May 13, 2006

Air Force Kick Starting GTL?

Gas to Liquid (GTL) processing of various fuel stocks to liquid motor fuels is currently economical. The investment needed to build large plants is slow going because the unpredictable energy market could leave investors holding the bag. What's needed is a big purchaser willing to make a long term purchasing commitment. In steps the US Air Force.

In short, they're testing to verify that the new fuel will work well on their current engine stock and not require expensive retuning. Once that's demonstrated, long-term contracts can be signed justifying the expense of plant building. Once an initial plant is built, it's much less risky to increase capacity and pull in additional customers.

The popularization of new technology can often come on the back of government purchases. Here's hopeing we don't get burned.

Posted by TMLutas at May 13, 2006 08:45 PM