REPORT CNG FEASIBILITY STUDY

REPORT

CNG FEASIBILITY STUDY

Presented to: Louis Genest

Director of Natural Gas Utility County of Vermilion River

4912 50 Avenue Kitscoty, AB

T0B2P0

Prepared By: Jac Neels, P.Eng. Jenmar Concepts

A Division of Jenmar Compressors Inc. #319 – 9440 202 Street

Langley, BC V1M 4A6

Submitted:

November 06, 2018

County of Vermilion River Compressed Natural Gas Feasibility Study - Phase 1

Doc. No. 99-106-005-00

Revision: A Jenmar Concepts, a division of Jenmar Compressors Inc. 319-9440 202nd Street, Langley, BC, V1M 4A6

Telephone: 604-757-9082 www.jenmarconcepts.com Page 2 of 76

Approved By: M.Epp Issued By: J.Neels

Date: 2018-11-06

DOCUMENT APPROVAL STATUS Rev. Company Name Date Signature

Prepared by A Jenmar Concepts J.Neels, P.Eng. 2018-11-01

Reviewed by A Jenmar Concepts M.Epp, P.Eng. 2018-11-06

Approved by A Jenmar Concepts M. Epp, P.Eng. 2018-11-06

REVISION HISTORY Rev. Document Status Issued By Date

A Draft issued for client review and comment J.Neels 2018-11-06


Doc. No. 99-106-005-00


Telephone: 604-757-9082 www.jenmarconcepts.com

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Date: 2018-11-06

TABLE OF CONTENTS 1.0 INTRODUCTION ................................................................................................................................. 4 2.0 STUDY DETAILS .................................................................................................................................. 4

2.1 Objective – Phase 1 ....................................................................................................................... 4 2.2 Scope ............................................................................................................................................. 4

3.0 CNG MARKET DEVELOPMENT ........................................................................................................... 5 3.1 Economic and Environmental Benefits ......................................................................................... 5 3.2 CNG Roll-Out Plan ......................................................................................................................... 5 3.3 CNG Survey ................................................................................................................................... 6

3.3.1 Vermilion Interest ................................................................................................................. 6 3.3.2 Highway 16 Users .................................................................................................................. 7 3.3.3 Other Users ........................................................................................................................... 7 3.3.4 Action Items .......................................................................................................................... 8

4.0 CNG FUELING LOCATIONS ................................................................................................................. 8 4.1 CVR Operation Facility .................................................................................................................. 8

4.1.1 Fueling Station ...................................................................................................................... 8 4.1.2 Maintenance Facility ............................................................................................................. 9

4.2 Lloydminster Municipality Works ............................................................................................... 10 4.3 CNRL Application ......................................................................................................................... 10

5.0 CONCLUSIONS ................................................................................................................................. 10 6.0 APPENDIX A – FORTIS SAMPLE AGREEMENTS ................................................................................ 11 7.0 APPENDIX B – CNG SURVEY REPLIES ............................................................................................... 30 8.0 APPENDIX C – SUMMARY TABLE SURVEY RESULTS ........................................................................ 41 9.0 APPENDIX D – ATCO GAS / SASKENERGY ........................................................................................ 44 10.0 APPENDIX E – CVR FUELING STATION SITING ASSESSMENT CHECKLIST ........................................ 47 11.0 APPENDIX F – CVR GARAGE CNG UPGRADE ASSESSMENT ............................................................. 57 12.0 APPENDIX G – CVR FUEL DEMAND ASSESSMENT ........................................................................... 72


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1.0 INTRODUCTION Jenmar Concepts (hereinafter referred to as “Jenmar”) was awarded a contract by the County of Vermilion River for a Compressor Natural Gas (CNG) scoping and feasibility study. The County of Vermilion River (“CVR”) has an abundance of natural gas derived from local oil producers and seeks to further utilize this resource for environmental and financial benefit to CVR residents. CVR has identified the potential to develop the use of natural gas for transportation fuel and has gained some pilot experience with the conversion of six bi-fuel vehicles. In order to assess the viability of investment in natural gas fueling infrastructure within the county, this study will report on a survey of CVR’s fleet and other potential users to assess the feasibility of conversion of those fleets to natural gas fuel, thereby making a determination of the potential market load. This assessment includes both the environmental and financial benefits to CVR. The study is divided into 3 phases, Phase 1 - Information Gathering Phase 2 - Preliminary Feasibility and Public Consultation Phase 3 - Feasibility Study Information gathered for phase 1 is presented in this report. Information was gathered during a visit to Vermilion River, through a CNG load survey, and through meetings with potential clients and CNG suppliers. The information was used to develop a plan for phase 2 work. The proposed work for phase 2 is also presented in the report.

2.0 STUDY DETAILS

2.1 Objective – Phase 1 Gather information on potential CNG demand by CVR fleet vehicles and from other potential users. The information will serve as the basis for phase 2 and 3 work.

2.2 Scope The work undertaken in this phase is summarised as follows:

• Information was gathered for the County vehicle fleet and potential CNG use.

• A CNG questionnaire was prepared, issued and analyzed to gauge the interest of transportation and bulk CNG users located in the proximity of Vermilion River.

• A meeting was held with two potential CNG users / retailers in the Vermilion area.

• Discussions were held with CNG fueling station owners and operators, i.e. Atco Gas and SaskEnergy. The purpose of the call was to find out if a CNG station in Vermilion River would stimulate transport companies to use CNG as transport fuel on Highway 16 corridor.

• Assessment of several locations for site suitability for a CNG fueling station.

• Assessment of maintenance facilities for suitability of CNG vehicle maintenance and repair.

• A discussion was held with MLA of Saskatchewan for potential CNG interest for northern communities

• Speak to FortisBC on their experience in developing and maintaining the CNG market.


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• Development of a CNG roll out plan

3.0 CNG MARKET DEVELOPMENT Natural Gas as a transportation fuel has many economic and environmental benefits. The County of Vermilion River (CVR) has successfully experimented with 6 natural gas pickup trucks and is now exploring interest among local industrial consumers. CVR’s feasibility assessment will consider the establishment of a natural gas fueling station at their operations facility located in Kitscoty. The station would be used for both municipal and industrial/public. CVR is also interested in supplying gas to fleet owners for CNG fueling on their own properties and to fuel retail stations. In order to provide maximum regional benefit of any increase in local infrastructure, CVR seeks to understand local business interest in accessing the resource.

3.1 Economic and Environmental Benefits As a by-product of the heavy oil recovery process, natural gas is an abundant resource available within the region. In addition to the economic opportunities caused by its oversupply, capturing the gas and utilizing it rather than venting or flaring it to the atmosphere presents an opportunity for the region and local industry to work together to substantially reduce local greenhouse gas emissions. For vehicle fleet fuel consumption, when compared to gasoline, using natural gas as a vehicle fuel could reduce vehicle fuel cost by over $40 cents/liter and provide fleet greenhouse gas reductions of up to 25% compared to gasoline fuel. Any reduction in natural gas venting in the Vermilion area through the capture and use of natural gas for transport will result is substantial greenhouse gas reductions.

3.2 CNG Roll-Out Plan History has shown that development of the CNG market is not straightforward. CNG users are interested in the benefits but are averse to dealing with the infrastructure, conversion, and operational aspects of the business. An alternative fuel plan developed by FortisBC has worked well in British Columbia. This plan includes full support to the CNG user, including CNG technical expertise, sales and marketing, incentive programs and training programs. In addition, the plan includes design, installation, and operation of CNG fueling stations. The plan cost, capital and operational costs are recovered from gas supply agreements. Fuel supply agreements are typically over a 10-year term. A sample natural gas vehicle contribution and fuel supply agreement is provided in Appendix A.

FortisBC’s plan includes establishing and maintaining good working relationships with various government departments. As a result, the BC Government has allocated money to this industry through incentive programs for vehicle and maintenance garage conversions. Developing a good working relationship with safety authorities and regulators is important to ensure development of proper training programs and codes and standards to ensure timely equipment and installation approvals and safety for users.

Details of the FortisBC CNG services offered can be found in the following link: https://www.fortisbc.com/NaturalGas/Business/NaturalGasVehicles/Pages/default.aspx

Important Note: FortisBC was initially not permitted by the BC Utilities Commission to use rate-payer funds to build CNG fueling stations. Prior to pursuing this model it is advisable for Vermilion River Natural Gas utility to establish whether similar restrictions apply.

It is recommended that CVR develops a vison for the CNG business and approach to the roll out of CNG. The FortisBC model is a good example and elements of it could be used. CVR should consider the following elements of the CNG plan:

https://www.fortisbc.com/NaturalGas/Business/NaturalGasVehicles/Pages/default.aspx


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• Develop a team with CNG technical and commercial expertise in

o CNG vehicles,

o Standard CNG equipment selection and design,

o Maintenance facility upgrade requirements,

o Safety and training for users, operations and maintenance,

o Operations and maintenance plan and remote monitoring of CNG stations,

o Regulations, Codes and Standards, and

o Provincial and Federal incentives based on greenhouse gas reduction.

• Develop different options for CNG supply business models and gas supply agreements

o Client own and operate,

o CVR own and operate,

o Incentives for conversion cost, and

o Incentives for public refueling at client’s property.

• Develop agreements with several CNG conversion companies for

o Reduced and fixed conversion rates, and

o Local service agreements/facilities

The plan can grow over time, but it is important to have the CNG vison developed early. Jenmar could assist with developing this plan.

3.3 CNG Survey

3.3.1 Vermilion Interest

Thirteen local companies were approached with a questionnaire to gauge the interest in CNG as transport fuel and for bulk CNG users. Companies approached include local light duty fleet owners, heavy haul trucking, waste management, municipalities, fuel retailers and bulk natural gas suppliers. A list of companies was provided by CVR. Medium and heavy-duty commercial trucking companies were removed from the list due to the lack of availability of reliable dual-fuel conversions for diesel engines.

The nearest CNG fueling stations are located Edmonton and Saskatoon both some 250km away. Based on the limited CNG supply dedicated CNG engines for pick up trucks are not practical due to the limited driving distance. Dedicated natural gas engines are practical for vehicles returning to their base; a good example being refuse haul trucks. Meetings were held with Canadian Natural Resources Limited (CNRL) and Lloydminster Co-op to discuss CNG interest. The replies to the questionnaires are provide in Annex B and a summary table in Annex D.

Based on the meetings and replies to the survey the following conclusions are drawn:

• All Bulk CNG transporters contacted are interested in CNG fuel supply in the Vermilion area and have indicated interest in a follow up meeting with CVR. More discussion is required in order to quantify the demand for CNG. A bulk trailer fill station could readily be added to the CVR CNG fuelling station.


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• City of Lloydminster is interested in CNG fueling for their Municipal Fleet. They currently have 4 CNG vehicles and are interested to expand. A follow up meeting has been requested.

• CNRL is the only company that expressed interest in CNG for their light duty fleet. CNRL has around 200 pickup trucks and are interested in an onsite fueling pilot program for 16 trucks at their Blackfoot operation. Fast fill fueling is very important for them as vehicles do not remain at the base at night or during the day. Fueling could be staged in morning and evening. Vehicles use typically 65 liters of gasoline per day. A pilot project proposal will be put together by CVR; Jenmar will supply the equipment sizing and capital cost for the project as part of the phase 2 work.

• No interest was received from commercial transport companies that would use public refueling at Kitscoty or Lloydminster. It is expected that public refueling demand will take time to develop and CNG demand will develop once several local companies operate CNG fleets. Then commercial transport companies using Highway 16 can be approached. This is addressed in a following section.

• Lloydminster District Co-op is interested in CNG for their fleet/ retail but need to understand more of the market demand. It is expected the retail market will take considerable effort to develop. It is recommended that CVR focus on the Co-op fleet vehicles. The Co-op’s gasoline fuel cost per liter is expected to be very low and CNG for their fleet may not be economically attractive.

3.3.2 Highway 16 Users

Contact with Atco gas and SaskEnergy was made. Both are gas utilities and own CNG fueling stations. Feedback was received on their CNG market and requests were made of both to share information on companies that could benefit from a CNG station on Highway 16. ATCO gas has expressed interest in working with CVR and in procurement of bulk CNG supply in the Vermilion River area. ATCO gas will follow up internally and will establish potential gas demand.

