Before Southwestern Energy’s compressed natural gas station opened at SWN’s regional headquarters last week, Satterfield Fuels’ Gulf Gas Station on Oak Street was selling CNG for $1.55 per gas gallon equivalent or GGE.

Now that there are two CNG stations in Conway, both stations are selling CNG for $1.50 GGE.

Branch Satterfield, president of Satterfield Fuels, said the Gulf Gas Station’s CNG prices are based on competition, and he plans to match the competition in the area.

"I think it’s great for Conway and central Arkansas to have two CNG stations," he said. "It’s only going to benefit the people who want to adopt this technology. Now they’re going to receive the most value."

SWN communications specialist Chrsitina Fowler said the company couldn’t go into details about how the price of CNG is determined, but she also says competition is a factor.

"We do have a formula that is used to determine the price, but we will also be cognizant of local pricing to ensure our price is comparable," she said.

Clint Beauchamp, principal of ZeitEnergy, primary contractor on SWN’s CNG station, said there are many factors that can affect the price of CNG at the pump.

The two main reasons the prices may vary between the Satterfield’s station and SWN’s station, he said, are electric costs and capital costs.

Since Satterfield Fuels received a $235,000 grant from the Arkansas Energy Office for the installation of its CNG fueling pumps; the company doesn’t have as much capital costs as SWN, he said.

"The SWN station was built with no grants," Beauchamp said. "More capital costs effect the cost of the gas."

The cost of electricity to run the compressor also affects the price consumers pay at the pump.

The Satterfield CNG pumps have three storage tanks to save on electricity costs.

"When all storage vessels are filled and nobody’s at the dispenser the compressor shuts off by itself," Satterfield explained.

"When vehicles come in to fill, it will start with the high storage, then go to the middle storage then the low," he said. "Somewhere in between the middle and the low, the compressor starts back up and refills the vessels."

Another factor affecting the price per GGE is the underlying cost of natural gas through a local gas company as a regulated commercial rate.

Both Conway stations use CenterPoint Energy transportation services to deliver natural gas to their fueling pumps.

According to the CenterPoint Energy website, CNG stations are charged a $290 customer charge and $350 transportation administration fee. Then $6.17300 per one million British Thermal Units or MMBtu for the first 400 MMBtu and $0.95380 per MMBtu over 400 MMBtu.

Oklahoma has the cheapest CNG prices in the country with an average price of $1.33, Arkansas comes in second with an average of $1.36 and Connecticut has the most expensive CNG with an average price of $3.16, according to cngnow.com.

Beauchamp said prices vary from region to region because different states have different taxes on CNG, and some states have credits and incentives that competitively effect the price.

Arkansas has a seven percent severance tax on the market value of natural gas upon extraction.

Both the SWN station and Gulf Gas Station are selling CNG above the state average, but at the same price of $1.50 to remain competitive in the local market.

"We try to keep our prices as low as possible because we want people to take advantage of CNG," Fowler said.

(Staff writer Michelle Corbet can be reached by email at michelle.corbet@thecabin.net or by phone at 505-1215. To comment on this and other stories in the Log Cabin, log on to www.thecabin.net. Send us your news at www.thecabin.net/submit)