Can’t Get Natural Gas at Your Plant? Now There is a Way.
By Mark S. Kuhar
|Aerial view of compressor station.|
Many plants in the nonmetallic minerals industry would benefit from access to natural gas. But if your plant is located in a very rural part of the country or is located on geographically challenging terrain, you might still be burning heavy fuel oils, coal or even tires.
You are responsible for the plant and the surrounding community. Your plant must remain competitive, comply with ever stricter EPA air emissions regulations, and do its part to meet corporate “green goals.” Since you are very good at what you do, you can probably adjust your boiler/kiln/etc., to pass a CO2 test or fine-tune it to pass a NOx or a particulate test, but not all at the same time. This situation can cause a great deal of pressure for management.
If your plant is not yet on a gas pipeline, you may think that your only “fix” is paying millions of dollars per mile for a pipeline extension. The money is one thing but the environmental requirements, environmental activists, delays and bad press caused by a right-a-way purchase or eminent domain threat are just as bad.
How do you find a solution for your plant? There is a new option called the virtual pipeline. At least 50 large plants in the United States are currently receiving trucked natural gas from a virtual pipeline.
What is a Virtual Pipeline?
A virtual pipeline is a fleet of tractor-trailers that delivers the same gas that traditionally comes from a pipeline. Virtual pipeline providers keep their trucks rolling so that the facility is provided with gas 24/7.
The service does not require the plant to build storage as the gas is drawn out of the trailers directly into the powerhouse at whatever temperature and pressure is required. With between two and 20, 40-ft. trailers unloading CNG all day long, the experience is like being on a traditional gas pipeline.
A virtual pipeline can expand with you at no cost. The virtual pipeline service provider who had been delivering eight loads a day for your process heat can up that to 12 loads a day after the expansion. No new capital requirement.
|A NG Advantage delivery truck.|
How Does it Work?
“How exactly does this work? It’s really a 12-month process,” said Tom Evslin, co-founder and chairman of NG Advantage, a company that that uses its “virtual pipeline” of tractor-trailers to deliver North American natural gas to industrial customers that are not served by a regular gas pipeline. “A potential customer would typically contact us and we would discuss with them what their needs are and if their potential energy usage makes them a good candidate for a virtual pipeline. Based on what type of fuel they are currently using, we would then decide whether new burners or other adjustments would have to be made. That usually takes about six months.
“You work with your engineering team to convert the boilers, kilns, dryers, etc., to being dual-fuel,” Evslin said. “You can do it in stages if you like. The primary fuel source will be CNG and the backup may be fuel oil. The backup is needed when the virtual pipeline provider is curtailed at the transmission line, but the need for backup fuel would also exist if you were physically connected via a distribution line to the same transmission line that curtailed the virtual pipeline provider. Back up fuel is not bad, however, as it represents a good insurance policy in today’s erratic energy pricing world. Who knows when gas will be cheaper than fuel oil or vice versa? The service provider may occasionally have a problem with your delivery because of inclement weather or perhaps an automobile accident causing a delay. In this very infrequent scenario, the provider’s Operations Team will contact your operations people to discuss slowing down your operation or switching briefly to your backup fuel. This does not happen often and in fact, it is usually the plant asking the virtual pipeline provider to slow down fuel deliveries due to equipment maintenance or malfunction or bad weather.”
According to Evslin, each truck has a meter on it. It is not like buying a truckload of propane or a truckload of coal. The plant only pays for what it uses and that is measured by the meter.
Evslin said they are finding a lot of acceptance for this type of set-up from kiln operators. “The reason is that natural gas burns so much more cleanly than coal or oil that the frequency of shutting down the kiln to clean it goes way down. One customer I know of went from a yearly shutdown to an 18-month shutdown for maintenance. They just don’t have to do it as often.”
While the equipment outside the plant is being converted, the virtual pipeline company is building a compressor station on the closest interstate transmission gas line, building decompression and heating equipment outside your powerhouse, ordering new trailers and hiring drivers. Most of the work outside your walls is paid for by the virtual pipeline company.
|Trucks at a customer site.|
Besides the conversion, the main costs are opex expenses. You can purchase the commodity yourself or the virtual pipeline provider can purchase it for you. You pay them for transportation to your facility as you would pay a pipeline for transport. The price is determined by many factors, but the most important factors are your distance from the proposed compression station, the length of contract with the virtual pipeline service provider and the volume of gas purchased.
“It is pretty simple,” Evslin said. “Connecting your facility to a natural gas virtual pipeline has many advantages. It is cheaper than paying for a pipeline extension, it requires much less maintenance than complex scrubbing equipment, and now that your facility is dual-fuel, it can act as a temporary solution while you wait for the pipeline, should it ever arrive. Additionally, natural gas is a much safer and environmentally friendly fossil fuel, and it can satisfy ever more stringent clean air regulations.”
Using a clean fuel produced in North America has the positive effect of reducing dependence on foreign oil, and historically it has shown significant cost savings relative to other fossil fuels. Natural gas can now be the solution to a variety of problems facing plants in the mineral industry that use dirty and expensive fuels.