SaskEnergy no longer actively supports their CNG business for reasons unknown. Meanwhile, Atco Gas is working to upgrade its stations to increase fueling pressure to 3600 psig for their own fleets.

No one could offer information on commercial transport companies that would benefit from a CNG station on Highway 16. Developing this market will take considerable effort and any further work is outside the current scope of this study. Results of the conversations with ATCO Gas and SaskEnergy are provided in Annex D.

3.3.3 Other Users

Leads developed through discussions indicate possible interest in supplying CNG from the Vermilion region to Northern communities. Jenmar contacted Mr. Buckley Belanger, Saskatchewan MLA for Athabasca and learned there is keen interest among northern communities to establish a natural gas supply. These communities generate their power using diesel engine driven generators and energy costs are very high. Duel fuel conversions are available for stationary diesel engines and up to 30-50% of diesel can be displaced. Jenmar has experience with capital, operational cost and equipment design for the supply of CNG and LNG to remote power stations, industrial sites or gas distribution systems. CNG is transported by bulk trailers and decompressed at the power station or local gas distribution pipeline. The specific economics should be investigated and this could be part of a separate study. A bulk trailer filling station could readily be added to a CNG fueling station at the CVR operations facility for minimum incremental cost. With the interest already shown in bulk CNG fueling and from bulk fuel companies


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already in the area, this is a market worth exploring. Further, federal funding available for replacing diesel fuel for power generation could add considerable CNG demand for CVR.

3.3.4 Action Items

Findings to date suggest the following actions should be included in phase 2: • Set up meetings with bulk CNG companies. • Develop technical, capital and business case for CNRL pilot project. • Follow up with City of Lloydminster to understand interest and possible CNG station application. • Meet with Mr. Buckley Belanger, Saskatchewan MLA for Athabasca to explore Northern

Community CNG interest.

4.0 CNG FUELING LOCATIONS From the survey it can be concluded that a retail CNG vehicle refueling station located at Lloydminster is not a priority at this stage. Bulk CNG users show serious interest in a filling location. There is an interest in CNG for the municipal fleet and private pickup truck fleets with fueling on the client’s property.

Based on a single compressor fueling station installation a minimum gas equivalent demand of approximately 15,000 GJ’s is required to justify installation of a CNG station on the client’s property based on fuel supply agreement of 10 years. This equates to 25 trucks at 65-liter gasoline liter equivalent per day 5 days per week. These are general numbers and it is recommended to develop a scenario for three typical applications.

The following fueling station plans are proposed for further exploration in phase 2:

• Station A: CNG fueling station at CVR operations facility for the County’s fleet with fast fill, time fill and bulk CNG trailer filling. Time fill could be used for trucks that remain at the yard overnight for instance the dump trucks. Expansion for a public fleet fast fill fueling station should be considered for future development for Highway 16 fleet operators and back up fueling for fleet owners. The fuel load will be determined from information provided by CVR provided in Annex G.

• Station B: CNG fueling station for 15-25 privately owned vehicle fleet located at owner’s yard offering fast fill fueling. A single compressor will be used. A larger compressor with smaller storage and smaller compressor with larger storage will be considered.

• Station C: CNG fueling station located at Lloydminster Municipality works. A discussion is required to understand this CNG potential.

Phase 2 will include site layout, process flow diagram, equipment selection, capital expenditure cost estimate and operation expenditure estimate for each of the above applications.

4.1 CVR Operation Facility

4.1.1 Fueling Station

The CVR operation facility has adequate space for a CNG station and for CNG bulk trailer filling. Future provisions should be made to have private fleet vehicles fuel at the facility. A preliminary site assessment was performed for siting a CNG fueling station. The completed assessment checklist for CNG station siting is provided in Annex E and shows siting issues considered. There are no major issues identified and the site is well-suited for a CNG fueling station. A plot plan of the facility is shown below with two potential locations A and B indicated. There are multiple options possible.


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Map - Public Works Yard - Proposed CNG Station Locations A and B

The preferred option is location A near the current entrance. This location provides safe access for bulk trucks in a separate fenced area. The compressor could be located near this area with the fueling hoses located further away if required or kept local to the compressor. Details will be worked out in phase 2 and 3 specifically related to siting issues near the power lines. A 400 psig natural gas line can be brought in to the location which will be beneficial for fast filling and reduced energy costs. Fill would have to be brought in to elevate the level. The high voltage power lines running parallel to the property line will required the compressor to be set back from the property line and will be considered in the phase 2 and 3 work. CSA B108 will be the primary code used for installation set backs.

4.1.2 Maintenance Facility

A preliminary maintenance facility assessment was performed to assess suitability of the facility for CNG vehicle repairs. A CNG repair facility requires continuous ventilation or ventilation activated by gas detection depending on the nature of the repairs performed.

Based on the assessment performed the facility would be relatively simple to convert. The facility assessment checklist provided in Annex F shows items considered for a garage upgrade. The checklist has been developed based on NFPA30A and Jenmar CNG experience. There are currently no Canadian standards published addressing the safety of CNG vehicle maintenance facilities. Jenmar is a committee member for the development of the CSA B401 standard which will address CNG and LNG maintenance garage safety requirements and will be published in 2019. Jenmar’s design upgrades have been accepted for many garages by Technical Safety BC, by code officials in Alberta and the TSSA in Ontario.


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For any servicing of CNG vehicles a ventilation upgrade will be required even for minor repairs as the garage has no active ventilation. There are ventilation fans in the welding bay area, but the volume and location are not adequate.

For major repairs where fuel system and engine overhauls are performed the upgrades required are more substantial. Upgrades include gas detection, ventilation and shunt tripping of electrical circuits when gas is detected. Based on the CVR building the upgrade cost will be in the order of $200,000 - $300,000. One of the issues to be addressed for major repair is the recycled oil air heater. The unit is located inside the garage and the burner is considered an ignition source. For major repair work the burner must be removed or decommissioned.

For Bi-Fuel natural gas engines upgrade cost can be kept low by using procedures by which the fuel tank pressure is reduced, fuel tank valves are closed and by consuming the NG in the fuel supply system before servicing or repair. A ventilation upgrade would still be required to meet a minimum ventilation rate of two times per hour.

4.2 Lloydminster Municipality Works Details of the Fueling Station will be established at a later stage after a meeting has been held.

4.3 CNRL Application CNRL is interested in a pilot project for 15 trucks each using 65 liter per day. A site layout and gas line cost has been provided by CVR. CVR can provide 250 psig natural gas to the property. The same design as Station B above is planned for this application. This design could be used for other fleet owners in the 15-25 truck range. As the fleet increases multiple compressors could be considered.

5.0 CONCLUSIONS • It is recommended that CVR develops a CNG vision and roll out plan.

• The CNG survey suggests strong interest in bulk CNG fueling in the Vermilion River area.

• CVR operations facility is suitable for a CNG fueling station location. There is adequate space, good access and bulk trailer filling that can be accommodated.

• The CVR maintenance facility can be readily upgraded for CNG vehicle repairs.

• CNG for northern communities should be explored and a meeting has been set up to start this discussion.

• Meetings are to be held to understand gas demand details. Meetings can be held a day prior to the open house or conference call meetings with:

o Bulk gas companies to establish gas demand requirements.

o Lloydminster municipality to explore CNG interest and scope.

• Phase 2 will include a CVR fleet CNG station concept design including bulk trailer filling and a pick-up truck fast fill station design. If budget permits a concept station for Lloydminster municipality may be developed.


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6.0 APPENDIX A – FORTIS SAMPLE AGREEMENTS

Ver: 07/17 – 3rd Party Fueling - General

FUELING SERVICES AGREEMENT ([SITE REFERENCE]SITE)

PART I – BASIC TERMS

Customer

Company name: Mailing/billing address:

[CUSTOMER LEGAL NAME] [Address]

Contact name and title: Telephone: Email:

[Contact Name] [Telephone] [email]

Fueling Location

[Site Reference] - [Address of Site]

Term

Commencement Date: Rate Change Date:

(see section 4(b) of Part II)

Initial Term: Renewal:

(see section 1(b) of Part II)

[Commencement Date] January 1st of each year [Number of years] years One 2-year renewal

Dispensing Rate

$/Gigajoule (“GJ”), as at the Commencement Date, subject to adjustment pursuant to sections 4(b) and (c) of Part II. Capital Rate O & M Rate Overhead Rate Short Term Charge Spot Charge Host Fee Total

$ $ $0.520 $[Rate or N/A] $[Rate or N/A] $ $

Minimum Annual Quantity

[Number of GJs or N/A] GJs, subject to adjustment pursuant to section 4(c) of Part II.

Supplemental Terms and Conditions

1. Additional Charges - The Dispensing Rate payable pursuant to this Agreement is in addition to any amounts payable by the Customer to FEI for the purchase of fuel and transportation services, if applicable, pursuant to the Rate Schedules.

2. Fueling Vehicles - Unless otherwise directed by FEI by written notice to the Customer, the dispensing of fuel into the Customer’s vehicles shall be performed by the Customer.

The Customer and FortisBC Energy Inc. (“FEI”), by signing this Agreement, accept and agree to be bound by the terms and conditions herein contained. This Agreement, including Part I and Part II, constitutes the entire agreement between the parties and supersedes all other agreements with respect to the services described herein. This Agreement will not come into effect and does not bind the parties until:

(a) FEI has obtained the necessary approvals for this Agreement from all regulatory or other applicable governmental authorities having jurisdiction, including the British Columbia Utilities Commission (“BCUC”), on terms and conditions which are satisfactory to FEI.

[If Host Agreement not yet signed, add Host agreement condition precedent wording]

[If station not yet built, add station condition precedent wording]

CUSTOMER:

Signature Date

Name Title

FORTISBC ENERGY INC.:

Signature Date

Name Title

2

PART II – BACKGROUND AND TERMS AND CONDITIONS

SECTION A – BACKGROUND AND INTERPRETATION

A. Capitalized terms shall have the meanings ascribed to those terms as set out in Part I - Basic

Terms and Part II – Background and Terms and Conditions.

B. FEI, as at the Commencement Date, owns and operates fueling equipment at the Fueling

Location from which it sells and distributes fuel (the “Fueling Equipment”).

C. The Customer has agreed to purchase fuel, and obtain transportation services (if applicable),

from FEI pursuant to FortisBC Rate Schedules as established or amended from time to time (the

“Rate Schedules”) and wishes to use the Fueling Equipment to fuel their vehicles.

SECTION B – TERMS AND CONDITIONS

1. TERM

(a) Initial Term -The initial term of this Agreement will be for the period set out in Part I.

(b) Renewal - This Agreement automatically renews at the end of the Initial Term for the additional

period(s) of time set out in Part I. The Customer may decide not to renew this Agreement by

providing FEI with notice at least sixty (60) days prior to the expiry of the Initial Term.

2. USE OF FUELING EQUIPMENT AND ACCESS TO PROPERTY

(a) Use of Fueling Equipment – Provided the Customer is, at all times, in compliance with this

Agreement, and unless otherwise provided herein, the Customer shall be entitled to access and

use the Fueling Equipment to fuel vehicles.

(b) Training and Operation- The Customer shall not permit any of its personnel to access the Fueling

Location until such person has participated in and successfully completed the applicable

orientation/training (including safety training) and, when required, refresher training, either

directly from FEI or a supervisor/manager of the Customer approved by FEI or provided by any

other party that is deemed satisfactory to FEI, on the use of the Fueling Equipment, in

accordance with the manufacturer’s dispensing instructions, if applicable, all applicable laws,

and the requirements of FEI, as established or amended from time to time. The Customer shall

provide, and shall ensure each of its personnel accessing the Fueling Location and dispensing

fuel from the Fueling Equipment, or using a Fueling Card, provides proof of orientation/training

to FEI or the owner and/or occupier of the Fueling Location (the “Host”) upon request.

(c) Emergency Preparedness and Response - The Customer will, when requested by FEI from time to

time, participate in emergency preparedness and emergency response training exercises and

initiatives.

(d) Access to Property – The Customer shall only access those parts of the property on which the

Fueling Equipment is located and designated for access to the Fueling Equipment and shall, at all

times, comply with site safety instructions communicated by FEI or the Host and any on-site

signage or instructions. The Customer is aware access to the Fueling Equipment may be

detoured or made unavailable by the Host from time to time, and to the extent FEI has prior

notice of such detour or lack of access, will advise the Customer accordingly.

