LNG about to reach U.S. power producers by rail

Monday, 02 March 2020
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Rail tankers will soon transport LNG to power generators across the United States, as the regulator seeks to advance the use of this cleaner-burning fuel in decentralized location like the Midwest. Trucks and ships are currently the only means of transport for liquefied natural gas.

Eager to get cheap domestic shale gas transported to decentralized power producers, the U.S. Department of Transportation is pushing to establish regulations for shipping the LNG by rail. If adopted, the move could boost the market for ISO container exports from ports not already served by the coast-based LNG production expansion.

President Donald Trump has thrown his political weight behind the ‘LNG on Rail’ initiative by issuing an executive order earlier this year to speed up the opening of the railroad network to LNG rail tankers. With this move, Trump recognized the continued rise in cheap domestic shale gas production in the U.S. which is high in demand both at home and abroad.

In Europe, Chart Industries together with Germany-based VTG has already built the first LNG tank car (pictured) – the units keep the natural gas in a liquefied state and can be leased or purchased.

Trains compete with pipelines

Observers noted that LNG transportation by rail could be a “viable alternative to pipelines,” which are not always able to meet the demand of, or reach, certain areas in the United States that are accessible by rail.

LNG can currently only be transported via rail in a portable tank with a special approval from the U.S. Federal Railroad Administration (FRA) but the Transport Department has singled out rail transport as a “safe, reliable, and durable mode of transportation” for LNG.

Other potential benefits of transporting LNG by rail include the high safety levels inherent to rail transport and the use of approved tank cars, fuel efficiency, fuel accessibility to remote regions, increased US energy competitiveness, and fewer emissions, said the Department’s Pipeline and Hazardous Materials Safety Administration (PHMSA).

“Safety is the Department’s number one priority and during the comment period,” it stressed and the agency noted it will continue to collect and analyze data on rail cars, ensuring that any rulemaking will utilize the latest data in establishing safety standards. 

 

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