On the Gulf Coast, Charif Souki, CEO of Cheniere Energy Partners LP, builds LNG megaprojects to fuel the world. In New England, Jonathan Carroll of Gulf Oil LP builds an LNG plant to fuel his truck.
Make that trucks. Gulf operates a fleet of almost 200 in the Northeast. In 2012, seeking ways to cut both costs and emissions in this operation, the legendary oil company turned its attention to LNG.
“It was this fleet that got us involved with LNG in the first place,” Carroll, senior director of market and business development, natural gas, told attendees of Hart Energy’s recent World LNG Fuels Conference & Exhibition in Houston. “It is still the cleanest-burning fossil fuel. It is still a domestic and abundant resource, stable over the long term.”
Gulf, based in Framingham, Mass., is a major retail player, distributing around 3 billion gallons (gal) of fuel per year through 2,000 branded stations and 1,000 private label outlets in 27 states. It has incorporated 44 Peterbilt Model 386 LNG-fueled tractortrailers into its New England fleet, supported by three LNG fueling stations and four cryogenic support trailers.
How committed is Gulf to LNG as a transportation fuel? In 2017, the company expects to start operations of its 100,000-gal-per-day liquefaction plant in the northeast Pennsylvania town of Great Bend, just over the New York state line and a mere 20 minutes south of Binghamton, N.Y.
“So how’s the fleet doing? Last year, we traveled over 5 million miles—this is just the LNG fleet,” he said. “We were able to displace over 1 million gallons of diesel and an estimated 2,800 metric tons of carbon dioxide. We saved about $1.8 million in our fuel costs, and we’re eligible for a federal tax credit of over $800,000.”
Projects like this tend to engender opportunities, and Gulf moved to exploit them. Its operations personnel soon began sharing expertise on LNG handling and storage with local firefighters, regulatory inspectors and curious owners of fleets in the area. The company opened dialogues with engine manufacturers to discuss ways to improve equipment.
Relationships established with regional suppliers led to hauling contracts. In 2014, Gulf moved more than 3.6 million gal for customers. Finally, it made sense to take the next step.
“Our primary motivation was to improve the reliability of the LNG supplied for our fleet,” he said. “Up in New England, we’re surrounded by LNG tanks. There is over 16 Bcf [billion cubic feet] of LNG storage in the region, but really none of it is available for longterm firm purchase. The facilities that do make it available are oftentimes interruptible. We wanted to be in control of our own destiny and take advantage of our close proximity to the Marcellus Shale region.”
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