(e) Fueling Cards - To dispense fuel from the Fueling Equipment, the Customer shall use only those

fueling cards or other tracking devices or systems issued or implemented by FEI to the Customer

(the “Fueling Cards”). The Fueling Cards shall, at all times, be and remain the property of FEI.

FEI may cancel or withdraw any Fueling Card at any time where the Customer or anyone using

3

the Fueling Card fails to comply with the terms of this Agreement, including any on-site signage

or instructions. In such event, the Customer shall surrender the Fueling Cards to FEI on demand.

Except to the extent prohibited by law, unless the Customer has notified FEI of any loss or theft,

the Customer shall be liable for and shall pay FEI in accordance with the terms of this Agreement

for the full amount of all transactions in respect of the use of any lost or stolen Fueling Card.

(f) Personal Identification Numbers – Use of Fueling Cards shall be restricted through the use of

personal identification numbers (“PINs”). The Customer shall not reveal its PINs to any person

other than those authorized by the Customer to use the Fueling Cards. The Customer shall be

liable for and shall pay FEI in accordance with the terms of this Agreement for the full amount of

all transactions where the Customer has in any way compromised the security and

confidentiality of its PIN.

3. SAFETY

(a) Responsibility for Safety – The Customer is, at all times, responsible for the safety and protection

of its employees, contractors, agents, representatives, subcontractors and any other person for

whom the Customer is at law responsible (collectively, the “Representatives”) using the Fueling

Equipment or otherwise accessing the property on which the Fueling Equipment is located;

provided however, where the Customer’s vehicles are fueled by a third party designated by FEI,

such third parties shall not be considered Representatives of the Customer for the purposes of

this section 3.

(b) Covenant re: Training and Operation – By issuing a Fueling Card to any person, the Customer

covenants and agrees such person has successfully completed the applicable orientation and

training and will continually access and use the Fueling Equipment in a safe manner. The

Customer shall ensure, at all times, all safety requirements and on-site signage are adhered to

strictly by its Representatives. Failure to do so constitutes a material breach of this Agreement.

In addition to any remedies set out in section 6(a) or available at law, the Customer shall not

permit any Representatives who have failed to adhere to the safety requirements and on-site

signage from accessing the Fueling Equipment upon written request by FEI or the Host.

4. FEES, BILLING AND PAYMENT

(a) Dispensing Fees – The Customer, in consideration of access to and use of the Fueling Equipment,

shall pay to FEI the Dispensing Rate for each GJ of Fuel dispensed by or to the Customer from

the Fueling Equipment, as measured by a meter located on the Fueling Equipment and

attributable to the Customer through use of the Fueling Cards.

(b) Annual Rate Escalation – On the Rate Change Date of each year:

(i) the Capital Rate will increase by 2%; and

(ii) the O & M Rate will increase by the percentage increase, if any, in the Consumer Price

Index (published by Statistics Canada for the Province of British Columbia, all items, not

seasonally adjusted) from the previous twelve-month period.

(c) Change in Dispensing Rate

(i) If FEI upgrades or expands the Fueling Equipment to accommodate added demand for

fueling services, FEI and the Customer agree to negotiate in good faith an adjustment to

the Dispensing Rate and the Minimum Annual Quantity going forward, subject to BCUC

approval.

(ii) FortisBC may, in its discretion, provide temporary reductions to the Dispensing Rate

from time to time if the aggregate volume of fuel dispensed from the Fueling Equipment

4

to all customers of FEI using the Fueling Equipment who have entered into a fueling

agreement with FEI (save and except customers using the Fueling Equipment on a spot

basis) materially exceeds the aggregate contracted demand for Fuel for such customers.

(d) Minimum Guarantee - The Customer acknowledges the Dispensing Rate has been calculated by

FEI having regard to, among other things, the Customer’s estimated fuel demand profile and the

number of vehicles to be served by the Fueling Equipment, and accordingly, the Customer

agrees to pay a minimum annual charge (the “Minimum Guarantee”) calculated by multiplying

the Dispensing Rate by the Minimum Annual Quantity shown in Part I for each Service Year (pro-

rated for part years); where a “Service Year” means the twelve month period of the Term

calculated from the Rate Change Date or the anniversary thereof, provided that the first Service

Year shall commence on the Commencement Date and end the first Rate Change Date.

(e) Billing and Payment - Bills will be rendered by FEI monthly and payable by the Customer,

without deduction or set-off, within thirty (30) days following the billing date.

(f) Payment of Minimum Guarantee – Where the annual amount billed to the Customer is less than

the Minimum Annual Guarantee, the shortfall will be added to the next bill.

(g) Taxes - Any applicable taxes will be added to all rates and charges on each bill.

(h) Late Payments - Overdue payments shall be subject to a late payment charge of 1.5% per month

(19.56% per annum).

(i) Verification - The Customer must report any billing errors promptly to FEI. Statements shall be

final and binding unless questioned by the Customer within one year after its billing date. The

Customer shall have the right to review meter data and other relevant records to verify

statements. Such review shall be conducted at the Customer’s expense unless such review

discloses errors in the amount of fuel dispensed which exceed two percent (2%).

5. LIABILITY, RELEASE, DISCLAIMER, INSURANCE AND ENVIRONMENTAL COMPLIANCE

(a) Liability - The Customer is responsible for, and shall indemnify and save harmless each of FEI and

the Host from all expenses, claims and liability incurred by FEI or the Host, as applicable, with

respect to the access to and use of the Fueling Location and the Fueling Equipment by the

Customer’s personnel, including any damage to the Fueling Equipment occasioned by its use.

(b) Release - The Customer, on its own behalf and on behalf of its Representatives, hereby releases,

defends, indemnifies and holds harmless FEI and the Host, and their respective directors, officers,

employees, agents, contractors, successors and assigns, from and against any and all adverse

claims, losses, suits, actions, judgments, demands, debts, accounts, damages, costs, penalties and

expenses (including all legal fees and disbursements) arising from or incurred by or suffered as a

result of the Customer’s presence at the Fueling Location or while using the Fueling Equipment,

howsoever caused, save and except from any negligent act or omission of FEI.

(c) No Warranty and Disclaimer – The Customer acknowledges and agrees:

(i) Suitability of Fueling Equipment - FEI does not represent or warrant the adequacy or

suitability of the Fueling Equipment for the Customer’s purpose and all express or

implied warranties, terms or conditions of merchantability or fitness for a particular

purpose, whether existing at law or in equity, are expressly disclaimed by FEI.

(ii) Limitations on Use - The Customer acknowledges and is aware the fuel supply may be

temporarily suspended or unavailable from time to time, including as a result of

equipment breakdown, to make repairs or improvements to the Fueling Equipment or

to comply with the requirements of any law. FEI will, regardless of the cause of fuel

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suspension or equipment breakdown and whenever practicable, give prior notice to the

Customer of such suspension, will diligently undertake required repairs to minimize

Fueling Equipment down-time and will use commercially reasonable efforts to provide

the Customer with the right to access substituted fueling equipment on an interim basis

for the duration of fuel supply suspension or equipment breakdown and, in the event

the Customer elects to exercise such right, the Customer will bear FEI’s reasonable costs

associated with the implementation of substituted fueling equipment, on a pro rata

basis. If the supply of fuel from the Fueling Equipment is interrupted or curtailed and

FEI is unable to provide an interim dispensing location, the Customer may temporarily

utilize another source of Fuel until FEI is able to resume supply and, if applicable, the

amount of such third party fuel will be taken into account when calculating any

Minimum Guarantee payable for such year.

(d) Limitation of Liability – Neither party shall be liable to the other party for any indirect, punitive,

exemplary, incidental, aggravated, punitive or consequential damages of any kind regardless of

the form of action whether in contract, tort, strict product liability, breach of warranty, breach of

representation, misrepresentation, statutory duty, or any other legal or equitable theory, even if

such party has been advised of the possibility of such damages. This provision shall not apply to

third party claims or to any claim by FEI for loss of profit, use or interruption of business.

(e) Insurance - The Customer shall obtain and maintain the following insurance coverage and

provide proof of coverage to FEI:

(i) Workers’ Compensation Insurance in accordance with the statutory requirements;

(ii) Automobile Liability Insurance with a limit of not less than $5,000,000 per occurrence in

respect of bodily injury, death and property damage;

(iii) Comprehensive General Liability Insurance from insurers registered in and licensed to

underwrite insurance in British Columbia for bodily injury, death and property damage

in the amount of $5,000,000 per occurrence naming FEI as an additional insured with

respect to this Agreement and providing that the insurance shall not be cancelled or

materially changed without the insurer using best efforts to provide at least 30 calendar

days’ written notice to FEI; and

(iv) Such other insurance as reasonably required by FEI from time to time.

(f) Environmental Compliance - The Customer acknowledges and agrees the Customer has

environmental responsibilities arising from the Customer’s use of the Fueling Equipment

pursuant to environmental laws and regulations, including related spills, and is required to

comply with the requirements of FEI as they relate to environmental management, compliance

and reporting, copies of which requirements will be provided by FEI to the Customer from time

to time. The Customer covenants and agrees to co-operate with FEI in coordinating,

establishing, implementing and verifying processes and procedures to manage and address

environmental impacts and ensure compliance with environmental laws and regulations.

6. DEFAULT AND TERMINATION

(a) Default- If the Customer, or any person using the Fueling Cards, is unable, refuses or fails to

produce proof of training upon request by FEI, or the Customer is otherwise in default of this

Agreement, FEI may terminate this Agreement, or de-activate the applicable Fueling Cards,

temporarily or permanently, without prior notice to the Customer and without any liability to

FEI as a result thereof.

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(b) Termination of Property Agreement /Transfer of Equipment - In addition to any other termination

provisions contained herein, this Agreement will terminate concurrent with the termination of the

property agreement between FEI and the Host or the sale or transfer of the Fueling Equipment to

a third party, at no cost or liability accruing to FEI as a result of such termination, provided that, in

such event, FEI will use reasonable efforts to secure an alternate fueling location and/or alternate

Fueling Equipment for the Customer.

(c) Surrender of Fueling Cards – Upon termination of this Agreement, all Fueling Cards issued under

this Agreement will immediately cease to be valid and the Customer shall surrender the Fueling

Cards to FEI upon demand.

(d) Effect of Termination – If, prior to the expiry of the Initial Term, this Agreement is terminated by

the Customer for any reason or by FEI pursuant to section 6(a), in addition to any other amounts

due and owing by the Customer to FEI and despite any other remedies available at law or in

equity, the Customer shall pay to FEI, within 30 days of billing, the Dispensing Rate (as escalated

annually) calculated on the Minimum Annual Quantity to the end of the Initial Term.

(e) Survival - Upon expiry or early termination of this Agreement, all claims, causes of action or

other outstanding obligations remaining or being unfulfilled as of the expiry or termination date

and all of the provisions of this Agreement relating to the obligation or either the parties to

account to or indemnify the other and to pay to the other any amounts owing as at the date of

expiry or termination in connection with this Agreement will survive such expiry or termination.

(f) Effect of Termination on Other Agreements – The expiration or termination of this Agreement

does not affect or result in the expiry or termination of any other agreements made between FEI

and the Customer, including any fuel purchase agreements or transportation agreements.

7. MISCELLANEOUS

(a) Amendments - Except as set out in this Agreement, no amendment or variation of this

Agreement shall be effective or binding unless in writing and signed by the parties and, where

applicable, upon receipt of BCUC approval.

(b) Further Assurances - The Customer will execute and deliver any further agreement, document or

instrument and do and perform any further act or thing as may be reasonably required by FEI

from time to time to evidence or give full force and effect to the terms, conditions and intent of

this Agreement.

(c) Governing Law - This Agreement shall be governed by and construed in accordance with the laws

of the Province of British Columbia and the laws of Canada. The parties hereby attorn to the

jurisdiction of the courts of British Columbia and all courts competent to hear appeals therefrom.

(d) Assignment - FEI may assign, transfer or sell its right, title and interest in this Agreement, to any

Affiliate, as that term is defined in the Business Corporation Act, S.B.C. 2002, c.57.

(e) Waiver - FEI is not bound by any waiver of any provision of this Agreement unless it consents to

such waiver in writing. No waiver of any provision of this Agreement constitutes a waiver of any

other provision, nor does any waiver constitute a continuing waiver unless otherwise provided.

