VANCOUVER, July 28 Fortis Inc is
pushing ahead with a C$400 million ($370.4 million) expansion of
its Tilbury liquefied natural gas (LNG) plant in British
Columbia, as the gas distributor looks to meet growing domestic
demand for the super-chilled fuel.
Bechtel Canada has been chosen to lead the project, which
will add 1.1 million gigajoules of storage capacity at the
Vancouver-area facility and boost liquefaction capacity by
34,000 gigajoules per day, Fortis said on Monday.
The plant was originally designed to store natural gas for
periods of peak household demand. The expansion will allow it to
meet burgeoning demand for LNG from the transportation sector,
particularly from long-haul trucking companies.
Natural gas, abundant in North America, is increasingly
being touted as a cheaper and greener alternative to diesel for
everything from garbage trucks to long-haul tractor trailers and
Numerous trucking companies have moved to convert portions
of their fleets to LNG, but broader adoption has fallen short of
initial expectations. Challenges remain around fueling
infrastructure and high operating costs.
While Fortis is increasing spending on its domestic LNG
plant, Royal Dutch Shell recently scrapped a
small-scale liquefaction unit it was building near Calgary,
citing slower-than-expected demand growth in the transport
Shell has also paused work on two other North American
liquefaction plants, located near marine shipping corridors, but
said those projects may resume due to better opportunities for
LNG-powered marine vessels.
Fortis said it has signed LNG service deals with various
transportation firms and also provides LNG to remote northern
communities that use it as an alternative to diesel.
The St. Johns, Newfoundland-based company is also eyeing
opportunities in British Columbia's busy mining sector, along
with emerging technologies like LNG-powered trains.
Construction on the Tilbury expansion project is expected to
start in September, with work wrapping up in 2016.
($1 = 1.0798 Canadian Dollars)
(Reporting by Julie Gordon; Editing by David Gregorio)