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Response to Tansy_Gold (Original post)

Mon Mar 25, 2013, 08:00 AM

21. Berkshire's BNSF Railway to Test Switch to Natural Gas

http://online.wsj.com/article/SB10001424127887324539404578342540494619344.html?mod=dist_smartbrief

BNSF Railway Co., one of the biggest U.S. consumers of diesel fuel, plans this year to test using natural gas to power its locomotives instead. If successful, the experiment could weaken oil's dominance as a transportation fuel and provide a new outlet for the glut of cheap natural gas in North America. The surplus, spurred by new technologies that unlock the fuel from underground rock formations, has sent natural-gas prices plummeting. That has prompted industries from electric utilities to tugboat operators to switch to gas. If freight rail joins the parade, it would usher in one of the most sweeping changes to the railroad industry in decades.

"This could be a transformational event for our railroad," BNSF Chief Executive Matt Rose said of the plan, which hasn't been publicly announced. Shifting to natural gas would "rank right up there" with the industry's historic transition away from steam engines last century, he said.

Freight railroads overwhelmingly are powered by diesel fuel refined from crude oil. BNSF, the largest railroad in the U.S., estimates it is the second-biggest user of diesel in the country, after the U.S. Navy. A potential shift to gas faces many hurdles, however, including getting approval from federal regulators on fuel-tank safety. Introducing gas also will require different fuel depots, special tanker cars to carry the fuel and training for depot workers. That won't come cheaply. Just retrofitting a diesel locomotive and adding the tanker car could add 50% to a locomotive's roughly $2 million price tag, though that increase would diminish as economies of scale take hold.

Mr. Rose said his company nevertheless would quickly move to a "retrofit of existing road locomotives" if the pilot locomotives prove reliable. The pilot trains are expected to get rolling this fall in the hopes retrofitting could begin about a year later...

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