WSJ: Obama Touts Natural Gas As Transportation Fuel
Published: Jan 26, 2012
By Laura Meckler and Keith Johnson
Of THE WALL STREET JOURNAL
LAS VEGAS (Dow Jones)--Working to advance his "all of the above" energy strategy, President Barack Obama embraced natural gas as a transportation fuel on Thursday, saying it is cleaner and cheaper than oil, and much more abundant inside the United States.
"We've got a supply of natural gas under our feet that can last America nearly a hundred years.... It turns out we are the Saudi Arabia of natural gas," Mr. Obama said at a United Parcel Service Inc. (UPS) facility that will serve as a refueling station for trucks that run on liquefied natural gas. "Think about an America where more cars and trucks are running on domestic natural gas than on foreign oil."
The president officially opened the first natural-gas "corridor" linking the port of Long Beach, Calif., with Salt Lake City, where medium and heavy duty trucks can refuel along the way.
UPS used more than $5 million in federal support to upgrade its own fleet of trucks and complete the corridor.
(This story and related background material will be available on The Wall Street Journal website, WSJ.com.)
Mr. Obama nodded to concerns associated with hydraulic fracturing, known as fracking, a technique used to extract the natural gas that environmentalists worry will contaminate groundwater supplies. The White House said this week that the administration will require companies drilling for gas on public lands to disclose the chemicals they use.
"I know there are families worried about the impact this could have on our environment and on the health of our communities, and I share that concern," Mr. Obama said. "America will develop this resource without putting the health and safety of our citizens at risk."
Also Thursday, Mr. Obama announced the final lease sale of offshore acreage in the central Gulf of Mexico, scheduled for late June, with conditions meant to make sure that oil companies develop the leases they acquire, officials said. The lease sale of some 38 million acres will be the last one of the current five-year plan for development of offshore resources, and will include a sliding scale of rental rates to compensate deep-water lessees for delays in beginning operations in deep water in the wake of the 2010 BP PLC Deepwater Horizon oil spill.
According to administration officials, the latest Gulf lease sale could lead to the development of one billion barrels of oil.
The president has faced strong criticism on energy policy after he blocked for now the construction of the Keystone XL oil pipeline from Canada to the U.S. Gulf Coast. Republicans have excoriated that decision, saying Mr. Obama put the concerns of environmentalists over jobs.
Later Thursday, at an event at Buckley Air Force Base in Aurora, Colo., outside Denver, Mr. Obama was set to tout his administration's support for alternative energy, particularly through the military. The president was set to play up a Navy announcement that it will buy a gigawatt of clean energy, enough to power 250,000 homes at any given time, and point to a solar energy installation on the base.
The White House natural gas plan, contingent on congressional support, also includes tax credits to offset part of the cost of upgrading trucks to run on natural gas, and federal help to spur the creation of five additional natural-gas corridors on heavy trucking routes. Additionally, the Obama administration plans to promote federal research to find new ways to use natural-gas for transportation, as well as supporting the conversion of city bus and truck fleets to run on the cleaner fuel, administration officials said. The Obama administration's embrace of natural gas as a transportation fuel comes after years of similar efforts by high-profile proponents ranging from oil-and-gas tycoon T. Boone Pickens to Senate Majority Leader Harry Reid, a Nevada Democrat.
The Obama administration had signaled before that it favored the idea, but the president jumped in with both feet this week, first in his State of the Union speech Tuesday and then Thursday in Las Vegas.
The U.S. is experiencing an unexpected glut in natural-gas supplies thanks to a revolution in drilling technology over the last decade. Natural-gas prices have fallen near 10-year lows.
However, some important industrial sectors are less eager to see natural gas demand increase, notably big chemical and petrochemical concerns. They rely on cheap natural gas, a key input for their operations, to boost international competitiveness.
(END) Dow Jones Newswires
