Cassidy pushing CNG incentive

U.S. Rep. Bill Cassidy, R-Baton Rouge, is pushing legislation that he hopes will eventually lead to greater prevalence of compressed natural gas vehicles and pumping stations as gasoline alternatives.

With gas prices approaching $4 a gallon and the current low prices of natural gas, Cassidy contends such an approach would lead to an estimated equivalent of $1.50 a gallon for compressed natural gas.

Cassidy called natural gas a major “economic driver” in Louisiana and nationwide. Louisiana currently has the Haynesville Shale producing natural gas in northern Louisiana and the more recently targeted Tuscaloosa Marine Shale oil formation that runs through central Louisiana and is projected as having major potential through fracking.

The controversial drilling method of hydraulic fracturing, called “fracking,” involves injecting highly-pressurized fluid to release oil and/or natural gas from rock.

The problem with having CNG vehicles is there are very few places to fill the fuel tanks.

Cassidy’s legislation would remove IRS taxing provisions on independent natural gas producers like Apache and Chesapeake that limit them to $5 million in revenues from retail sales.

By removing the retail sales cap, Cassidy said private companies will invest in the CNG infrastructure by building fueling stations all over and motivate car companies to build CNG vehicles.

President Barack Obama this year has spoken more and more in favor of an increased focus on natural gas production, although Cassidy argued Obama’s actions haven’t backed up his words too much yet.

Cassidy said his plan would cost the federal government $50 million in tax revenues in 10 years, which he said is virtually zero in the totality of the federal budget.