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March 27, 2012 | Vol. 62, No. 07

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In This Issue
Dear PEI Member:

There has been a lot of talk recently about using domestically-produced compressed natural gas (CNG) to fuel cars and trucks.

Some argue that CNG will remain a fringe phenomenon for the foreseeable future. The high up-front cost of purchasing natural gas vehicles (NGVs), the lack of refueling stations, and the cost to outfit and install those refueling stations top the list of reasons why CNG-powered vehicles won't make major inroads in the U.S. market.

Indeed, there are some tough obstacles to overcome. While some companies and cities have incorporated NGVs into their fleets, so far only one manufacturer, Honda, sells a family automobile in the U.S. that runs on CNG. Honda's suggested retail price for the Honda Civic Natural Gas is $26,255, compared to $20,505 for the gasoline-powered Civic EXthe least expensive gasoline version of the Civic equipped with an automatic transmission. The federal government helped close that price gap beginning in 2005 by granting a tax credit of $4,000 to purchasers of the CNG-fueled Honda, but that credit expired on December 31, 2010. Steve Center, Honda's U.S. vice president for environmental business development, told Bloomberg News recently that Honda's goal is to sell 4,000 to 5,000 CNG vehicles annually, double the previous rate. (To help that along, Honda is installing CNG refueling stations at selected Honda dealers in California). The International Association for Natural Gas Vehicles notes on its website that there were 112,000 NGVs in the U.S. as of December 2010, ranking the U.S. 14th in the world in the number of CNG vehicles on the road―not exactly compelling numbers.

So, what has folks so excited about CNG-fueled vehicles? The answer is simple: Fuel prices. The average retail price of gasoline has increased more than three-fold in the last 10 years. A gallon of gasoline cost $1.18 in 2002. Right now, Americans pay an average of $3.90 for the same gallon of gasoline. With demand for oil in emerging markets expected to maintain its upward trend, even higher prices are likely to result in the future. Natural gas is cleaner, cheaper than gasoline and it is domestically available. To an increasing number of companies, it deserves a look―or, in some cases, another look.

Chesapeake Energy, the second largest producer of natural gas in the U.S., has been one of the biggest champions of NGVs. Chesapeake announced earlier this month that it will work with General Electric (GE) to promote the CNG and LNG (liquefied natural gas) infrastructure. Chesapeake and GE will deploy more than 250 of GE's ecomagination™-qualified "CNG In A Box™" fueling systems across the U.S. through 2015. CNG In A Box takes natural gas from a pipeline and compresses it on-site at an industrial location or at a traditional automotive refueling station to turn it into CNG.

Prospects for CNG Refueling Stations

EPA Approves E15 Mitigation Plan

PEI Scholarship Program Deadline: March 31

RP1200 Comment Period Ends

In This Issue


PEI and Industry News »


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In addition to divulging that it has already spent nearly $4 million with Love's and OnCue to build 40 new CNG stations in Oklahoma, Chesapeake identified the following petroleum marketers and grocery store chains that soon will be offering CNG: Valero, Murphy USA, Stripes, Gulf, Kroger, QuikTrip, 7-Eleven, Kum & Go, Meijer, GetGo from Giant Eagle, Wawa, Sheetz, Lehigh Gas and Dandy Mini Mart. Chesapeake also stated it expects that Clean Energy's Natural Gas Highway will be able to offer LNG truck fueling coast-to-coast and border-to-border by 2013. 

The automakers seem to be stepping up the pace as well. Chrysler said earlier this month that its new Ram 2500 Heavy Duty CNG truck will be sold to commercial customers that operate truck fleets. The truck will have natural gas tanks and an 8-gallon fuel tank for gasoline. Chrysler said a small amount of gasoline is needed to start the truck but, after ignition, it runs entirely on natural gas. If the natural gas tanks run out, the engine can switch to gasoline. The company expects to deliver the first trucks in July.

Other automakers are moving into the natural gas market. The day before the Chrysler announcement, General Motors said it would release two 2013-model pickup trucks powered in part by natural gas. The company said it would start taking orders in April for the natural gas-powered 2013 Chevrolet Silverado and GMC Sierra 2500 HD. GM expects to ship these vehicles toward the end of this year. The trucks will be available to both commercial fleet operators and retail customers. Mercedes-Benz and Fiat are said to be keeping an eye on the U.S. to see to what extent the market welcomes NGVs.

Interest in CNG vehicles and stations is on the uptick. We'd like to hear from you about how you think it will shake out. Respond to with your comments.