(f) Severability - If any provision of this Agreement is determined by a court of competent

jurisdiction to be invalid, illegal or unenforceable in any respect, such determination does not

impair or affect the validity, legality or enforceability of any other provision of this Agreement.

(g) Time of the Essence - Time is of the essence of this Agreement.

END OF DOCUMENT

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NATURAL GAS VEHICLE CONTRIBUTION AGREEMENT THIS AGREEMENT is made effective as of (the “Effective Date”)

BETWEEN:

,

(the “Recipient”)

AND:

FORTISBC ENERGY INC., 16705 Fraser Highway, Surrey, British Columbia, V4N 0E8

(“FEI”)

WHEREAS:

A. The Recipient wishes to acquire by purchase or lease and/or convert vehicles powered or to be powered by natural gas as more particularly shown in the table set out in Schedule A (the “Vehicles”, or individually, a “Vehicle”).

B. STATION OPTION 1A (build station)The Recipient further wishes to have a natural gas fueling station (the “Fueling Station”) constructed or installed on its lands located at (the “Lands”) for the purpose of fueling its own vehicles, including the Vehicles, and, since the Lands are located within a designated natural gas transportation corridor, in order to receive additional funding from FEI pursuant to this Agreement, to also provide fueling services to one or more other persons.

C. STATION OPTION 1B (use station)The Recipient intends to access one or more designated FEI third party fueling stations (each, a “Designated Fueling Station”) for the purpose of fueling the Vehicles.

D. FEI wishes to support the use of energy sources that decrease greenhouse gas emissions and encourage the use of natural gas vehicles in commercial sectors by contributing to the acquisition and/or conversion costs of natural gas vehicles utilizing its Natural Gas for Transportation (NGT) incentive funding (the “Incentive Funding Program”).

E. The Recipient has applied to FEI for funding assistance and FEI has agreed to contribute to the acquisition price and/or conversion cost of the Vehicles, as applicable, on the terms and conditions set out in this Agreement.

NOW THEREFORE, in consideration of the mutual promises set out herein and other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged) the parties agree as follows:

1. Representations and Warranties

1.1 Recipient Information. The Recipient acknowledges FEI’s decision to provide funding assistance to the Recipient is based on information provided by the Recipient in its application for NGT funding and obtained by FEI during the application review process. The Recipient represents and warrants to FEI that all such information is true and accurate as of the date of execution of this Agreement. The Recipient shall immediately notify FEI of any changes to the Recipient’s

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information or, if the representations and warranties contained in this section 1 cease to be true, at any time during the Term.

1.2 Vehicle Use. The Recipient represents and warrants to FEI the Vehicles will be primarily used in British Columbia; where primary use shall mean at least 75% of total kilometers driven in any year, or as otherwise reasonably determined by FEI.

1.3 [If fueling station is being built by Recipient use this clause, otherwise delete]Fueling Station Construction and Use - The Recipient covenants and agrees to have a Fueling Station constructed on the Lands and represents and warrants to FEI the Recipient will complete the construction of a Fueling Station so the Fueling Station is operational within three (3) years of the Effective Date (the “Station Installation Deadline”). The Recipient further covenants and agrees that the Recipient will at all times during the Term permit third parties to obtain fueling services from the Fueling Station.

1.4 Fuel Source – The Recipient acknowledges it is a condition of receiving funding from FEI hereunder the Recipient will operate the Vehicles using natural gas purchased directly from FEI or indirectly through a third party which uses natural gas purchased from FEI (collectively, an “Approved Supplier”) and the Recipient will, prior to operating the Vehicles provide a copy of its fueling plan for the Vehicles to FEI for review and approval and will, upon request from FEI, provide evidence satisfactory to FEI that the Recipient has entered into a written agreement with an Approved Supplier. [for LNG vehicles only – if CNG, delete this last sentence]If the supply of natural gas is interrupted or curtailed pursuant to FEI Rate Schedule 46, Interruptible Natural gas Sales and Dispensing Service, as amended from time to time, the Recipient may temporarily utilize another source of natural gas until FEI is able to resume supply.

1.5 Quality and Fitness of Vehicles. Despite any input, information or contribution made by FEI to the Recipient, FEI makes no warranties or representations, express or implied, with respect to the Vehicles, including their acquisition or conversion, or natural gas vehicles in general, including but not limited to any implied warranty of merchantability, fitness for a particularly purpose or durability. It is the sole responsibility of the Recipient to determine the suitability of the Vehicles for its purposes and undertake any due diligence the Recipient considers necessary and appropriate.

2. Contribution and Payment

2.1 Amount of Vehicle Contribution. FEI will make a contribution towards the acquisition or conversion (as applicable) of the maximum number of Vehicles set out in Schedule A, calculated as the Price Differential or Conversation Costs, as the case may be, each as determined in accordance with section 2.5 (Price Differential/Conversion Cost) times the Total Contribution Factor set out in Schedule A (the “Vehicle Contribution”), subject to:

(a) reduction pursuant to sections 2.3 (Maximum Contribution) and 2.2(a) (Limits to Vehicle Contribution); and

(b) repayment pursuant to sections 2.7 (Third Party Funding), 2.10 (Return of Vehicle Contribution and applicable for OPTION A only 2.11 (Return of Fueling Station Component).

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2.2 Limits to Vehicle Contribution.

(a) A Vehicle Contribution will not be made:

(i) for any purchased or leased Vehicle, where the Recipient has ordered or acquired such Vehicle prior to the Effective Date;

(ii) for any Vehicle being converted, where the Recipient has entered into a contract to convert the fuel system prior to the Effective Date; and

(iii) for any Vehicle acquired or converted after the Vehicle Deadline set out in Schedule A;

unless otherwise agreed to by FEI in writing.

2.3 Maximum Contribution. If the Vehicle Contribution exceeds the Maximum Vehicle Contribution set out in Schedule A, the Vehicle Contribution for such Vehicle will be reduced to equal the Maximum Contribution; provided that FEI may, in its sole and absolute discretion, increase the Maximum Vehicle Contribution up to a maximum of five percent (5%) for any Vehicle if the actual purchase price, lease price or Conversion Costs paid by the Recipient with respect to such Vehicle was greater than the amount originally quoted to the Recipient for such Vehicle where such increase was as a result of external factors such as exchange rate fluctuation; provided that in no event will the Vehicle Contribution exceed the Maximum Contribution.

2.4 Price Differential/Conversation Costs. “Price Differential” means the difference between the purchase or lease price of a comparable diesel powered vehicle and the purchase or lease price of the Vehicle, not including taxes and PDI; and “Conversion Costs” means the actual and direct costs paid by the Recipient to its contractors and suppliers for converting the Vehicles to operate with a natural gas fuel system.

2.5 Determination of Price Differential. For the purpose of calculating the Price Differential, the Recipient will provide evidence, satisfactory to FEI, identifying the purchase price of a diesel powered vehicle having the same or similar attributes as the Vehicle, which evidence may include recent sales or acquisitions and quotes from dealers or manufacturers.

2.6 Validation of Price Differential and Conversion Costs. FEI reserves the right to independently verify and validate the Price Differential data and the amount of the Conversion Costs and to calculate the Maximum Contribution based on the evidence provided by the Recipient or as otherwise obtained by FEI.

2.7 Third Party Funding. This Agreement does not preclude the Recipient or FEI from applying for, soliciting or accepting grants, funding or contributions from other sources towards the acquisition, conversion or operation of the Vehicles (the “Third Party Funding”), provided that if:

(a) the Recipient accepts Third Party Funding within five (5) years of the Effective Date; and

(b) such Third Party Funding would not otherwise be available to the Recipient in the ordinary course of business with respect to any vehicles; and

(c) the Vehicle Contribution plus the Third Party Funding exceeds the Price Differential;

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the Vehicle Contribution will be reduced by the amount the Vehicle Contribution made plus the Third Party Funding exceeds the Price Differential or the Conversion Costs, as the case may be, and the Recipient will return such excess amount within five (5) business days of receipt of the Third Party Funding. The Recipient covenants and agrees to immediately provide FEI the details of any applications submitted or offers or opportunities for Third Party Funding and, upon receipt of a commitment for Third Party Funding, the details and amounts thereof. Any Third Party Funding applied for, and received by FEI shall be incorporated into and become part of the Vehicle Contribution. For the purpose of this section, “Third Party Funding” does not include federal or provincial tax incentives for the acquisition and/or operation of natural gas vehicles, including any special depreciation class.

2.8 Application of Vehicle Contribution. The Recipient shall apply the Vehicle Contribution towards the purchase price of the Vehicle or Conversion Costs and not towards lease or financing payments. For any Vehicle being leased by the Recipient, the Recipient will deliver the Vehicle Contribution for such Vehicle to the vehicle leasing company to be applied to the benefit of the Recipient and the lease payments reduced accordingly. The Recipient shall provide FEI with satisfactory evidence of such payment adjustment prior to FEI making payment of the Vehicle Contribution for such Vehicle. If the Recipient is a vehicle leasing company the Vehicle Contribution will accrue to the benefit of the lessee of the Vehicle and lease payments adjusted accordingly.

2.9 Payment. FEI shall pay the Vehicle Contribution to the Recipient in the following manner:

(a) twenty-five (25%) percent within thirty (30) days following receipt of documentation satisfactory to FEI of a binding commitment for the purchase, lease or conversion of the Vehicle and either confirmation of the purchase price of a similar diesel powered vehicle in accordance with section 2.5 (Determination of Price Differential) or the estimated Conversion Costs for such Vehicle; and

(b) the balance within thirty (30) days following receipt of documentation from the Recipient satisfactory to FEI:

(i) with respect to the purchase of the Vehicle, that the purchase has been completed and the Vehicle is registered and insured in the name of the Recipient;

(ii) with respect to the lease of the Vehicle, that the lease has commenced and the Vehicle is registered and insured in the name of the Recipient as lessee and that lease payments have been adjusted in accordance with section 2.8; and

(iii) with respect to converted Vehicles, of the Conversion Costs paid by the Recipient, that the conversion of the Vehicle has been completed and the Vehicle is in service.

provided that FEI may, in its discretion, and upon notice to the Recipient, adjust the payment schedule to enable payments of the Vehicle Contribution to be made for multiple Vehicles concurrently, including upon the completion of the acquisition and/or conversion of all the Vehicles.

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2.10 Return of Vehicle Contribution.

(a) In addition to any payments or repayments to be made pursuant to section 2.7 (Third Party Funding), applicable for OPTION A only 2.11 (Return of Fueling Station Component), section 2.12 (Minimum Fuel Commitment) and section 6 (Default), the Recipient shall, unless otherwise agreed to by FEI in writing, return the Vehicle Contribution made with respect to a Vehicle, in whole or in part in accordance with subsection (b) below, and FEI will be under no obligation to make any further Vehicle Contribution with respect to such Vehicle, in the following circumstances (each a “Repayment Event”):

(i) the acquisition of the Vehicle does not complete within one (1) year of the Recipient entering into the purchase or lease commitment for the Vehicle or such later date approved in writing by FEI;

(ii) the conversion of the Vehicle and return to service does not complete within one (1) year of the Effective Date;

(iii) at any time prior to the end of the Service Life Term of the Vehicle as identified in section 2.1, which Service Life Term commences upon the completion of Vehicle registration and insurance in the name of the Recipient for acquired Vehicles and upon the completion of the conversion for converted Vehicles (the “Service Life Term”), the Recipient receives insurance proceeds as a result of the Vehicle being declared a total or constructive loss by the insurer, unless the Recipient applies the insurance proceeds to the acquisition of a replacement natural gas vehicle having the same or similar attributes as the Vehicle.

(iv) at any time prior to the end of the Service Life Term, the Recipient:

A. sells or otherwise transfers its right, title or interest in and to the Vehicle to any person without the prior written consent of FEI, which will not be unreasonably withheld;

B. removes the Vehicle from regular service, with the exception of temporary removal for the purpose of repair or maintenance;

C. does not use the Vehicle primarily in British Columbia; D. removes or replaces the natural gas fuel system components from the

Vehicle; E. when fueling the Vehicles, fails to comply with applicable natural gas

safety codes, standards and requirements, whether existing at law or in accordance with fueling and fuel management procedures as specified by FEI through training or otherwise or as set out in the Recipient’s approved fueling plan; or

F. ceases to purchase natural gas from an Approved Supplier for the purpose of fueling the Vehicles, unless otherwise approved in writing by FEI.

