Wednesday, April 12, 2006

Streicher Mobile (FUEL)

Streicher Mobile (FUEL) is in EXTREMELY high demand right now due to the fact that Ethanol can only be transported and distributed by trucks and rail...just read this, its from the EIA Department of Energy:


Probably the largest issue associated with increased ethanol use is distribution. Since EIA has not performed detailed analysis of ethanol transportation issues, the EIA transportation paper largely summarizes recent work by Downstream Alternatives, Inc., (DAI) for the U.S. Department of Energy. The DAI analysis found that expanding the market for ethanol to 5.1 billion gallons per year results in an estimated average national cost of about 8 cents per gallon of ethanol to transport it to markets. This translates to a cost of about 1 cent per gallon of gasoline when 10 percent ethanol is used. Delivery infrastructure issues requiring attention before demand reaches this level include: rail terminals able to unload more than a few cars, constraints on the Inland Waterway System, and a possible shortage of Oil Pollution Act of 1990-compliant Jones Act vessels. However, our analysis concludes that the major transportation mode for ethanol will be rail. The number of entities needing to invest to make the needed infrastructure changes is large, and breakdowns in pieces of the chain could affect ultimate supply availability. This implies that the transitions beginning in 2004, particularly the large volumes of ethanol required to flow to California, could result in some initial supply dislocations and price volatility. Even after the transition periods, coastal RFG areas dependent on ethanol, which requires a separate distribution system from gasoline that includes railcar and water transport, could experience increased price volatility if distribution becomes hampered due to events such as flooding and winter storms, as has been the case with other fuel disruptions.

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