The U.S. Environmental Protection Agency (EPA) issued its approval on March 15 of a Misfueling Mitigation Plan submitted by the Renewable Fuels Association (RFA), bringing the fuel a step closer to being offered to the public. Individual ethanol producers can use the plan when applying to EPA to register their fuels. Many states still have regulatory issues that prevent E15 from being sold, but the RFA suggested that several statesspecifically Iowa, Illinois and Kansashave resolved these issues and are expected to be the first to introduce E15 to consumers. Many gasoline retailers maintain that liability and equipment compatibility concerns will prevent them from marketing E15 until those issues are resolved.

Registration and housing for the 2012 PEI Convention at the NACS Show will open April 2. The event will be held October 7-10 in Las Vegas, at the Las Vegas Convention Center. The PEI headquarters hotel is the newly named LVH (Las Vegas Hotel and Casino), formerly the Las Vegas Hilton. It will be the hub for several PEI events, such as the Young Executives Roundtables and Reception, and the PEI After-Hours Lounge, where PEI members gather after the trade show closes. PEI also has room blocks at Harrah's and Planet Hollywood Resort & Casino.

Exhibit space in the Petroleum Equipment & Services area is going fast, with only 53 booths remaining. Contact Bob Young to discuss exhibit opportunities at or 918-236-3966.

The PEI Board of Directors will meet next month, at which time convention sessions proposed by the PEI Education and Convention Committee will be finalized. Click to view a tentative schedule of events. More to come on this as session topics and speakers are confirmed.

Early registrants receive deep discounts. Full early-bird registration is $295 for members and $495 for nonmembers. This includes admission to the education sessions, all three days of the trade show, the PEI Industry Reception and the NACS Welcome Reception. Companies that register five or more employees are eligible for group discounts.

Be ready to register and make your hotel reservations on April 2 to enjoy the greatest savings and selection of hotel options.

South Dakota has awarded 80 percent
of the grant money ($755,000) set aside to help gasoline station owners install 44 blender pumps at 21 locations in the state. The state's grant program, overseen by the Governor's Office of Economic Development, pays station owners up to $25,000 for the first pump and $10,000 for each pump thereafter. The first round of grants was awarded on a first-come, first-served basis. The rest of the money―$3.5 million during the next five years―will be awarded competitively. The state is taking applications until April 30.
Tom Vilsack warned members of the Renewable Fuels Association that there continues to be a strong need to defend the Renewable Fuels Standard (RFS) mandates on ethanol, as well as to build a broader market for the fuel and to invest in innovative emerging technologies. Vilsack said he sees the ethanol industry as "the platform for our transition to producing more advanced biofuels." He said EPA's decision on E15 is important but maintaining the RFS is a greater priority, citing oil company efforts to modify or eliminate the federal mandate.Kansas Grain & Feed Association Federal News Friday newsletter, March 9, 2012, reporting on Secretary of Agriculture Tom Vilsack's remarks last month to the RFA's National Ethanol Conference.

The application period for the 2012-2013 PEI Foundation Charles D. Kemp Scholarships closes March 31. Scholarship recipients are selected based on academic achievement, leadership, character, financial need, and the applicant's intent to contribute to the future of the petroleum and energy handling industry.

To be eligible, an applicant must be a dependent of a full-time employee of a PEI member company in the Distributor, Manufacturer, Service & Construction or Affiliate Division. Applicants must be incoming freshmen at an accredited four-year college or university intending to major in business, engineering, distribution studies or a similar field. The scholarship awards are $1,000 each. To review the scholarship guidelines and complete an application, please visit

The public comment period for suggested changes to PEI's Recommended Practices for the Testing and Verification of Spill, Overfill, Leak Detection and Secondary Containment Equipment at UST Facilities closed yesterday. In all, 255 comments were received from tank owners, regulators, equipment manufacturers, testing companies and consultants. The committee responsible for writing the document will meet April 24-26 to begin its review of the comments. Publication of the recommended practice is expected sometime late this summer.

. SB 375, a bill that would phase out the state fund and state assurance for reimbursement for costs associated with a release from an underground storage tank, was the subject of a hearing of the General Assembly's Environment Committee on March 16. So many people turned out for the legislative hearing that an overflow room was opened so people could listen to the proceedings. The Connecticut Petroleum Association spoke out strongly against the proposed legislation.
North Carolina. The state's Gasoline and Oil Inspection Board has approved changes to rules governing the way ethanol and other oxygenated gasoline blends can be labeled. Under the proposed changes, gasoline containing 10 percent or less by volume of ethanol would be required to include a label that states "may contain up to 10 percent ethanol" or similar wording. For blends containing between 10 and 15 percent ethanol, the label would state "contains up to 15 percent ethanol" or similar wording. Any blend containing between 15 and 85 percent ethanol would be required to include a label stating the exact volume percentage of ethanol. E85 blends are not affected by the changes. The rules now go before the North Carolina Rules Review Commission.