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(b) The Recipient will notify FEI in writing within five (5) business days of the occurrence of a Repayment Event, and within five (5) business days following such notification, the Recipient will return to FEI, with respect to each of such Vehicle or Vehicles:

(i) where sub-section 2.10(a)(i) or 2.10(a)(ii) applies, the total Vehicle Contribution;

(ii) where sub-section 2.10(a)(iii) applies, a proportionate share of the insurance proceeds based on the amount of the Vehicle Contribution relative to the price of the Vehicle; or

(iii) the Vehicle Contribution reduced at the rate of 1/Service Life Term for each completed year after the acquisition or conversion of the Vehicle prior to one or more of the conditions set out in sub-section 2.10(a)(iv) becoming applicable.

2.11 applicable for OPTION A only – Recipient installs Fueling Station Return of Fueling Station Component.

(a) If the Recipient fails to have a Fueling Station installed and operational on the Lands by the Station Installation Deadline, the Recipient will return to FEI, within thirty (30) days following the Station Installation Deadline an amount equal to the sum of the Fueling Station Factor component of the Vehicle Contribution as shown in Schedule A for all of the Vehicles.

(b) If the Recipient, at any time during the Term, after installing a Fueling Station, refuses or ceases to permit third parties to obtain fueling services from the Fueling Station, the Recipient will return to FEI, within thirty (30) days of request for payment, an amount equal to the Fueling Station Factor component of the Vehicle Contribution as shown in Schedule A for all of the Vehicles; which amount may be reduced proportionately based on the length of time, in months, the Recipient permitted third party use relative to the total number of months from the date of installation to the end of the Term. Despite the foregoing, the Recipient shall be entitled to restrict third parties who are its direct competitors, as approved by FEI, from using the Fueling Station and such restriction shall not result in the Recipient being in non-compliance with the Recipient’s obligation regarding third party use of the Fueling Station.

2.12 Minimum Fuel Commitment.

(a) The Recipient acknowledges FEI’s decision to provide funding assistance to the Recipient hereunder is based, in part, on the commitment by the Recipient to purchase at least GJs of natural gas per Vehicle annually, as may be adjusted pursuant to sub-section (b), (or an aggregate quantity equal to such amount multiplied by the number of Vehicles for which a Vehicle Contribution has been made) (the “Minimum Annual Quantity”) from an Approved Supplier. The Recipient agrees that if, at the end of each year, the Recipient has purchased less than the Minimum Annual Quantity, the Recipient will pay to FEI, within 30 days of invoice, an amount calculated as the difference between the actual amount of natural gas purchased in such year and the Minimum Annual Quantity multiplied by $ per GJ; provided that the Recipient’s obligation to make payment pursuant to this provision with respect to any year shall not apply if, for such year, the Recipient is subject to a fuel supply agreement with FEI for the supply of not less than

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the Minimum Annual Quantity of natural gas for the purpose of operating the Vehicles with minimum “take or pay” provisions.

(b) The Recipient confirms the Minimum Annual Quantity was established based on the Recipient’s own determination of proposed Vehicle usage and estimated fuel consumption, having regard to such investigations, research and analysis as the Recipient considered appropriate in the circumstances, and provided by the Recipient to FEI as part of the Recipient’s application for funding. At the request of the Recipient made prior the Recipient entering into a written order for the acquisition or conversion of the Vehicle, FEI may, in its sole and absolute discretion, adjust the Minimum Annual Quantity (either for the Term or for any year of the Term) if the Recipient can reasonably demonstrate to FEI that, based on newly acquired information and/or recalculation of estimated Vehicle usage, the Recipient has overestimated the fuel consumption; provided that in no event will the Minimum Annual Quantity be less than the equivalent of GJs per Vehicle; and the provisions of section 8.10 (Waiver) shall apply.

2.13 Overdue Payments. If the Recipient fails to make any payment or repayment due by its due date, such overdue payments will be subject to a late payment charge of 1.5% per month (19.56% per annum) and FEI shall be entitled to deduct any overdue amounts, including the late payment charges thereon, from any future Vehicle Contribution to the Recipient.

2.14 Security Interest. In consideration of FEI making a financial contribution towards the acquisition or conversion of the Vehicles, the Recipient hereby grants to FEI a security interest in and to the Vehicles to secure the Recipient’s obligations under this Agreement and the Recipient hereby consents to the registration of such security interest by FEI in priority to any other security interest over the Vehicles, save and except any security interest granted to lenders as a purchase money security interest or registered against such Vehicles as serial numbered goods and granted to enable the purchase of the Vehicles.

3. Maintenance and Use of Vehicles

3.1 Operating and Maintenance. Except as otherwise provided in this Agreement, at all times during the Service Life Term, the Recipient is responsible for the purchase, use, operation and maintenance of the Vehicles, including any modifications or upgrades required to the Recipient’s facilities to accommodate the Vehicles.

3.2 Vehicle Data and Information. During the Service Life Term, the Recipient shall provide to FEI all data and information reasonably requested by FEI from time to time with respect to the Vehicles, including mileage, gas consumption and hours of usage (if tracked). FEI shall be entitled to use all such data and information for statistical, marketing and other purposes, to include such data and information in any reports, publications and other records distributed by FEI from time to time and to disclose such data and information to any governmental authority, including the BCUC; provided that when disclosing such data publicly, FEI agrees not to attribute such data to the Recipient by name or in a manner which would identify the data as belonging to the Recipient, except to the extent required by law or as otherwise agreed by the Recipient in writing.

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4. Publicity

4.1 Vehicle Decals. FEI shall be entitled to affix decals to the exterior of the Vehicles incorporating FEI’s corporate logo and web-site information and identifying the Vehicles as powered by natural gas by FEI, all of reasonable size and prominence as approved by the Recipient, which approval will not be unreasonably withheld, delayed or conditioned.

4.2 Public Announcements.

(a) Neither party shall issue a press release, public announcement, or marketing or promotional material with respect to the Vehicle Contribution or this Agreement (the “Marketing Materials”) without the consent of the other party, such consent not to be unreasonably withheld, delayed or conditioned.

(b) The Recipient shall acknowledge FEI’s contribution towards the Vehicles in all Marketing Materials issued by or on behalf of the Recipient.

(c) This section shall not restrict FEI from publicly disclosing the award of funding (including the details thereof) or making regulatory submissions with respect to such funding without being required to obtain the Recipient’s consent.

5. Indemnification

5.1 Recipient Indemnity. The Recipient shall indemnify and hold harmless each of FEI, its affiliates and their employees, directors, representatives, agents, officers and contractors from and against any and all adverse claims, losses, suits, actions, judgments, demands, debts, accounts, damages, costs, penalties and expenses (including all legal fees and disbursements) arising from or out of:

(a) any injury to persons (including death) or loss of or damage to property which may be or be alleged to be caused or suffered as a result of the use or operation of the Vehicles;

(b) any claim, demand or action made by a third party against it or any of them based upon FEI’s capacity as a provider of financial assistance under this Agreement; or

(c) any breach by the Recipient, its employees, directors, officers, representatives, agents or contractors of any of the provisions contained in this Agreement.

6. Default

6.1 Default by the Recipient. If, in the opinion of FEI, the Recipient has made any misrepresentation under the terms of this Agreement, or has failed to proceed diligently with the purchase of the Vehicles or is otherwise in default on carrying out the terms and conditions of this Agreement, FEI may exercise any or all of the following remedies:

(a) terminate this Agreement in whole or in part;

(b) terminate its obligation to pay any Vehicle Contribution, whether due or accruing due at the time of such termination; and

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(c) require the Recipient to immediately repay all or any part of the Vehicle Contributions made by FEI to the Recipient.

7. Dispute resolution

7.1 Where any dispute arises out of or in connection with this Agreement, either party may request the other party to appoint senior representatives to meet and attempt to resolve the dispute either by direct negotiations or mediation. Unresolved disputes may be submitted for final resolution by arbitration administered by the British Columbia International Commercial Arbitration Centre under its “Shorter Rules for Domestic Commercial Arbitration” in Vancouver, British Columbia, Canada. The language of that arbitration will be English. Alternatively, the Parties may agree, within 15 days of request by a party for final resolution, to submit that dispute for final resolution by arbitration in another manner.

7.2 The parties shall continue to fulfill their respective obligations pursuant to this Agreement during the resolution of any dispute in accordance with this section.

8. General

8.1 Term. The term of this Agreement shall commence on the Effective Date and terminate upon the expiration of the Service Life Term of all of the Vehicles, unless terminated earlier pursuant to the terms and conditions of this Agreement (the “Term”).

8.2 Inspection and Audit. The Recipient shall, at all times during the Term, maintain accurate and complete records of its operations, including with respect to the information provided by the Recipient in its application for NGT funding, and the use and activities of the Vehicles (collectively, the “Records”). The Recipient agrees FEI or its authorized representative shall have access to and the right to examine and audit the Records and the operations of the Recipient at any time during regular business hours to ensure the accuracy of the Recipient’s application and compliance with terms of this Agreement.

8.3 Costs. Except as otherwise set out in this Agreement, each party will be responsible for the payment of its own costs and expenses related to performing its obligations under this Agreement.

8.4 Survival. The following sections shall survive the termination or expiration of this Agreement: Sections 2.7 [Third Party Funding], 2.10 [Return of Vehicle Contribution], applicable for OPTION A only 2.11 [Return of Fueling Station Component], 2.12 [Minimum Fuel Commitment], 5 [Indemnification], 7 [Dispute Resolution], 8.5 [Governing Law] and 8.8 [Notice].

8.5 Governing law. This Agreement shall be governed by and construed in accordance with the laws of the Province of British Columbia and the laws of Canada. The parties hereby attorn to the jurisdiction of the courts of British Columbia.

8.6 Assignment. The Recipient shall not assign its rights and obligations under this Agreement without the prior written consent of FEI, which consent shall not be unreasonably withheld. FEI may assign this Agreement, or parts thereof, to any of its affiliated entities.

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8.7 Relationship. Nothing contained in this Agreement shall be construed to place the parties in the role of partners or joint venturers or agents and no party shall have the power to obligate or bind any other party in any manner whatsoever.

8.8 Notice. Any notices or other communication required to be given or made pursuant to the Agreement shall, unless otherwise expressly provided herein, be in writing and shall be personally delivered to or forwarded by postage prepaid mail to either party at its address set forth below:

TO FEI: FORTISBC ENERGY INC. 16705 Fraser Highway, Surrey, BC V4N 0E8

Attention: FortisBC NGT Incentive Program Energy Products & Services

TO THE RECIPIENT:

Attention:

8.9 Amendments. No amendment or variation of the Agreement shall be effective or binding upon the parties unless such amendment or variation is set forth in writing and duly executed by the parties.

8.10 Waiver. No party is bound by any waiver of any provision of this Agreement unless such waiver is consented to in writing by that party. No waiver of any provisions of this Agreement constitutes a waiver of any other provision, nor does any waiver constitute a continuing waiver unless otherwise provided.

8.11 Enurement. This Agreement enures to the benefit of and is binding on the parties and their respective successors and permitted assigns.

8.12 Severability. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination does not impair or affect the validity, legality or enforceability of any other provision of this Agreement.

8.13 Further Assurances. The parties shall sign such further and other documents and do and perform and cause to be done and performed such further and other acts and things as may be necessary or desirable in order to give full effect to this Agreement.

8.14 Remedies Cumulative. All rights and remedies of each party under this Agreement are cumulative and may be exercised at any time and from time to time, independently and in combination.

8.15 Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written. There are no conditions, covenants, representations, warranties or other provisions, whether express or implied, collateral, statutory or otherwise, relating to the subject matter of this Agreement except as provided in this Agreement.

11

8.16 Time is of the essence. Time is of the essence of this Agreement.

8.17 Execution. This Agreement may be executed in counterparts, each of which shall be deemed as an original, but all of which shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by facsimile or electronic transmission hereof shall be as effective as delivery of an originally executed counterpart hereof.

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first above written.

