A unit of General Electric and natural gas vehicle (NGV) fuel supplier Clean Energy Fuels Corp. said Tuesday they will partner on the development of two liquefied natural gas (LNG) production/storage facilities to help fuel Clean Energy’s proposed national network for fueling long-haul trucking fleets with LNG.

GE Oil & Gas (GEO&G) and Clean Energy plan to build two liquefaction facilities, one in the upper Midwest and another in the Northeast, to serve growing LNG fueling stations in those regions. Applying GE’s “MicroLNG” technology, the facilities are expected to be operational by 2015, said Mike Hosford, GEO&E’s general manager for unconventional resources.

The first two LNG production facilities, each ultimately with 1 million-gallon/day (gal/d) capacity, are expected to lead to the development of others by the partners. Hosford said there could be as many as 10 facilities developed around the nation. Seal Beach, CA-based Clean Energy currently operates two smaller production facilities in Texas and California, and it has agreements with more than a dozen other LNG producers scattered around the country.

Clean Energy CEO Andrew Littlefair said GE’s involvement provides “significant confirmation” that natural gas is here to stay as a transportation fuel. The long-haul trucking market for which LNG is specifically targeted is a 30 billion gallon annual market, according to Littlefair, who said in comparison the airport shuttle and public transit markets are 2 billion gal/year.

“GE recognizes that natural gas for transportation is a huge opportunity,” Littlefair said. “As we look out at the market in the next several years, we are going to need billions of gallons of LNG.”

Littlefair said Clean Energy will meet its goal of having more than 70 LNG fueling stations in place by the end of this year and ultimately 150 stations as part of its “America’s Natural Gas Highway” (see Daily GPI, Aug. 25, 2011).

Hosford called the partnership with Clean Energy a key to developing a transportation infrastructure in the United States tied to natural gas. He said the nation is at a “tipping point” with the growing abundance of gas domestically.

Clean Energy has been an early adopter in developing the NGV infrastructure, Hosford said, and GE has a long history in LNG, with involvement in nearly every liquefaction plant now operating worldwide. Earlier this year it announced a partnership with Chesapeake Energy to develop home refueling equipment (see Daily GPI, March 8).

GEO&G’s technology provides modular units designed to rapidly liquefy gas while minimizing a site’s physical footprint. Littlefair said GE will now review potential locations for the initial two facilities with the focus on the Midwest and Northeast.

The GE-designed facilities are good for covering a 250-mile radius of fueling stations using cryogenic tanker trucks, Littlefair said. “It is moved very much the way you would gasoline or diesel,” he said. “Ideally, you don’t want to haul LNG more than 250 miles; it is most economic in that range.”

If the market for long-haul trucking fleets grows as Clean Energy expects, some 5-6 million gal/d of fuel will be needed, requiring dozens of fuel production plants, Littlefair said. “We’ll use this same template to build many plants, and others will build them as well.”

Clean Energy’s current production plants in Texas and California have three trains each producing 80,000 gallons/train, or 240,000 gal/plant, Hosford said. “What we are looking at is a single refrigerant, methane-based system going up in scale to have a capacity of up to one million gal/d,” he said.

Clean Energy paid about $80 million for its current plants and the GE-designed facilities will cost about $115-120 million each, including much larger storage capacity.

“A lot of the added cost is in the cryogenic storage,” Hosford said.

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