ZCL Composites Inc.
has announced that Ron Bachmeier will assume the role of president and CEO of the company effective August 8, 2012. He has been with ZCL and Xerxes since 1986 and is currently ZCL's chief operating officer. Bachmeier will replace Rod Graham who earlier recommended to ZCL's Board of Directors that it was time to begin a transition to a new, permanent CEO.
The Steel Tank Institute/Steel Plate Fabricators Association
(STI/SPFA), Lake Zurich, Illinois, has promoted Marie Scimeca to manager of meetings and Noël Zak to manager of membership and communications.
OPW Fueling Components, A Dover Company, Hamilton, Ohio, has named Brandon Grote district manager responsible for sales activities in Ohio, Michigan, Indiana and Kentucky. In addition to his role as district manager, he will be utilized as a product specialist in dispensing products for key accounts and markets. Grote joined OPW in 2000.

North America Corporation, Addison, Illinois, has added a new division to the company: the SOLUTIONS Design Group. The new division will support customers and sales staff with expertise on fueling systems, piping layout and design, compliance and regulatory issues. James V. Gaszynski is director of the SOLUTIONS Design Group.
Casey's General Stores Inc.
, Ankeny, Iowa, announced March 15 that it will break ground this month on its first site in Kentucky and will likely move into Tennessee before the end of the year.
Sobeys, Stellarton, Nova Scotia, has completed the purchase of 236 Shell retail gasoline locations and related convenience store operations in Quebec and Atlantic Canada.

Missouri distributor
. Greenlight Solutions, LLC, P. O. Box 101, West Alton, Missouri 63386, has applied for distributor division membership. Ron Fink is operations manager for the firm, which was established in 2006. The company sells, installs, repairs and maintains petroleum marketing equipment. Greenlight represents Bennett, HuskyCorp, LSI, PtrParts, RDMElec and VeriFone. Sponsored for PEI membership by Richard H. Long, RDMElec, Nebo, NC.
CNG fueling equipment designer
. ANGI Energy Systems, LLC, 15 Plumb Street, Milton, Wisconsin 53563, has applied for affiliate division membership. Katrina Bell is the marketing coordinator for the company, which was established in 1983. The company designs, engineers and installs CNG fueling equipment systems. Sponsored for PEI membership by David Crouse, OPW-FC, Hamilton, OH.
Diesel fuel storage tank cleaning firm. Deposit Control Systems, Inc., 4 Green Mountain Drive, Cohoes, New York 12047, has applied for affiliate division membership. Tom Myers is president of the firm, which was established in 1996. The company cleans fuel storage tanks and provides other technical services. Sponsored for PEI membership by Patricia George, AlgaeXIntl, Fort Myers, FL.
Third party repair depot firm. United Technologies, 3270 Fowler Street, Suite 11, Fort Myers, Florida 33901, has applied for affiliate division membership in PEI. Thomas K. Tabor is vice president of sales and marketing for the firm, which was established in 2005. Sponsored for PEI membership by Suzanne Johnson, JohnsonFL, Riverview, FL.
Media dispenser display unit provider. Outsite Networks, Inc., 2551 Eltham Avenue, Suite N, Norfolk, Virginia 23513, has applied for affiliate division membership. Cindy Gould is operations manager for the firm, which was established in 1998. The company provides loyalty/marketing equipment and services for the convenience store industry. Sponsored for PEI membership by Charles B. Hubbard, OilEqSS-VA, Chesapeake, VA.
Ohio service and installation contactor. S. M. Miller Construction Co. Inc., 5755 Beatty Road, Grove City, Ohio 43123, has applied for service and construction division membership. Steve Miller is vice president of the company, which was established in 1991. The firm is a convenience store contractor. Sponsored for PEI membership by William R. Patrick, X-FPtrEqp, Columbus, OH. 


  • Fluid Solutions LLC, Birmingham, AL (dis)
  • GN Services, LLC, Spring, TX (S&C)
  • Russell Barton, Browning Oil Company, Bowling Green, KY (O&E)
  • Mike Wilson, The Pantry Inc., Sanford, NC (O&E)


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Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Robert N. Renkes, Executive Vice President, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.