FORTISBC ENERGY INC. by its authorized signatory(ies): Name: Title: Name: Title:

by its authorized signatory(ies): Name: Title: Name: Title:

12

SCHEDULE A

COMMERCIAL TERMS 1. CONTRIBUTION FACTORS (% of Price Differential):

Base Factor Fueling Station Factor Volume Factor Total Contribution Factor (1A)

50% 20% % %

2. VEHICLES:

(a) Vehicle Deadline: (b) Description of Vehicles:

Vehicles Service Life (in years) Description Quantity

3. CONTRIBUTION:

Vehicle Estimated Price Differential

(Per Vehicle) (3A)

Maximum Vehicle Contribution

(1A x 3A)

$ $

$ $

$ $


Doc. No. 99-106-005-00



Page 30 of 76


Date: 2018-11-06

7.0 APPENDIX B – CNG SURVEY REPLIES

Jenmar Concepts www.jenmarconcepts.com

Tel: 604-757-9082

Fax: 604-888-4431

JENMAR CONCEPTS

#319 9440 202nd Street, Langley, BC, V1M 4A6

Address

XXXXX

September 21, 2018

Dear Mr./Ms.: XXXXXX

Subject: Interest in Natural Gas as a Fuel for Company Vehicular Fleet - Reply Requested by October 18, 2018

Natural Gas as a transportation fuel has many economic and environmental benefits. The County of Vermillion River (CVR)

has successfully experimented with several natural gas vehicles among its own fleet and is now exploring interest among

local industrial consumers. The County’s feasibility assessment will consider the establishment of a natural gas fuelling

station in the Vermilion River area for both municipal and industrial/public use.

A Win-Win

CVR’s experience with the conversions of vehicles to Compressed Natural Gas (CNG) has been very positive, and the County

is now considering converting more of its fleet to Natural Gas and developing the necessary infrastructure to increase the

economic and environmental benefits already enjoyed. In order to provide maximum regional benefit of any increase in

local infrastructure, the County seeks to understand local business interest in accessing the resource.

As a by-product of the heavy oil recovery process, natural gas is an abundant resource available within the region. In

addition to the economic opportunities caused by its oversupply, capturing the gas and utilizing it rather than venting or

flaring it to the atmosphere presents an opportunity for the region and local industry to work together to substantially

reduce local greenhouse gas emissions. For the fleets, when compared to gasoline consumption, using natural gas as a

vehicle fuel could reduce your vehicle fuel cost by over $40 cents/liter and provide fleet greenhouse gas reductions of up to

24%.

Interested?

To gauge your interest, we ask you to complete the attached questionnaire. All responses will be held in confidence with

only general findings released.

A public open house and presentation has been scheduled to provide information and an opportunity to discuss the

benefits and the feasibility of converting your business vehicles to natural gas. The Open House will be held on December

6th, 2018 at 7 PM at the Blackfoot Community Hall, 5406 Railway Avenue, Blackfoot, Alberta, T0B 0L0.

Completed questionnaires may be emailed to [email protected]. Please return questionnaires by October 18,

2018.

Jenmar Concepts has many years of alternative fuel experience and has been contracted by the County of Vermilion River to

carry out the feasibility study.

Thank you for your input in this important initiative. Please feel free to contact Jenmar representatives Jac Neels or Geoff

Bowering, or County representative Louis Genest, to discuss any question you may have.

Sincerely,

Jac Neels P.Eng

Senior Project Engineer

Jenmar Concepts

778-908-7510

[email protected]

Louis Genest

Director of Natural Gas Utility

County of Vermilion River

780-846-2222

[email protected]

Geoff Bowering CCLP

VP Business Development

Jenmar Concepts

604-757-9082 x 102

[email protected]


Tel: 604-757-9082

Fax: 604-888-4431

JENMAR CONCEPTS


Natural Gas Fuel for Vehicular Fleets - Questionnaire

Please submit completed questionnaire to [email protected] by October 18th.

Contact Name: ____________________________________________________________________

Telephone: _______________________________________________________________________

email: ___________________________________________________________________________

Company Name: ___________________________________________________________________

Address: __________________________________________________________________________

Business Description: ________________________________________________________________

1. Do you currently operate natural gas fueled vehicles? Yes/No Quantity

2. If so, what type of vehicle fuel storage is used? CNG LNG

3. Number of gasoline / diesel vehicles currently operated? Gasoline Diesel

4. What vehicle types do you operate? (Light duty, delivery, highway, transport, off-road, etc.)

____________________________________________________________________________________

5. What is your current annual fuel consumption in liters? Gasoline Diesel CNG

6. What is your typical daily driving distance / range for your vehicles _______________________________

7. Are vehicles returning to their base every day? _______________________________________________

8. Is overnight filling (slow filling) and option for you? ___________________________________________

9. Would you consider converting all or a portion of your fleet to CNG? _____________________________

10. Would your operation utilize a public refueling station in the County of Vermilion River? _____________

11. Would your operation set up a refueling station at your facility for public and/ or fleet refuelling?

________________________________

12. Would you be interested in a short meeting with the County of Vermilion River to discuss potential benefits

of natural gas vehicles?

_________________________________________________________________

13. Any other comments? Please feel free to provide as a separate attachment.

Abbreviations: CNG - Compressor Natural Gas, LNG – Liquefied Natural Gas


Tel: 604-757-9082

Fax: 604-888-4431

JENMAR CONCEPTS


Address

XXXXX

September 21, 2018

Dear Mr./Ms.: XXXXXX

Subject: Interest in Compressed Natural Gas Bulk Trailer Loading Facility in Vermilion River - Reply Requested by October

18, 2018

Natural Gas as a transportation fuel has many economic and environmental benefits. The County of Vermillion River (CVR)

has successfully experimented with several natural gas vehicles among its own fleet and is now exploring interest among

local industrial consumers. The County’s feasibility assessment will consider the establishment of a natural gas fuelling

station in the Vermilion River area for both municipal and industrial/public use.

A Win-Win

CVR’s experience with the conversions of vehicles to CNG has been very positive, and the County is now considering

converting more of its fleet to Natural Gas and developing the necessary infrastructure to increase the economic and

environmental benefits already enjoyed. In order to provide maximum regional benefit of any increase in local

infrastructure, the County seeks to understand local business interest in accessing the resource.

As a transporter and supplier of bulk natural gas to pipeline maintenance operations your business requires a source of CNG

for the filling of your trailers. The County is interested to learn whether your operations would benefit from new availability

within the region.

As a by-product of the heavy oil recovery process, natural gas is an abundant resource available within the region. In

addition to the economic opportunities caused by its oversupply, capturing the gas and utilizing it rather than venting or

flaring it to the atmosphere presents an opportunity for the region and local industry to work together to substantially

reduce local greenhouse gas emissions.

Interested?

To gauge your interest, we ask you to complete the attached questionnaire. All responses will be held in confidence with

only general findings released.

A public open house and presentation has been scheduled to provide information and an opportunity to discuss the

benefits of accessing a regional supply of natural gas. The Open House will be held on December 6th, 2018 at 7 PM at the

Blackfoot Community Hall, 5406 Railway Avenue, Blackfoot, Alberta, T0B 0L0.

Completed questionnaires may be emailed to [email protected]. Please return questionnaires by October 18,

2018.

Jenmar Concepts has many years of alternative fuel experience and has been contracted by the County of Vermilion River to

carry out the feasibility study.

Thank you for your input in this important initiative. Please feel free to contact Jenmar representatives Jac Neels or Geoff

Bowering, or County representative Louis Genest, to discuss any question you may have.

Sincerely,

Jac Neels P.Eng

Senior Project Engineer

Jenmar Concepts

778-908-7510

[email protected]

Louis Genest

Director of Natural Gas Utility

County of Vermilion River

780-846-2222

[email protected]

Geoff Bowering CCLP

VP Business Development

Jenmar Concepts

604-757-9082 x 102

[email protected]


Tel: 604-757-9082

Fax: 604-888-4431

JENMAR CONCEPTS


Natural Gas for Bulk Transport - Questionnaire

Please submit completed questionnaire to [email protected] by October 18th.

Contact Name: ____________________________________________________________________

Telephone: _______________________________________________________________________

email: ___________________________________________________________________________

Company Name: ___________________________________________________________________

Address: __________________________________________________________________________

Business Description: ________________________________________________________________

1. What is your estimated monthly gas volume requirement? Sm3 or Scf

2. Estimated number of fills per month?

3. Please indicate your trailer size / sizes. (Water volume, m3 or cf) and quantity of each.

____________________________________________________________________________________

4. Indicate your desired trailer CNG fill pressure (kPa or psig).

5. What length of time do you consider an acceptable time to fill (minutes)?


of natural gas vehicles?

_________________________________________________________________

7. Any other comments? Please feel free to provide as a separate attachment, if desired.


Tel: 604-757-9082 Fax: 604-888-4431

JENMAR CONCEPTS #319 9440 202nd Street, Langley, BC, V1M 4A6

Natural Gas for Bulk Transport - Questionnaire Please submit completed questionnaire to [email protected] by October 18th. Contact Name: ____________________________________________________________________ Telephone: _______________________________________________________________________ email: ___________________________________________________________________________ Company Name: ___________________________________________________________________ Address: __________________________________________________________________________ Business Description: ________________________________________________________________ 1. What is your estimated monthly gas volume requirement? Sm3 or Scf 2. Estimated number of fills per month? 3. Please indicate your trailer size / sizes. (Water volume, m3 or cf) and quantity of each. ____________________________________________________________________________________ 4. Indicate your desired trailer CNG fill pressure (kPa or psig). 5. What length of time do you consider an acceptable time to fill (minutes)?


of natural gas vehicles? _________________________________________________________________


mailto:[email protected]


Tel: 604-757-9082 Fax: 604-888-4431


Natural Gas Fuel for Vehicular Fleets - Questionnaire Please submit completed questionnaire to [email protected] by October 18th. Contact Name: ____________________________________________________________________ Telephone: _______________________________________________________________________ email: ___________________________________________________________________________ Company Name: ___________________________________________________________________ Address: __________________________________________________________________________ Business Description: ________________________________________________________________ 1. Do you currently operate natural gas fueled vehicles? Yes/No Quantity 2. If so, what type of vehicle fuel storage is used? CNG LNG



____________________________________________________________________________________







11. Would your operation set up a refueling station at your facility for public and/ or fleet refuelling? ________________________________________________________________



13. Any other comments? Please feel free to provide as a separate attachment. Abbreviations: CNG - Compressor Natural Gas, LNG – Liquefied Natural Gas



Tel: 604-757-9082 Fax: 604-888-4431





____________________________________________________________________________________













Tel: 604-757-9082 Fax: 604-888-4431





____________________________________________________________________________________













Tel: 604-757-9082 Fax: 604-888-4431


Natural Gas for Bulk Transport - Questionnaire Please submit completed questionnaire to [email protected] by October 18th. Contact Name: ____________________________________________________________________ Telephone: _______________________________________________________________________ email: ___________________________________________________________________________ Company Name: ___________________________________________________________________ Address: __________________________________________________________________________ Business Description: ________________________________________________________________ 1. What is your estimated monthly gas volume requirement? Sm3 or Scf 2. Estimated number of fills per month? 3. Please indicate your trailer size / sizes. (Water volume, m3 or cf) and quantity of each. ____________________________________________________________________________________ 4. Indicate your desired trailer CNG fill pressure (kPa or psig). 5. What length of time do you consider an acceptable time to fill (minutes)?






Doc. No. 99-106-005-00



Page 41 of 76


Date: 2018-11-06

8.0 APPENDIX C – SUMMARY TABLE SURVEY RESULTS

CNG SURVEY DETAILS

Project Identification: Vermillion River CNG Feasibility Job No.:

Document No: 99-106-004-00 Rev. No.:

Ref Drawing No.: NA Date:

Prepared by: Jac Neels P.Eng. Page:

checked by: Approved by:

CNG Interest Survey

Firm

Questionnaire/

Survey Type contact

email Type of business

Contact

Reply

received

Questionn

aire

Completed

?

CNG

Interest

Interest in

meeting

Atco Gas NA Cody Brookwell Gas Utility 587 583 2025 Y N Y ?

Sasks Energy NA Mitch Carlson (ex Sask Energy) Gas Utility Y N N ?

