need a lot more filling stations for cars than you need for trucks. The U.S. has roughly 167,000 gasoline/diesel stations.
It would cost $8 billion to $12 billion to add compressed natural gas (CNG) refueling stations at just 10% of existing stations, according to a study by IHS-CERA, a business research organization. Adding CNG refueling costs an additional $300,000 to $3 million per station.
More work needs to be done. But a transformation away from petroleum and toward natural gas is possible - and it's beginning to happen now. It would save the industry and consumers billions, and get us completely off Middle Eastern oil. From where I sit, that looks like a no-brainer.
What do you think? Use the comment link below to share your views, or send us an email directly: Mailbag@InvestmentU.com.
Good Investing,
Dave
P.S. Royal Dutch Shell isn't the only company working on the conversion problem that Dave describes today. In fact, he has a report out right now that describes in detail six companies working to solve this very problem. And when they do, they stand to make investors very, very wealthy. For more information, click here. | |
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WHAT YOU MUST KNOW ABOUT DRONES
 Recently, we dispatched Marc Lichtenfeld to investigate the commercial drone space. What he uncovered was even bigger than we could have imagined...
Regardless of your personal feelings about drones, you need to watch Marc's report. Because, as cyber-defense expert P.W. Singer puts it, "it doesn't really matter if you're against this technology... it's coming." Click here to watch. | |
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