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UPS signs LNG supply deal

LNG Industry,

Pivotal LNG, a wholly owned subsidiary of AGL Resources has entered into an agreement with United Parcel Service Inc. to provide LNG for UPS fleet operations in Nashville and Knoxville, Tennessee.

“We are pleased to enter into this agreement with UPS. One of the benefits we are able to offer our customers is continuity of LNG supply because of our access to multiple supply locations within the region,” said Steve Cittadine, President, Storage and Fuels for AGL Resources.

UPS is expanding its use of LNG as a transportation fuel by replacing many of the diesel tractors that are based in the Knoxville and Nashville UPS terminals with LNG fueled tractors.

“These tractors will operate on high mile routes in Tennessee and surrounding states,” said Mike Casteel, director of fleet procurement for UPS. He added, “AGLResourcesis providing an economical and secure source of fuel, allowing us to justify the incremental capital investment in LNG infrastructure and vehicles.”

The 10-year contract calls for Pivotal LNG to provide UPS with an average of 500,000 gallons of LNG per month for its fueling stations, which UPS will own and operate.

Given the wide and expected sustained price differential between natural gas and petroleum-based fuels, LNg could be an attractive alternative fuel for large fleet operations.

Adapted from press release by Peter Farrell.

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