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Shell Canada, Caterpillar Sign LNG Engine Testing Agreement

In an effort to reduce operating costs and emissions from oilsands mining in northern Alberta, a subsidiary of Royal Dutch Shell plc has signed an agreement with Caterpillar Inc. to test a new engine and fuel mix using liquefied natural gas (LNG).

Peoria, IL-based Caterpillar is working on the design and construction of a fully integrated, dual-fueled mining truck, with LNG displacing most of the engine's diesel power. Under the terms of the agreement, Caterpillar will test the mining truck at Shell Canada Ltd.'s operations near Fort McMurray, AB.

The agreement also calls for Shell Canada to retrofit existing trucks from its fleet with the new engine for trial, and provide the necessary infrastructure for fueling at Albian Sands, part of the Athabasca Oil Sands Project, or AOSP (see Shale Daily, Aug. 22, 2012). AOSP is a joint venture (JV) of Shell Canada (60%), and the Canadian subsidiaries of Marathon Oil Corp. (20%) and Chevron Corp. (20%).

Shell Canada said the testing by Caterpillar "follows a trend for Shell in looking at options to use Canada's abundant natural gas as a fuel in marine and road transportation, and other industrial situations."

“With heavy hauling being such a core part of our operation, success with this could make a real difference in our operations costs and emissions,” said Shell’s John Rhind, vice president for oilsands operations.

Field testing of the dual-fuel powered mining trucks is expected to begin in 2016. The trial is expected to last up to one year.

"Many of our customers are asking for natural gas-powered equipment in order to reap the financial and environmental benefits," said Chris Curfman, Caterpillar vice president for mining sales and support. "This agreement further builds upon our efforts in delivering cost-effective, reliable and innovative solutions to our customers."

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