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Interest grows in natural gas fueling stations

Jul 26, 2012 - By Martin Reed, Staff Writer

A school district in Sublette County should get one this fall.

Other compressed natural gas fueling stations are in the works after Encana Corp. partnered with Bailey Oil Co. to open the first such station north of Interstate 80 in Wyoming.

Encana Oil and Gas government affairs director Paul Ulrich spoke about new developments during the Wyoming Legislature's Joint Minerals, Business and Economic Development Commit-tee meeting in Riverton last month.

Ulrich said there are plans to build public filling stations in Rock Springs, Jackson, Laramie and Pinedale. Encana is partnering with a school district in Sublette County to construct a station that should open this fall, while Questar is also opening one in Pinedale.

In addition to Riverton, the state has stations in Evanston, Rock Springs and Cheyenne.

With the gallon equivalent of natural gas more than $2 cheaper than gasoline in many places, the popularity of vehicles using the fuel is increasing, Ulrich said.

"We're seeing some significant progress on fleet conversion," he said.

He noted several governmental agencies using natural gas vehicles including Fremont County government, the University of Wyoming, Central Wyoming College in Riverton and a school district in Pinedale.

Lawmakers and Ulrich discussed the government's role in using the alternative fuel source that can save taxpayers in the long run and promote industry development.

State Sen. Chris Rothfuss, D-Laramie, asked about the cost difference in buses running on natural gas compared to gasoline.

Ulrich said the price can be $20,000 to $30,000 extra for a natural gas vehicle. "You will get that money back on fuel savings," he said, adding there is additional benefit with a "much longer engine life."

State Sen. Kit Jennings, R-Casper, noted the lack of filling locations in Wyoming.

"There are a lot of states where these stations are popping up," Jennings said. "But when you come to Wyoming and look for these stations, we seem to be lacking."

Building stations could lead to more vehicles using natural gas in the state.

"It's a chicken-and-egg thing. I think the vehicles will come if there are places to fuel," Jennings said. "If our policy direction would be, 'Figure out how to get fueling stations out there' ... I think it's a win-win for everybody."

State Sen. Eli Bebout, R-Riverton, warned about government competing with the private sector. He agreed with Jennings that it "is a chicken and the egg."

The committee referenced House Bill 109 from the last session that proposed to allocate $250,000 to the state Department of Education to help bus purchases and $500,000 to the Department of Administration and Information to aid in filling station development.

Bebout noted the bill "didn't do real well last year. ... That doesn't mean it isn't a good bill."

Jennings suggested the Wyoming Business Council as the funding mechanism by providing loans for developing natural gas stations in the state.

Even looking at school buses as a place to start converting government vehicles, state Sen. Hank Coe, R-Cody, questioned where they could fill their tanks in Moorcroft, for example.

Ulrich said filling stations could range from about $200,000 to create a bus barn that would fill vehicles overnight to $1 million for a compressed natural gas station. State Rep. James Byrd, D-Cheyenne, said the state could take the lead with promoting natural gas as a popular vehicle fuel source.

Mark Larson, executive director of the Colorado Wyoming Petroleum Marketers and Convenience Store Association, noted the $500 billion worth of assets among the petroleum retailers.

A potential boost to natural gas could come from a smaller, cheaper filling station, Larson said. Chesapeake Energy and General Electric is developing a compressor unit that covers an 8-foot-by-10-foot area, he said.

Bailey Oil Co. owner Mike Bailey told the committee there is interest among gasoline retailers to move into natural gas.

"It's one of those build it and hope they will come," said Bailey, whose company has five gasoline stations total in Riverton, Lander and Dubois.

He said the petroleum marketers members are anxious to get involved, but the $1 million price tag is hefty.

"As the market expands, the costs are going to get a little more economical," he said.

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