CNG Interests for the Chop at TransCanada

Rush to sell off marine transport patents and other associated assets

TransCanada and its US shipping partner OSG are bowing out of the marine compressed natural gas (CNG) race.

The partners no longer appear to be contenders for Colombian oil and gas producer Pacific Rubiales’ ongoing plans to use CNG rather than LNG to export gas reserves to Caribbean and Central American neighbours.

Observers said that either they chose to withdraw from the business or did not advance in the bidding line-up.

“I don’t know if it was the chicken or the egg but there are an awful lot of cracked shells around,” one commented.

Calgary-based TransCanada is understood to be touting its CNG transport system and associated interests for sale.

These include the company’s licence to build its patented composite reinforced pressure vessel for marine use.

“We are not interested in joint ventures, partnerships or other proposals that would see TransCanada retaining any ownership interest in the CNG business,” the company said in documents circulating widely in the industry.

It is inviting expressions of interest by 13 October and has set itself an ambitious deadline of 17 December for closing a sale.

Spokesperson Cecily Dobson said: “TransCanada has determined that CNG is a non-core asset for the organisation and has made the decision to exit the business.”

The assets may appeal to one of the majors or other companies planning a CNG project but who have yet to ally themselves with any of the competing technologies already on the market, industry observers commented.

End of a long road to nowhere

TransCanada was one of five to six serious developers that have been battling to get the first CNG project off the ground for almost a decade.

At one point last year the partners, which had been working under their joint venture TransCNG International (TCI), got as far as short-listing yards for a Vietnamese CNG scheme. Prior to this they had been working closely on a project to ship gas from Tanzania to Kenya.

Sources pointed to OSG’s recent decision to restructure and focus on three core segments — crude oil, products and US flag interests — as being partly to blame for the divestment.

As for TransCanada, they said the company recently appointed a new chief executive, Russ Girling, who is more focused on finance than his predecessor Hal Kvisle, who had a strong technical background.