Smokey Lake County Bulk CNG Daniel Moric

[email protected] Gas Utility/Emergency

CNG Trailer Operator780 656 3730

Y Y Y Y

Ferus Bulk CNG

Robert Walker Director of

Corporate Development [email protected] Natural Gas Fuels 403 695 3111

Y Y Y Y

Plum Natural Gas Solutions Bulk CNG Don Fraser [email protected] Bulk CNG transport

403 700 5323 Y Y Y Y

Gas Alberta Transportation Dave Symon/Kyle Patterson [email protected] 403 509 2614 Y N N N

Certarus Transportation Sheldon Sephton/ Paul Horton [email protected] 403 991-7285 N N ? ?

CNRL Transportation Ian Hundeby

[email protected] Crude oil and Natural Gas

ProducerY N Y Y

Husky Energy Transportation Steve Mayne [email protected] Retail - Fuel N N ? ?

City of Lloydminster Transportation Dave Henning [email protected] Municipal 780 874 3700 Y Y Y Y

Lloydminster and District Co-op Transportation Leanne [email protected]

Retail -

Fuel/Grocery/Agriculture 306 825 8130 Y Y Y Y

Cornerstone Co-op Transportation Dwayne Odgaard [email protected] Retail Cooperative 780 614 1880 Y Y N N

Quik Pick Transportation Jason Dalton, GM 1-877-475-4100 N N ? ?

Waste Management Lloydminster Transportation Justin WhitePass to Edmonton Office Waste Management

Y N ? ?

Quest Disposal and Recycling Transportation Jarrett Melenka, Ops Mgr [email protected] 844 840-2467 N N ? ?

PC=Passenger Car

LD = Light Duty

OR=Off Road

MD=Medium Duty

HD= Heavey Duty

P= Possible

NA= Not applicable

? = No information received

Y=Yes

N=No

99-106

A

2018-10-30

1 of 1

J.Neels


Doc. No. 99-106-005-00



Page 44 of 76


Date: 2018-11-06

9.0 APPENDIX D – ATCO GAS / SASKENERGY

1

Jac Neels

Subject: FW: Vermillion

I did talk to Mitch Carlson, an old former Sask Energy contact. Some notes below.

- Says that SaskEnergy is trying to sell their Saskatoon CNG station

- Has far as he knows they have no interest any longer in CNG

- Says they have retrenched to their core business and believes CNG and LNG is dead

Mitch has been doing work on flare gas capture and trying to find loads. Some points coming out of this.

1. Should we consider oil drilling (i.e. displacement of diesel with CNG) as a load. Must be a lot of this going on in

the area. CNG bulk transport for drilling rigs

2. Should we consider bulk CNG transport to remote communities as a load. Mitch says there are communities

like Ile-a-la-Crosse, about 460 km northeast of Vermillion that are heating with electric heat generated by diesel

gensets and their energy bills are $1100 per month. There is an MLA for the area named Buckley Belanger that

has been interested in alternative for these communities. P: 833-3200 or 1-800-239-9820 (toll free)

E: [email protected]

3. Another avenue is to contact firms like Blue Source a carbon credit trading firm that may be able to match

consumers with supply.

1

Jac Neels

Subject: FW: ATCO Gas

Cody Brookwell Coordinator, Energy Management Services ATCO Pipelines & Liquids Global Business Unit

T. 587-583-2025

I called Cody Brookwell of ATCO gas. A few notes

1. There have been no load increases at the existing stations in Edmonton

2. All the existing stations are not located near major transport or trucking corridors so are not suitable for

trucking. Cody is convinced, and I agree, that to support transportation load growth, we would need to target

commercial trucking and that a station would need to be very conveniently located next to a highway. There is

nothing like this now.

3. All existing stations in Edmonton, are not set up for HD fuelling. The fuelling performance is also not there;

stations not big enough; pressure still 3000 psig.

4. Cody is pursuing ERA (Emissions Reduction Alberta) funding but there seems to be growing interest in electrical

and other solutions. There are some 180 applicants for project funding and he has put in an application for 2-3

CNG stations. He seems rather pessimistic to get the funding.

5. He thinks that Vermilioin is strategically located for a corridor fuelling station if load were to develop.

6. The cost for CNG in Edmonton is between $0.70 and $0.75 per DLE.

7. ATCO Gas does not seem to be putting in any substantial effort in finding CNG load. Cody is working to upgrade

existing CNG facilities that are located at their maintenance and service locations to service their fleets. As

mentioned, SaskEnergy seems to be getting out of CNG so this is not promising.

In the short term it would seem that load growth for Vermilion driven by a transportation corridor between Edmonton

and Saskatchewan will not materialize in the short term, if ever. A return to base philosophy finding local load is

probably the most viable solution.


Doc. No. 99-106-005-00



Page 47 of 76


Date: 2018-11-06

10.0 APPENDIX E – CVR FUELING STATION SITING ASSESSMENT CHECKLIST

Page 1 of 9

JENMAR CONCEPTS A division of Jenmar Compressors Inc.


Telephone: 604-888-4430; Facsimile: 604-888-4431

CNG EQUIPMENT SITING

ASSESSMENT WORKSHEET

Project 99-106

Date: 01 0ctober 2018

Author: J.Neels p.eng.

Project Name: CVR CNG Feasibility

Project Location/Address: Public Works Kitscoty, 505040 Highway 897

Elevation of site (meters): 670 m

Company/Owner/contact person County of Vermillion River

Project start date: Sept 2018

Scheduled project completion date Feb 2019

SITE DETAILS

Drawing of Plot Plan Number: See Appendix

Legal Description TBD

Zoning Commercial

Industrial

Residential

Property

Topography

Surface preparation

Drainage

Length: X

Width:X

Area:X

Generally, Flat -

Sloped -

Steep slope

streams/ creeks/ ponds/ lakes

moors/wetlands

other: -

-Storm gulley between road & property line

-gentle slope from north to south

Location (locate on plot plan):

-Parallel with Range Road 31

Greenfield

Soil/ Dirt

Gravel

Asphalt

Concrete

Underground storm water drainage

Page 2 of 9




Open storm water drainage

Other:

-Terrain gently sloped from North to South

-Larger gradient to South near CNG Location B.

Property Access

Security

Operation of existing facility

Existing Safety Equipment

Number of access lanes: 2

Location of Lanes: see plot plan

Access road name:

-Range Road 31

Fence Provided: Yes

Type of fence: Chain Link Fence with motorized Gates.

Extent of fence:

Controlled security gates gates open during the day

Manned Access control

24/7 security on site

Security routine checks

CCTV monitored on site

CCTV monitored remotely

24/7 operation personnel on site

day shift operation personnel on site

Remotely monitored, daily checks

Fire Hydrant - TBD

Sprinkler System

Fire monitoring

Make:

Model: NA

Gas monitoring

Make:

Model:

Page 3 of 9




Primary activity on property

Offices

Work Shop maintenance facility , offices.

Process Plant

Power Generation

Mining

Warehousing storage matl. & equipment

Chemical Storage

Material type:

Storage capacity:

Tank type:

Fuel Storage

Fuel type: - Diesel/Gasoline

Storage capacity:

Tank type:

Fuel Storage/ dispensing

Fuel type: - Diesel/Gasoline

Storage capacity

Dispenser type:

Describe:

- Fuelling of county vehicles


- See plot plan

Adjacent Properties/ Activities Residential

Commercial

Industrial

Police/ correctional

Educational/school

Hospital/Clinics

Shopping Mall

Public Places

Airport

Rail Road

Substation

North-

Name: CVR

Activity: new offices planned

Number of people: -NA

East-

Name: Range Road 31

Activity: acreage Residential

Number of people: NA

South-

Name:

Activity: Recycling/ Transport Company

Number of people: NA

Page 4 of 9




West-

Name:

Activity: Lake

Number of people:NA

CNG SITING – PLANNING

CNG Plant type Fueling Station

Mobile Fueling Station

Fuel storage - ASME STORAGE

Other:

CNG Equipment

-CNG Twin Compressor

-ASME Fuel Storage for Fast Fill Supply

-Dispenser 1 Or 2

-Time Fill ~ 5-10 Hoses

-Public Fleet Dispenser Located near property line.

-Bulk Trailer Fill Post

Instrument Air - NA

Control room / offices

Electrical room – Electrical supply point at road.

Storage room

Other

Locate best location on plot plan:

See Location A or B. Other Locations Possible.

Power Generation (skid mounted) – Review Requirements.

Number: NA

Size: (m) L X (m) W

Locate best location on plot plan: NA

CNG Trailer Filling Drive through/loop – Preferred location inside property location

A.

Back Up

Constraints:

LNG SITING - POTENTIAL HAZARDS/ SAFETY DISTANCES

Electrical Equipment

HV Power Lines

LV Power Lines

Substation

Arcing Sparking Equipment

Page 5 of 9




Rail Road

Other:

Describe:

-(>600v) - on property line parallel with Range Road 31


RUNS ALONG

Open Flames Flares

Fired equipment

Welding shop

Other:

Describe:

-Oil tanks are decommissioned.

-welding in maintenance shop


Buildings / Equipment in proximity of

proposed CNG plant

(not on Plot Plan Drawing)

Offices

Equipment sheds

Welding shop

Canopy (fueling or other)

Fuel Storage Tanks

Capacity:

Size:

LNG Storage Tanks NA

Capacity:

Size:

Diesel Storage Tanks - TBD

Capacity:

Size:

GASOLINE Tanks - TBD

Capacity:

Describe:

Gasoline and Diesel storage tanks may be relocated when new

offices are built.


Traffic hazards

(not on Plot Plan Drawing)

Access Road

parking

uncontrolled traffic

other:

- New Gate proposed for new offices located near

gasoline fuel storage tanks.

- South access may have to be combined with trucking

company due to limitation on the number of access

locations.

Page 6 of 9




CNG Station location relative to Property

Lines/ buildings

North: m

East: - TBD m

South: m

West: m

Constraints

Describe:

- Power High Voltage property line


Security requirements Fencing

Controlled Gates

CCTV

other:

Describe:

- Local fencing to be considered for CNG equipment.


Other Notes:

Location A - South Side of yards near property line is a good location that allows for time fill & fast fill & Bulk

trailer filling. Access for external fleets is feasible by located fuel dispenser near property line and using existing

property access.

Location A is Preferred for public or external fleet refueling – more visibility for traffic pulling in & out.

Location B is where the new gate is planned if the CVR admsitration offices are relocated at the Northg side of

the property. Location B property entrance for public and fleet fueling is not ideal visibility is limited when

driving in and out to location B.

Feed gas pressure is 80 psig. A 400 psig gas line can be brought in estimated cost is 100K$.

Preference by maintenance is walk in compressor skids.

CVR currently assemblies tap assemblies. Possible option is to purchase compressor and have CVR assemble skid

with compressors, storage and fill posts for small fleets.

CVR has equipment to perform site preparation, bringing in gas lines, and electrical.

Different ownership options for fueling stations was discussed.

- Own and operate station by CVR, fuel is sold to user on per kg or GJ basis that includes cost of

equipment and operation. Electrical cost carried by owner. Owner signs a long term typically

10-year agreement. Maintenance could be contracted out by CVR.

- Equipment is owned and operated by third party could be equipment supplier. Owner signs

long term agreement with third party, third party signs gas supply agreement with CVR.

- Own and operate by user natural gas is sold per standard gas supply agreement.

Page 7 of 9




Aerial Map – Location of Public Works Yard

Page 8 of 9




Map - Public Works Yard - Proposed CNG Station Locations A and B

A

B

Page 9 of 9




Proposed CNG Station Location A

Proposed CNG Station Location B


Doc. No. 99-106-005-00



Page 57 of 76


Date: 2018-11-06

11.0 APPENDIX F – CVR GARAGE CNG UPGRADE ASSESSMENT

Page 1 of 14




NGV SERVICE MAINTENANCE FACILITY

ASSESSMENT WORKSHEET

Project 99-106

Date: 01 0ctober 2018

Author: J.Neels P.Eng.

Project Name: CVR CNG Feasibility

Project Location/Address: Public Works Kitscoty, 505040 Highway 897

Elevation of site (meters): 670 m

Company/Owner/contact person County of Vermillion River

Mr. Louis Genest Director of Natural Gas Utility.

Project start date: Sept 2018

Scheduled project completion date Feb 2019

NOTE: This is a preliminary garage assessment to establish issues that would prevent safety upgrade to the

garage for CNG vehicle minor and in future major repairs.

