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GNA - LNG Opportunities for Marine and Rail

25-Nov-2014

Author:  Gladstein, Neandross & Associates (GNA),

Prepared for: ANGA

Page Count: 125

Summary:

The information contained in this report was prepared on behalf of America’s Natural Gas Alliance (ANGA) by the consulting firm, Gladstein, Neandross & Associates (GNA). The opinions expressed herein are those of the authors and do not necessarily reflect the policies and views of ANGA or its member companies. Reference herein to any specific commercial products, process, or service by trade name, trademark, manufacturer, or otherwise, does not necessarily constitute or imply its endorsement, recommendation, or favoring by ANGA or GNA.

From the Document:

The availability and abundance of clean, low cost, North American shale gas is prompting a comprehensive reevaluation of transportation fuel operations across the nation. In the on-highway marketplace, companies like UPS, Frito Lay, Ryder, Waste Management and many others are making large-scale investments in natural gas vehicles across their nationwide fleet. Off-highway high-horsepower industries are rapidly catching up, with marine vessel operations and locomotives offering two of the highest potential near-term growth opportunities. High horsepower natural gas users can significantly reduce fuel costs, improve environmental performance, increase the use of domestically produced fuels, and comply with air quality regulations.


This report examines the intersections between marine and rail operations to identify liquefied natural gas (LNG) growth opportunities in three geographic regions: the Great Lakes, inland waterways along the Mississippi River and its major tributaries, and the Gulf of Mexico. This study finds that the total potential demand across all three regions could reach 1 billion gallons annually by 2029, which equates to approximately seven times current LNG fuel use for transportation in the United States (U.S.). This large-scale transition to natural gas would allow users to collectively realize $575 million in annual fuel cost savings.1


Although LNG offers attractive cost and environmental benefits for end users, challenges with the availability of emerging technologies, regulatory uncertainty, end user familiarity, and fuel supply and distribution questions have contributed to slow initial adoption in the North American marketplace. Any largescale operational shift to a new fuel will present a range of interconnected challenges, and so this report aims to identify opportunities for fueling collaboration and strategies to overcome any local implementation barriers related to policy, technical or other market factors. This effort will thereby help reduce market entry barriers for infrastructure developers and end users to facilitate more extensive LNG adoption.