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More and more fracking drill rigs are converting to run on natural gas in preference to diesel, with the biggest affirmation of this being Apache Corp’s (NYSE:APA) announcement to power an entire fracking job with engines that run on natural gas.
Lyle Jensen, the CEO of American Power Group has said that his company received orders to convert 60 drilling rigs from diesel to a system that runs on natural gas in 2012; a 1,000% increase compared to 2011 when they received just 6 orders.
Most US rigs still run on diesel, but the number converting to natural gas is growing, mostly due to the facts that natural gas is cheaper and releases fewer emissions. Caterpillar (NYSE:CAT), Halliburton (NYSE:HAL), and Schlumberger (NYSE:SLB) all worked to convert Apache’s rig to run on natural gas, which has led to an estimated saving of 40% on fuel costs.
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Jensen said that the conversion would pay for itself within a year due to the reduced fuel costs, and even sooner if the gas released at the well head could be used directly.
Whilst American Power Group’s conversion technology will not completely eliminate the need to use diesel on a rig, it can help to cut diesel consumption by half.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com