Wednesday, July 8, 2009

Key Senate Support for NatGas Vehicles

Dow Jones carried an article covering a press conference with T. Boone Pickens and Sen. Bob Martinez (D-NJ) on the subject of a Senate version of House Bill 1835, the NAT GAS Act, to provide tax credits for natural gas powered vehicles. The occasion was to demonstrate greater support for the legislation, especially from Senate Majority Leader Harry Reid, who apparently missed the press conference because of pressing work on health care reform. Sen. Reid's absence notwithstanding, it is encouraging to see that key members of political leadership are awakening to the benefits of using natural gas for powering vehicles.

Part of the article's focus was a comment by Mr. Pickens about gas prices. He was asked if using natgas for vehicle fuel would increase prices. He responded in the affirmative suggesting that prices might rise to about $7/Mcf (now about $3.45/Mcf). Given the fact that his hedge fund BP Capital lost billions incorrectly wagering on the price of gas last year, I wouldn't take that price prediction to the bank just yet.

Interestingly, at the end of the article Mr. Pickens clarified reports that he had cancelled plans for his big West Texas wind farm, saying instead that he had only postponed plans by a year or two. What he is going to do with 687 mammoth turbines until then is unknown.

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