Alternative fuel company DNG Energy’s petroleum division and energy company Masana Petroleum Solutions will test the feasibility of making liquefied natural gas (LNG) available to South Africa’s transport industry.
The partnership comes as the world is seeking cheaper alternatives to traditional sources of fuel that pollute the world.
The success of the pilot study will open up possibilities for a cleaner fuel to be available on a larger scale in South Africa to decarbonise the commercial and industrial industries.
The pilot study will begin in the last quarter of this year, with at least one of Masana Petroleum’s customers to participate. The study will run for up to six months.
DNG will be responsible for supplying the required volumes of LNG, installing the necessary cryogenic equipment – which keeps natural gas in liquid form chilled at appropriate level of -162 ˚C for delivery, as well as the dispensing of LNG to the participating vehicles and providing training and support during the course of the pilot.
DNG group CEO Aldworth Mbalati says this is an exciting moment as the company moves to test the proof of concept for the transport industry, with a partner that is committed to transitioning to a cleaner future.
“LNG is a cheaper alternative to petrol and diesel, is in abundant supply and will save the various industries in terms of service costs as service intervals are longer.
“We, therefore, see no reason why LNG cannot become the fuel of choice today, especially as natural gas vehicles, including trucks and busses, are already in production, and it is proven to be less harmful to the environment.”
Masana MD Morena Sithole, in turn, is confident about the company’s deep expertise in identifying and meeting customers’ energy needs.
“The world is transitioning to a lower-carbon future, and we aim to support our customers through this transition.
“This partnership offers Masana an opportunity to learn together and identify key success factors to scale up commercial models aligned with our low carbon participation strategy.”
Global demand for LNG experienced rapid growth from near-zero levels in 1970 to a meaningful market share today, with half the demand coming from Asian and European countries.
The LNG industry is booming as the world aims to break away from traditional and polluting energy sources such as oil and coal to focus on clean energy.
“In addition to the transport diesel market, the availability of utility-scale LNG in South Africa will afford the wider industrial and commercial customers in the manufacturing, power generation, mining and agricultural segments an opportunity to reduce their cost of energy use and carbon tax.
“We look forward to the pilot and sharing the results with the market,” says Mbalati.
Management consulting firm McKinsey & Company estimates LNG demand will increase by 3.4% a year globally up to 2035.
While LNG is a regular alternative fuel in other countries, South Africa still lags behind.
This partnership by DNG and Masana will make this scenario a reality for South Africa.
Already, vehicle manufacturers are moving to gas, with many companies in South Africa like Volvo already offering LNG trucks. These manufacturers are waiting for LNG to be available on a larger scale, the companies conclude.