Flying J Station Could Be the Start of Something Very Big
Shell has opened Canada’s first retail liquefied natural gas fueling station at a Shell Flying J truck stop in Calgary – a modest start that could be yet another sign of a revolution in transportation. The station on the Queen Elizabeth II Highway to Edmonton is part of Shell’s strategy to offer LNG in lieu of diesel not only for trucks but for ships and trains and the powerful engines used to produce oil and gas as well.
“For heavy-duty truck operators facing a challenging economic climate, LNG could be a cost competitive fuel option, particularly for those looking to invest in new fleet vehicles,” Shell Canada commercial fuels GM Jean-Marc Morin said in a release.
Shell Flying J LNG stations are to open in Edmonton in May and in Red Deer, about halfway between Calgary and Edmonton, later in the year, says Shell Canada LNG business development leader Mike Grossman.
The Calgary station is being furnished with fuel via truck from third-party sources as Shell readies a 250,000-ton-per-year natural gas liquefaction plant at Jumping Pound, west of Calgary, for 2014 start-up.
Later, after a similarly sized LNG plant opens in Sarnia, Ontario, likely in 2016, Shell will establish LNG fueling there, also taking advantage of established Shell Flying J truck stops. “We’re strong in Ontario and will be looking to leverage the heavy freight routes,” Grossman says, naming Highway 401 connecting Windsor (Detroit), Toronto, and the Quebec border.
Shell claims nearly 50 years of expertise in LNG, and says it “has long been at the forefront of transport fuel innovation.
Just Another Product
“In North America the abundance of natural gas makes LNG a cost competitive, complementary fuel to growing or undersupplied diesel markets,” the company says.
“We see this as another fuel,” Grossman says.
Because there is no rack price for LNG, the LNG sold at at the new Calgary station will be pegged at the OPIS diesel price less a fixed percentage, Grossman says.
“Just as in the diesel market, contracted customers can get larger discounts based on larger volume commitments,” Shell says.
“We want to try to replicate the diesel experience,” Grossman told F&F.
Shell LNG Tractors Someday Too
Alberta-based Bison Transport, with 15 LNG Peterbilts, is Shell’s first named customer at Calgary (F&F, November 5 and February 26). According to Grossman, other large fleets have signed contracts too.
As for Shell’s own trucks? “We want to practice what we preach,” he says. When Jumping Pound comes on line and Shell has its own LNG product, “We see moving LNG with LNG trucks as a strong fit going forward.”
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Source: Shell Canada with Fleets & Fuels follow-up