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Gas provider inks delivery deals with mining companies

Certarus seeks to displace propane for underground mine heating and power generation
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A compressed natural gas (CNG) distributor that’s setting up shop in the Timmins area has already signed contracts with three mining operations in northeastern Ontario.

Calgary-based Certarus announced in early October that it was establishing a regional hub near Timmins with plans to develop another in Red Rock in northwestern Ontario to cater to mining and forestry clients. More than 40 jobs will be created across the region.

Stéphane Gallant, the company’s business developer manager, said they haved signed contracts to haul compressed natural gas by truck to Kirkland Lake Gold’s Taylor Mine near Matheson, to Imerys’ Penhorwood Talc Mine near Gogama, and to an undisclosed third mining client.

Northern Ontario is part of the Western Canadian company’s expansion strategy into eastern Canada and the southwestern U.S.

The company delivers CNG to industries without access to a natural gas pipeline.

In competing against propane and diesel suppliers, Certarus is promoting itself as a virtual pipeline provider of a cleaner and affordable fuel for mainly industrial players that consume large volumes of gas.

Gallant said the potential customers they’re targeting operate mines and mineral processing mills, kilns and dryers, asphalt plants, and large greenhouse operations, especially in southern Ontario where they’re searching for a third location.

Certarus taps into the pipelines of their natural gas company partners and compresses the gas to 4,000 psi before trucking it to a mine or mill site where it’s decompressed for use in power generation and air heating for underground mines.

The company plans to scale up to 25 jobs in Timmins and 16 in Red Rock, with the potential for more seasonal jobs during the winter peak periods between October and April.

Gallant said they’ve worked closely with Union Gas in identifying prime areas to locate in the North. Their strategy is to establish regional hubs eight hours apart so as to blanket the province from three locations.

Each hub will be staffed with an operations manager, technicians and truck drivers.

Their business model case is based on volume and frequency for customers who burn a minimum propane-equivalent of 3,000 litres a day.

Gallant said a major mine operation can burn more than 20 million propane-equivalent litres annually, necessitating the need for eight to nine hauls a day.

“We back up the trailer at client’s site and leave it there. We’re expecting our clients to burn through it in one to four days.”

Each trailer contains four cylinders (40 inches in diameter and 40 feet long) inside c-can shipping container carrying 365 gigajoules of energy, which contains the equivalent of 14,000 litres of propane.

At Kirkland Lake Gold’s Taylor Mine, Gallant said they’ll be supplying two natural gas generators.

The mine is grid-connected but is supplementing its needs with its own generation and to peak shave (techniques used to reduce daily power consumption) during the summer months. The miner is also setting up a raise bore drill on the property, so they’ll be feeding that as well.

Gallant said once they’ve established a drop point at Taylor Mine, they hope to showcase their capabilities to prospective clients.

With Imerys, the French company uses natural gas to dry their talc powder, consuming as much as 15,000 litres of propane a day.

Gallant is a familiar face in the Timmins area, having worked for that city’s economic development department until he was recruited by Certarus last spring and began work in May.

“For the first four months, I was the only guy. If they needed somebody to move trailers or unload trucks I was the guy.”

He’s since hired three people for Timmins. Gallant has an extensive contact list and is bilingual, which comes in handy in making inroads in western Québec.

Timmins is Certarus’ first Ontario presence, situated within a four-hour drive of 39 operating mines in Ontario and Québec.

While currently operating out of temporary digs, the company is moving in early 2019 to a permanent 32-acre home on Highway 101 location, 30 kilometres east of Timmins, near the Frederick River Bridge.

Union Gas has constructed a 1.3-kilometre gas line from its valve nest on Connaught Road to the Certarus site.

The company’s location will contain a 10,000-square-foot shop with truck wash and maintenance bays, office space, a compressor, and four fill stations for trucks. If demand warrants, the facility could run 24-hours-a-day.

They’ll have their own truck fleet but are also farming out work to a haulage firm from Hearst. Gallant said it’s easier to scale up operations that way, and it allows them to invest their capital in the trailers.

For the Red Rock location, they’ve selected a vacant lot just off the Trans-Canada Highway that's already zoned for compressed natural gas. The community has plenty of unused capacity from its days when the linerboard mill was running.

Gallant is keeping close tabs on what new mines are coming into production in the northwest, but added they will not start shop construction until a significant contract is secured.

They’re also interested in municipal clients, through projects like district heating plans, if the volume is there. Gallant said they have zero interest in individual home and cottage delivery.

During the 2016 Fort McMurray wild fire, Certarus provided disaster relief by feeding the backup generator to the local hospital after the city’s gas line was shut off.

They also work with natural gas companies in delivering to clients and communities on occasions when service is temporarily interrupted for a few days.




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