LNG set to become a reality for heavy vehicle transport in Tasmania

By: Chris Smith

LNG Refuellers, a consortium comprising seven Tasmanian transport operators, today announced a deal with industrial gas company BOC, for the

LNG Refuellers, a consortium comprising seven Tasmanian transport operators, today announced a deal with industrial gas company BOC, for the supply of LNG fuel for over 120 natural gas –powered heavy vehicles in Tasmania.

Announcing the deal, the Chairman of LNG Refuellers, Ken Padgett, stated the project will result in the establishment of the first commercial pipeline-to-vehicle supply for heavy vehicle transport in Australia.

"We have formed a new refuelling company that will own and operate a network of six commercial LNG (Liquefied Natural Gas) refuelling stations across Tasmania to manage the fuel logistics needs of most Tasmanian fleets on the major freight routes," Padgett says.

Padgett explains unlike oil, the plentiful supply of natural gas in Australia helps maintain a stable price making it an ideal fuel for heavy transport. Furthermore LNG releases up to 25 percent less greenhouse gases compared to diesel powered heavy vehicles.

"With rising fuel prices and the long-term security of oil supplies under question we began looking for alternate fuels. Our investigation led us to the conclusion that natural gas provides an effective overall solution from a commercial, economic and environmental perspective," he says.

"This deal represents a $150 million vote of confidence in the commercial merits of natural gas as an alternative to wholesale use of diesel fuel for road transport in Tasmania."

BOC, part of the Linde Group, are the market innovators in the design, construction and operation of Micro-LNG plants for the domestic transport market.

To secure the LNG supply BOC will build and operate a new Micro-LNG plant near Westbury, subject to securing all necessary planning and development approvals.

BOC became the first company in Australia to produce LNG when it established its Dandenong facility almost 30 years ago.

In addition BOC will design and construct the entire supply chain infrastructure for LNG Refuellers including LNG road tankers and six refuelling stations.

Alex Dronoff, BOC’s General Manager LNG, says "We are drawing on our global experience to implement a market leading solution".

"This alternate fuel is cleaner which is a win for our customers and the environment. We look forward to working with LNG Refuellers to deliver clean and efficient fuel for the Tasmanian heavy transport sector," he says.

"The LNG plant will have the capacity to produce 50-tonnes of LNG a day. That’s the equivalent of 70,000 litres of conventional diesel."

LNG Refuellers plans to provide briefings to potential customers in the Tasmanian transport industry over the next six months.

Today’s announcement represents the culmination of more than two years of work involving Tasmanian transport operators with the Tasmanian Department of Economic Development, and experts in financial management and alternative fuels.

"This project would not have been possible without the hard work of the LNGR shareholders, the provision of resources by the Tasmanian Department of Economic Development and Tourism, and a $5.05m grant provided through the Tasmanian Community Forest Agreement Industry Development Program, a joint Australian and Tasmanian government initiative," Padgett says.

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