Goodbye gasoline? GM gives natural gas cars a boost  

Reuters has a report on interest in the US in natural gas powered vehicles (fuelled by the optimistic belief that there is over a century of gas available from shale) - Goodbye gasoline? GM gives natural gas cars a boost.

General Motors Corp (GM.N) announced plans this week to develop its first natural gas-powered engine, overcoming its long aversion to alternative fuels and joining a host of smaller players working to put natural gas in car engines.

In Indianapolis, Marlon Kirby has built a new supercar that looks much like all the others - sleek, curvy, low to the ground - but which differs from its gasoline-guzzling counterparts in one major way: it runs on liquid natural gas. After 21,000 man hours, the $1 million Maxximus LNG 2000 is ready for speed trials and Kirby expects it to top 200 miles per hour.

GM (GM.N), the automobile powerhouse and Kirby, the niche mechanic, are at opposite ends of the same movement; to make car engines that use the country's abundant, cheap supplies of natural gas.

The United States has more natural gas than it knows what to do with - up to 100 years of supply, experts say - thanks to a new drilling technique called hydraulic fracturing which releases huge reserves of natural gas trapped in shale rock.

Natural gas is used mainly in electricity generation and for industry, but with just 120,000 natural gas vehicles on the road and only 900 filling stations, transport remains a tiny fraction of total demand. However, assuming production forecasts are correct, natural gas will likely remain cheap for years and could help cut U.S. reliance on oil.

While crude prices soared above $110 a barrel this year due to unrest in the Middle East, U.S. natural gas prices, impervious to international influence, remained low as there was no shortage of natural gas at home. Drivers who fill up with natural gas at the pump saved up to $2 per gallon when gasoline prices hit $4 a gallon.

Car makers, manufacturers and fleet owners are quietly scrambling to run their engines on the cleaner-burning fossil fuel which was formerly the preserve of trash trucks and city buses. "With all the activity in shale gas, the natural gas price is decoupled from diesel. Natural gas is a lot more attractive given the situation in the market," said Ian Scott, president of Westport Innovations (WPT.TO) Light-Duty Division.

Vancouver-based Westport, which develops technologies to convert engines to run on natural gas, is working with GM on the multimillion-dollar project to develop a natural gas vehicle.