Shell is partnering with Westport Innovations to promote LNG vehicles and fuels in North America. The companies are launching a co-marketing program in North America aimed at providing customers a better economic case when purchasing and operating liquefied natural gas-powered vehicles.
Under the terms of the agreement, the companies will deliver an integrated commercial solution to participating customers, initially in North America. The companies also will collaborate to develop industry standards for LNG as a new transportation fuel.
Shell also plans to have LNG available for heavy-duty fleet customers beginning in 2012 at select Shell Flying J truckstops in Alberta, Canada.
Shell is pursuing engineering and regulatory permits to produce LNG by 2013 at its Jumping Pound gas processing facility in the foothills of Alberta. Pending regulatory approval, it will be the first investment of its kind for Shell globally and will include production facilities and downstream infrastructure. Until then, LNG will be supplied to the Shell Flying J truckstops from third-party supply agreements.
The Canadian paper The Globe and Mail reported that truckers in Alberta are skeptical about the payback of using natural gas. Unlike Quebec, which offers a tax writeoff for LNG vehicles, there are no such tax benefits in Alberta.
Don Wilson, executive director of the Alberta Motor Transport Association, told the paper that LNG technology is "kind of neat but I think I'd be staying with the old diesel for a little while." Among the association's membership, Wilson has heard from no one "that says they're even in to trying it at this point."
Shell is also actively developing new business opportunities with original equipment manufacturers to substitute LNG for diesel and propane in a number of industrial sectors such as marine, over-the-road trucking, rail, mining and oil and gas drilling applications.