About 112,000 natural-gas powered vehicles are now on U.S. roads.

Chesapeake Energy Corp. said it is working with General Electric Co GE and Whirlpool Corp. to develop a $500 appliance that will allow natural-gas powered cars to be refueled at their owners’ homes.



The effort would be Oklahoma City-based Chesapeake’s latest push to promote compressed natural gas as a mainstream fuel and boost its own sales. It is the first attempt at overcoming one of the biggest challenges in putting natural-gas powered cars on the road—convenient refueling.

Chesapeake and other natural gas producers have felt a cash crunch as a technology-led increase in natural gas production has led to a supply glut and brought prices to a decade-low in April. U.S. natural gas stockpiles were 3.929 trillion cubic feet last week, the highest level on record, according to the latest data from the U.S. Energy Information Administration

About 112,000 natural-gas powered vehicles are now on U.S. roads, mostly delivery trucks and other vehicles driving a set circuitous route with easy access to refueling stations. Auto makers have been slower to offer compressed natural gas-fueled passenger cars and trucks, in part because not enough refueling stations exist to service them on long trips. About 540 stations are open to the public, according to the U.S. Department of Energy

The appliance that Chesapeake, GE And Whirlpool are developing will fit in a home garage, hook into a natural gas line and dispense compressed natural gas into vehicles designed to use the fuel, Chesapeake CEO Aubrey McClendon said on Tuesday during an investors’ conference.

GE confirmed its development effort; Whirlpool wasn’t available for immediate comment. Chesapeake said it couldn’t say when the two would make the appliance available.

Chesapeake says that once drivers can refill CNG cars at home, General Motors Co., Toyota Motor Corp 7203.TO -2.45% . and other auto makers will boost production of the vehicles. “When GM and Toyota see that, you’ll see the cars flying out,” Mr. McClendon said.

A $500 appliance that allows vehicle owners to refuel their CNG cars at home “is just smart thinking,” said GM spokeswoman Sharon Basel. “Providing a refueling infrastructure is exactly the kind of thing that needs to happen to expand the use of alternative fuels,” she said.

In October, GE and Chesapeake, the second-largest U.S. natural gas producer afterExxon Mobil Corp XOM -1.68% ., announced a modular CNG refueling system advertised as being easy to install at existing gasoline service stations.

Exxon doesn’t share Chesapeake’s enthusiasm. The car market is “an area to watch,” but the cost to convert vehicles and infrastructure today outweighs the benefit, said William Colton, Exxon’s vice president of corporate strategic planning. “The math looks marginal at best,” Mr. Colton said, speaking at a conference in Houston.

The auto industry is in the early stages of equipping its vehicles to run on natural gas. Much of the current work focuses on equipping pickup trucks with natural gas storage tanks creating a bi-fuel vehicle that runs about 250 miles on compressed natural gas before switching to gasoline for an additional 115 miles.

Earlier this year, Chrysler Group LLC became the first to install natural gas tanks on its pickup trucks at the factory rather than sending the vehicles elsewhere for the installation. GM recently started production of the 2013 Chevrolet Silverado HD and GMC Sierra 2500 HD bi-fuel pickup trucks at its plants in Fort Wayne, Ind. The pickups are available for order by fleet and retail customers through Chevrolet and GMC dealers.

Ford has offered compressed natural gas prep kits for customer installation on about a half-dozen vehicles, including the Transit Connect, since 2009. It expanded the offering to its large Ford 650 pickup truck.

Another barrier to compressed gas going mainstream is the continuing increased fuel-efficiency of gasoline automobiles. Cars such as the Ford Fiesta and Dodge Dart, which promise 40 miles to the gallon, are denting sales of hybrid, diesels and electric vehicles.

Via Wall Street Journal