Oil, Gas Companies Turning To Natural Gas-Diesel Fuel Blend

Jan 21, 2013

Technological advances in hydraulic fracturing, or fracking, are paving the way for companies to become both producers and consumers of natural gas. From Pennsylvania to Texas, diesel pump engines are being converted to operate on a cheaper bi-fuel mix of diesel and natural gas.

Douglas E. Kuntz, President and CEO of Pennsylvania General Energy Co. (PGE) said the new mixture would significantly cut costs. “When you look at the comparables, when you take a gallon of diesel fuel, and say it cost $3.60, the equivalent amount of natural gas needed would cost $0.47 to get the same energy value,” Kuntz said.

Several companies are already operating natural gas drilling rigs. PGE itself has started the process of converting a 16-pumping unit to function on a blend of 70 percent natural gas and 30 percent diesel fuel. The conversion should be complete in May.

Kuntz said the conversion to the bi-fuel blend is not limited to on-site machinery, but could include trucks and other transportation vehicles as well.

“As you can see, across our industry, as we have the natural gas available, obviously in the field where we’re developing these wells, using it on-site makes a lot of sense from a number of aspects,” Kuntz said.

The process also aims to improve the image of oil and gas companies on environmental issues. Because of the natural gas component, the engines will give off less sooty exhaust and other types of pollution.

Kuntz said he believes the trend will stay alive as machinery updates continue.

“The fracking side is the piece we had to finish up, or get converted over. Our drilling site is already running on a bi-fuel mix of natural gas and diesel fuel. So we just picked the largest areas of fuel usage and converted them first,” Kuntz said.

PGE plans to drill around 40 new Marcellus Shale wells this year with bi-fuel equipment, saving about 750,000 gallons of diesel.