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With the glut of natural gas in the U.S., domestic companies are exploring different avenues of putting the cleaner-burning fuel to good use. Some, like Cheniere Energy (NYSEMKT: LNG ) , whose Sabine Pass terminal was the first LNG export venture to receive federal approval, are looking to export the stuff.
Others are using it right here in the U.S. to power trucks and other vehicles. Waste Management (NYSE: WM ) , for instance, has amassed a sizable fleet consisting of 2,000 trucks powered by compressed natural gas, or CNG. It even recently opened a new CNG fueling station in Bristol, Pa., to help fuel its growing fleet, as well as to provide fueling options for the public.
Along with LNG exporters and companies with large trucking fleets, other companies are also finding innovative ways of tapping the plentiful supply of U.S. natural gas. Let's take a closer look at three of them.
First up is oilfield services company Halliburton (NYSE: HAL ) , which recently revealed how it's using natural gas to fuel some of its vehicles. In a YouTube video, the company announced the addition of nearly 100 new light-duty trucks that can run on compressed natural gas.
The trucks, which can burn either CNG or gasoline, will be used for regular business operations, such as transporting personnel and equipment, in various locations where the company operates, including California, Colorado, Louisiana, Oklahoma, Pennsylvania, Texas, and Utah.
According to a statement by the company, the deployment of these trucks is part of a pilot program the company is implementing to help it decide how to expand its natural gas usage. The company's rationale behind using CNG has to do with cost savings and greenhouse gas emission reductions. Indeed, Halliburton reckons the new trucks will slash emissions by 90% when they burn CNG and save roughly $5,100 in annual fuel costs.
The company is also cozying up to the idea of using natural gas to fuel hydraulic fracking operations, an approach that exploration and production companies including Apache (NYSE: APA ) and Cabot Oil & Gas (NYSE: COG ) are already using.
As with converting trucks and other vehicles to run on natural gas, the main incentives for these companies to use natural gas in fracking are reduced emissions and fuel-cost savings. Earlier this year, Apache became the first energy exploration and production firm to power a full hydraulic fracturing operation using natural gas-burning engines -- a feat it accomplished at its Granite Wash operations in Oklahoma. By making the switch, Apache expects to lower fuel costs by roughly 60%, while also lowering emissions.
Cabot Oil & Gas
And more recently, Cabot Oil & Gas announced that it's using natural gas sourced from the Marcellus to fracture wells in its operations, marking the first time "field" gas has been used in northeastern Pennsylvania for fracking. The innovative duel-fuel technology, which uses engines capable of running on either natural gas or diesel, could help the company reduce its use of diesel by as much as 70%. In addition, it is expected to lead to reduced air emissions, reduced truck traffic, and substantial cost savings, Cabot said in a statement.
The bottom line
Halliburton, Apache, and Cabot's efforts in using natural gas in various ways are a promising development for the entire energy industry, as it moves toward minimizing its environmental impact. Not only is natural gas an inexpensive way to power a fleet of vehicles, but it can also help energy exploration and production companies slash their fuel costs, while simultaneously lowering greenhouse gas emissions.
With natural gas demand expected to grow sharply over the next few years, Chesapeake Energy -- the nation's second-largest gas producer -- stands out as a major beneficiary. Though the company has allocated the majority of its capital this year toward drilling in liquids-rich plays, natural gas still makes up more than three-quarters of its production mix. Will the company be able to ramp up oil production and survive until natural gas prices finally recover? Or will it languish under the weight of its heavy debt load? To answer that question and to learn more about Chesapeake and its enormous potential, you're invited to check out The Motley Fool's brand-new premium report on the company. Simply click here now to access your copy, and, as a bonus, you'll receive a full year of key updates and expert guidance as news continues to develop.