Caterpillar Bullish on LNG Mine Trucks

November 18, 2015 in Dual Fuel, LNG, Mining by Rich Piellisch  |  No Comments

‘Technology Is Still Viable Even at Today’s Fuel Price Spreads’

In introducing the company’s new dual-fuel LNG powered mine haul truck at this year’s HHP Summit, Caterpillar’s Jeff Castleman, large mining truck new product introduction and strategy manager, provided a positive perspective on cost savings that can be expected, even with today’s low price of diesel fuel.

Left- and right-side views of a Caterpillar mine truck with LNG-diesel dual fuel DGB/Dynamic Gas Blending

Left- and right-side views of a Caterpillar mine truck with LNG-diesel dual fuel DGB/Dynamic Gas Blending

“This technology is still viable even at today’s fuel price spreads,” Castleman stated. He said in Dallas that per-truck savings between $1.6 million to $4.0 million can be expected over a ten-year period after the incremental truck cost is paid back.

Caterpillar’s analysis assumes a 30% spread between the price of diesel and LNG, and at a substitution rate of just 50%. Fuel infrastructure costs are not included outside of the 30% fuel price spread.

Tests in Tucson

“A 10% reduction in cost per hour is a game-changer for mining customers as they are out there looking for 1% to 2% savings [in their operations],” Castleman said. He showed a video of a test unit operating at the Caterpillar Proving Grounds in Tucson, Ariz.

A Caterpillar mine truck

A Caterpillar mine truck

As was a consistent theme from the start through the end of the HHP Summit, Castleman noted that infrastructure and partnerships will be critical for their customers to be successful in making the transition to natural gas. Once they make the transition, however, the customers are in a better position and more competitive in terms of a lower operating cost than others in their sector, but also in terms of commodity risk exposure.

Needed: ‘Total Partnership’

Also at the Summit, Caterpillar announced plans for mine trucks with its Dynamic Gas Blending equipment for LNG-diesel dual fuel operation (HHP Insight, October 28). The DGB hardware is to be available for new trucks, and for retrofits.

Castleman spounded a note of caution too: LNG fuel for mine vehicles, he said, “requires total partnership with mining customers and LNG fuel suppliers to make the total solution successful.”

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Source: HHP Insight at HHP Summit 2015 in Dallas

 

 

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