Igniting Demand

Abundant, safe, and clean, natural gas has the potential to be the next major fuel source in North America, so Ferus is partnering with others to increase the commodity’s prevalence

“The benefit of using [liquefied natural gas] is there. The greenhouse gas and cost savings are compelling factors on why you’d want to make the conversion to natural gas.” —Alan Mann, VP & Controller
“The benefit of using [liquefied natural gas] is there. The greenhouse gas and cost savings are compelling factors on why you’d want to make the conversion to natural gas.” —Alan Mann, VP & Controller
Alan Mann recently joined Ferus Inc. as vice president and controller at a time when the company was moving toward the next big innovation in the energy field: the creation of an affordable, available supply of liquefied and compressed natural gas (LNG and CNG, respectively) for high-horsepower use. The company has been excited about the advancement for some time, but getting others onboard has been another matter entirely. “The benefit of using LNG is there,” Mann says. “The greenhouse gas and cost savings are compelling factors on why you’d want to make the conversion to natural gas. The challenge is getting the infrastructure in place to make the investment viable for the users and the investors.”

Basically, because there’s not already a readily available supply of LNG across entire areas of operation, trucking and rail companies have been hesitant to convert their equipment to it, and the companies who could put up capital for the production and supply infrastructure have been hesitant to invest without an already existing demand. Thus, despite the fact that natural gas offers a savings of 20–40 percent over diesel fuel and lessens its user’s carbon footprint by 30 percent, the market for it remains relatively untapped. “It’s one of those opportunities that requires a long-term investment and pays long-term benefits,” Mann says.

Ferus has a plan to overcome hesitancy on both the user and supply side, though, in order to make the natural gas industry the new major fuel source in North America. At the simplest level, “in order to succeed, it’s critical to have the strategic partnerships,” Mann says.

FACTS & FIGURES

100,000
Amount of US gallons of liquefied natural gas that Ferus’s new Canadian facilities will produce each day

$50+ million
Capital commitment for the projects

5
Number of mobile fuel stations that ENN Canada plans to open in Northwest Canada

8
Cryogenic facilities that Ferus has in operation or under construction

175+
Transportation and storage assets Ferus has that are specifically designed for oil field operations

To this end, the company has entered into two major agreements to jointly deliver LNG solutions. It recently partnered with ENN Canada to build two LNG plants in Vancouver and Edmonton that will service the on-road trucking market as well as other high-horsepower industries such as marine transport, rail, mining, and oil and gas exploration. Additionally, it’s working with Clean Energy Fuels and GE in a consortium known as Eagle LNG Partners to deliver LNG across the United States. The companies are betting that the increased supply of natural gas at points of use will serve as the tipping point for users to convert their equipment to take advantage of the more affordable, abundant energy source.

“I hear from our market-development team that they’re amazed at the change from a year ago,” says Blair Lancaster, Ferus’s director of external relations. “Last year, they would have to explain to potential customers what LNG is. Now, when we are commissioning our first plant, we already have more demand than supply.”

Indeed, the demand for the cleaner-burning, less-expensive fuel in industries such as long-haul trucking, rail, mining, marine transport, and oil and gas is projected to grow substantially as companies such as GE, Westport, and others continue to make significant advances in engine technology. “Furthermore,” Mann says, “LNG is a safer fuel than diesel. It is not flammable as a liquid and dissipates into the atmosphere if leaked or spilled.”

Safer, more affordable, and with greater reserves in North America, natural gas is poised to change the energy landscape, and Ferus is simply skating to where the puck is going to land.

“We have a very committed and engaged leadership team, which is critical to the success of the organization,” Mann says, and he looks forward to making an impact as a member of the business. “Given the relatively small size of the company in relation to its partners, to be able to make change and be part of the success is very exciting.”