HOUSTON -- Fort Worth-based BNSF Railway might be able to move a ton of freight nearly 500 miles on a single gallon of diesel, but that doesn't mean it's not interested in trimming its fuel bill by using natural gas instead.
With nearly 7,000 locomotives moving railcars over more than 30,000 miles of track, the big railroad last year shelled out $4.5 billion for fuel. Wednesday, CEO Matt Rose told the annual IHS CeraWeek energy conference that the nation's biggest rail carrier is studying liquefied natural gas, or LNG, as an alternative.If feasible, he said, "it would be truly the largest change" for the industry since the transition from the steam locomotive to diesel, Rose said. He told the Star-Telegram he believes BNSF is further along studying the issue than other U.S. railroads. Union Pacific and Norfolk Southern are also looking at the technology, Bloomberg News reported.While transit fleets like the Fort Worth T's city buses use compressed natural gas, LNG packs more energy into the same volume for greater range. LNG, which is chilled to 259 degrees below zero Fahrenheit and requires bulky containers to insulate it, is considered the preferred form of natural gas for heavy transportation services, such as trucks and locomotives."We are going to be doing a pilot during 2013" testing LNG, Rose said, noting that the railroad previously looked at LNG in the late 1980s. That program only lasted a couple of years and LNG proved too expensive at the time, he said.Recently, Rose said, BNSF has been working with its suppliers, General Electric and Caterpillar, for LNG-powered locomotives "and we think they have some great solutions." GE recently opened a factory in north Fort Worth to build locomotives, but Rose said he didn't know if an LNG-powered locomotive will be built there.Besides cost savings, LNG-powered locomotives would also offer lower emissions, he said, but considerable challenges remain.He said the company will spend 2013 evaluating six locomotives, three from GE and three from Caterpillar. Both have experience with LNG-powered engines in other applications, Rose told the Star-Telegram, so "it's not like they're reinventing" a new application."We need to make a decision on this in 2014," Rose said, because the industry faces new emissions standards in 2015 that will affect fleet decisions.Texas Railroad CommissionSeparately, Texas Railroad Commission Chairman Barry Smitherman said the agency, which oversees the oil and gas industry, will consider rules that encourage producers to recycle water used in hydraulic fracturing.Smitherman, who spoke on a panel at the CERA conference, told the Star-Telegram that the rules are not mandatory, but will try to "streamline the process" of handling and reusing produced water. For example, he said, there are proposals to ease permits required for holding ponds and water transportation if an operator is recycling water.He said he intends to vote in favor of the new rules. The agency's next public meeting is March 26.Smitherman said he expects Texas to have "three or four" LNG export terminals. The only U.S. LNG export terminal licensed and under construction is the Cheniere Energy project at Sabine Pass, on the Texas-Louisiana border. Other applications for permits have been made for terminals in Corpus Christi and Freeport. Another Sabine Pass facility, the Golden Pass LNG import terminal owned by Exxon Mobil and its partner, Qatar, is seeking an export license.Jim Fuquay, 817-390-7552Twitter: @jimfuquayHave more to add? News tip? Tell us
