by Kathrine Moore
Ferus started out in 2001 serving the oil & gas industry facilitating increased production, decreased costs and reduced environmental impact by providing CO2 and N2 to oil & gas companies for use in their completions operations. Today, the Ferus Group of Companies produces liquid carbon dioxide (CO2), liquid nitrogen (N2), liquid natural gas (LNG) and compressed natural gas (CNG) to numerous industries in North America including oil & gas, mining, transportation and distributed power. Ferus has Canadian and US offices with several facilities in both countries.
Travis Balaski, Vice President for Ferus Natural Gas Fuels (Ferus NGF), spoke to Resource World about how the company is providing remote mining projects with LNG, a more cost efficient and environmentally friendlier alternative to diesel conventionally used at remote projects to fuel mobile equipment and to heat and power camps and operations.
Balaski describes the process by which Ferus NGF supplies resource projects with LNG. “What we do is liquefy gas where we can get access to it and then we transport that gas to an end user market that would traditionally burn diesel.” The LNG plants are built along the natural gas pipeline.
“We try to build LNG plants as proximal as we can,” said Balaski. This ensures the cost for the mine is the lowest it can possibly be as distance between the facility and the mine is as short as it can be. “As you get further north in Canada, those supply chains extend quite a bit. In western Canada we get the gas in northern Alberta and in northern British Columbia. As you move east, the pipeline network stays pretty close to the US border. You put an LNG plant as far north as you can and then you liquefy gas there,” said Balaski. The fuel is then transported to remote sites by truck, rail and marine vessel though, in Canada, it is mostly transported by truck.
Natural gas is liquefied in order to efficiently transport it. When liquefied, natural gas is 1/600 of the volume which reduces transportation costs substantially. The vessels that LNG is transported in are double walled; they are basically big thermoses that keep the natural gas cold and in liquid form. LNG is stored at -162 degrees Celsius.
The mine receiving the trucked in LNG will need an LNG storage facility and a gasification system that turns the LNG back into low pressure gas. Balaski said that a mine can use heat generated by the mine to heat up the gas which can be then used in engines and generators. Some mines would opt to own and operate that infrastructure, other mines are looking for companies like Ferus NGF to own and operate that equipment. Ferus NGF is open to either type of structure.
Ferus NGF has a memorandum of understanding (MOU) with the Selwyn and Casino projects in Yukon. They are also in discussions with management at other mining companies in the Yukon. Balaski said, “When they make their final investment decision to build their mine that will trigger our building an LNG plant in northern BC just outside of Fort Nelson which is where there is the closest gas (pipeline) we can find.” Ferus NGF is working with the local community and the local First Nations to find the right location for the plant.
Ferus NGF is in a RFP (request for proposal) process with a number of other Canadian companies.
As for permitting of the LNG plant, Balaski explained, “Domestic LNG plants don’t trigger any of the major environmental assessments in BC or in Canada for that matter. These go through a typical permitting process provincially, like with the Oil and Gas Commission in BC.
Regarding the economics of using LNG, Balaski said, “When you go to build a natural gas power plant versus a diesel power plant there will be a slight increase in the capital cost. But natural gas versus diesel can be as much as 50% cheaper. There can be quite quick payback of that capital cost. For some of the mines we have been talking to, that payback can be as short as one or two years.”
There will be some challenges in some regions of Canada when it comes to access to LNG supply as sites currently need to be year round road accessible to receive LNG. “But Ferus NGF is an innovative company that is going to find ways to make sure as many users as possible can benefit from LNG,” said Balaski. “I believe LNG will play a big part in remote mines in the future.”