BUILDING ARCHITECTURE

Floor plan drawing number

(autocad file or other)

TBD

Size of maintenance facility – area

unseparated by any walls

Width __TBD_________m 6 Bays Wide

Depth __TBD_________m Two bays deep, two bays per door.

Height _ TBD________ m

No. Of bays

Roof type flat

peaked at or near center

sloped

Roof slope (if applicable):

Roof structural

Purlins employed

steel girder

steel truss

wood truss

wood joist

other:

no

yes

Purlin depth (mm): ~ 150mm

Page 2 of 14




BUILDING ARCHITECTURE (cont’d)

Ceiling construction type Q-decking (steel or aluminum)

flat panel/sheeting (steel or aluminum)

wood sheeting (wood panel or plywood)

Other: Roof Sheeting Insulated

Insulation type: Insulation covered with plastic layer.

Gas accumulation areas no Only Depth of Perling negligible gas hold up.

yes, explain:

Mezzanine floors (describe) No

Yes, describe any gas entrapment risk

Outer wall construction

External finishing

Inside wall finishing

concrete tilt-up

structural steel

wood frame

other: __________________

wood siding

steel siding

aluminum siding

other: __________________

drywall with insulation

steel or aluminum sheeting with insulation above.

open/no insulation

other:

- First 2 – 3 meter has metal sheeting.

-Insulation exposed only above steel sheeted walls.

- Insulation has vapor barrier covering.

Internal separation wall construction

Condition of wall at ceiling

Separation wall fire rating

wood frame and drywall

steel stud and drywall

cinder block wall

other:

- Metal sheeting first 2 m.

well sealed

openings in wall

other:

1 hr

2 hr

4 hr

other: - TBD

BUILDING ARCHITECTURE (cont’d)

Access to maintenance area through

separation wall

door(s)

double door(s)

roll up door

open pathway

Page 3 of 14




Fire ratings of access doors

Man door self-closures

open with strip curtain

other:

½ hr

1 hr - To be confirmed

1.5 hr

other:

No

Yes

- Door seals to be checked.

External access door type manual roll-up

motorized roll-up

Location and number of emergency exit

doors.

4 doors, 2 each side.

Overhead crane

Possible interference with vents/ducts

Location: - Lower than 0.5m from Ceiling

No – Heater Vent protrude through building side walls.

Yes, explain:

Page 4 of 14




HEATING AND VENTILATION

Exhaust fans No. Of exhaust fans: 4

Diameter: 12” fans for weld bay area.

Power (HP):

Hazloc rating (if any): - Standard Rating.

Speed: -

Flow Capacity: -

Manufacturer: -

Model No.: -

Exhaust Fan Type

Exhaust fan controls

Exhaust fan discharge damper

Fire Damper on inlet

Exhaust Ducting

Return/Supply Air Grills

ENGINE EXHAUST FAN SYSTEM.

Supply Air Ducting

axial wall mount

axial roof mount

centrifugal wall mount

centrifugal roof mount

other: - NO ROOF FANS.

manual

automatic

gravity type

actuated/motorized

No

Yes

None

Yes

Shape:

Size:

Location relative to ceiling:

Location: Internal air circulation through recycled oil heater.

Size: NA

Number: Only local ducting.

Damper type: NA

gravity type

actuated/motorized

None

Yes

Size: each bay has engine exhaust system. Exhaust fan location to

be confirmed. Ducting is below 0.5 from ceiling, runs along center

of building.

Location relative to ceiling: Not applicable.

Grill location relative to ceiling: NA

Downdraft fans No

Yes

Manufacturer: - TBD

Page 5 of 14




Model:

No. Of fans: ~ 4

Motor location relative to ceiling (mm):>500 mm

Building Heaters Open flame heater

Radiant tube heater > 0.5m from Ceiling, installed on each side

of the building.

Catalytic heater

Sealed radiant tube heater

Direct fired MAU

Indirect fired MAU

ERV

HRV

Hydronic

Other: - Recycled oil air heater

Make/Model: Clean Burn

Fuel type: recycle oil – open likely open flame.

Location: Structure ~ 2m from grade.

Distance from ceiling: >500 mm

Number of heaters: - one oil recycle heater

Page 6 of 14




HEATING AND VENTILATION (cont’d)

Cross ventilation present

- Offices inside maintenance area

- Rooms other side of separation

wall

None

Yes, Explain:

Open flame appliance in building None

Boiler(s)

Make/model:

Fuel type:

Location:

Number:

Water heater(s)

Make/model:

Fuel type:

Location:

Number:

other: - Recycle oil heater

Page 7 of 14




ELECTRICAL DATA

Electrical schematics of building (autocad

file or other)

NA

List electrical equipment located within

500mm from ceiling

Lights – Conduits and JB for lights.

Crane

Heaters

Fans – conduits and JB of ceiling fans

Fire detection sensors - NO

Junction boxes (open)

Conduit/Cable routing – Conduits and junction boxes.

Other, Explain:

Sparking devices located in maintenance

area

No

Yes, Explain:

- Welding and power tools.

- Hoist.

Sparking devices located in the

maintenance area that could switch on

automatically.

No

Yes, Explain: - Air compressor to be confirmed.

Location of electrical distribution Panels Inside maintenance space

Outside maintenance space

Location of power supply Explain: TBD

Electrical Service Voltage: TBD

Phases:

Frequency:

Size:

Current load:

Excess capacity:

Tie-In Availability unused breaker available

space for breaker available

no space available/add panel

other: Review not performed at this stage.

Page 8 of 14




FIRE AND SAFETY SYSTEMS

Fire panel and/or Safety Panel available

No

Yes

Manufacturer: Fire or alarm panel not checked at this stage.

Model:

Location:

Gas Fire and Safety sensors/systems

available

Heat Detection - NO

Fire Sensors - NO

Smoke Detection - NO

Gas Detection - NO

nox Detection – To be confirmed at later stage.

CO Detection – To be confirmed at later stage.

Fire Bell - To be confirmed at later stage.

Audible alarm - NO

Annunciation lights - NO

Remote monitoring – To be confirmed at later stage.

Warning/shutdown provisions - NO

Activation of ventilation system - NO

Portable fire extinguishers

Other: Detailed review excluded at this stage.

Locations: ___________________________________

Emergency exit lights present No

Yes, Explain: ≈ at all 4 emergency exit doors

Emergency lighting present No

Yes, Explain: Only at emergency exit doors.

Emergency power

Condition/reliability of emergency power

system

battery UPS

automatic back-up generator

manual back-up generator - TBD

Other: Detailed review excluded at this stage.

Explain: ______________________________________

Location: _____________________________________

Page 9 of 14




FUELS AND COOLANTS

Fuels Distributed in Building un-odorized natural gas

odorized natural gas for radiant heaters

propane

gasoline

diesel

other: Recycled engine oil for heater stored in tanks inside

building.

Lubricants stored inside the genset room yes

no – Detailed review excluded at this stage.

What kind of coolant is used? ethylene glycol

propylene glycol

other: Not applicable

OPERATIONS ACTIVITIES

Type of work performed inside

maintenance space

welding

grinding

cutting

mechanical repair

other:______________________

- Two end bays separated by wall from other bays.

Partial height & partial width.

- Welding or other hot work is sometimes performed

in service bays when repairs done on implements.

POLICIES AND PROCEDURES

Emergency Response Plan available Yes Detailed review excluded at this stage.

No

Established Maintenance Procedures

available

Yes Detailed review excluded at this stage.

No

Annual Inspections Yes Detailed review excluded at this stage.

No

Insurance has been notified of change of

fuel

Yes Not required at this stage.

No

Other Notes:

1) CNG pickup trucks maintained first two bays.

Page 10 of 14




2) Possible future dump trucks with CNG

3) Repairs currently limited to minor repairs. Major repair will be considered.

4) Like to understand implication of garage upgrades based for major repairs.

Page 11 of 14




Appendix – Maintenance Facility Details.

Maintenance Facility Location

Page 12 of 14




Facing West

Facing North

Partition – Hot Work

Area

Radiant Gas

Heaters

Page 13 of 14




Fabrication and Welding Area.

Heater Details

Page 14 of 14




Recycle Oil burner/Space Heater

Adjacent Offices and Storage Areas


Doc. No. 99-106-005-00



Page 72 of 76


Date: 2018-11-06

12.0 APPENDIX G – CVR FUEL DEMAND ASSESSMENT

Page 1 of 4


#319 9440 202nd Street, Langley, BC, V1M 4A6 Telephone: 604-888-4430; Facsimile: 604-888-4431

CNG PROJECT DEFINITION WORKSHEET

Date: 2018-09-06 Document Number 99-106-003-00 Document Revision -- Project Name: County Vermilion River CNG refueling Study Project Location/Address: The County of Vermilion River, Box 69, 4912 – 50 Avenue, Box

69, 4912 – 50 Avenue, Kitscoty, Alberta T0B 2P0 Elevation of site (meters): 580 Company/Owner: County Gas Utility Project start date: September 2018 Scheduled project completion date: Mid 2020

1. Installation Type private fleet (no public access) public private fleet with public access other (explain):

2. Type of vehicles to be fueled light duty dual fuel (cars, light trucks, etc.) light duty CNG only (i.e. OEM) heavy duty industrial dual fuel heavy duty industrial CNG only (i.e. OEM) heavy duty transit buses other (explain):

3. Private Fleet Information (if applicable) Total number of NGV fleet vehicles to use the facility: 50 Type of fuel being displaced by CNG: gasoline

diesel propane other (explain):

Vehicle or conversion type: dual fuel bi-fuel: _____% CNG dedicated CNG other (explain):

Average fuel (gasoline, diesel, etc) consumed per fleet vehicle per day:

1,000 L (600-800 winter / 1100-1500 summer)

Annual fleet fuel consumption: 225,000 L

Page 2 of 4



Number of days vehicles are operated per week: 5 4. Vehicle details: Type Engine Size

(L) Fuel (Gasoline/ Diesel)

Conversion Type

Number of Vehicles of this type

Driving range required on one tank (km)

LD Truck 5.3-6.0 Gas Dual-Fuel 50 400

Notes: Type: Passenger car, minivan, SUV, work van, bus, LD truck, MD truck, HD truck Conversion type: Bi-Fuel, dual fuel, Dedicated CNG, OEM.

5. Refueling Schedule Random fueling any time throughout 24 hours Random fueling between hours of _6_:_00_ and _18_:_00_ Schedule queue fueling between hours of __:__ and __:__ Time filling between hours of __:__ and __:__ Other (explain):

6. Vehicle Fast Fueling Load Distribution (applicable to unscheduled fueling applications)* AM hour (start of hr) 12 1 2 3 4 5 6 7 8 9 10 11 No. of vehicles fueled 5 20 1 1 1 PM hour (start of hr) 12 1 2 3 4 5 6 7 8 9 10 11 No. of vehicles fueled 1 1 1 5 5

* Note: This data is applicable to random type fueling loads only such as public access retail installations or private fleet fast filling. The data is used to size compressors and ground storage capacity.

7. Future Fleet / Load Growth – (next 5 years-10 years) What are the expectations for future load growth?

Page 3 of 4



8. Fueling System Type Required (if known) 3-line fast fill metered fast fill un-metered time fill un-metered time fill metered heavy duty queue fueling other (explain):

9. Fueling Pressure Options 2900 psig @ 15oC 3600 psig @ 15oC (private only/no public access

fueling stations)

10. Equipment Redundancy* Requirements What is the impact if fuel is not available for 24+ hours?

Workable 24+ down. Needs fixed within 5 days. Redundancy would be nice (at reduced capacity would be fine) but gasoline will remain a secondary fuel. Redundancy will be less critical if we go ahead with public refueling station as well.

Are there alternate fueling sites available within a reasonable distance?

Not currently

What level of redundancy is desired (none, 50%, 100%, etc).

50%

*Note: Redundancy is defined as excess compressor capacity beyond that required to meet the demand within the available fueling window. For example, if a 100 scfm compressor is required to meet a demand of 60,000 scf in a 10 hour fuelling window, then 2 x 100 HP compressors provide 100% redundancy. If the same installation has increased demand of 90,000 scf in the same fueling window, 2 x 100 HP compressors can meet the demand in 7.5 hours but if one compressor is lost the fueling window exceeds the window by 5 hours. The additional 5 hours is more than the 10 hour fueling window therefore the level of redundancy is (15-10)/10 x 100% = 50%.

11. Gas Supply Specifications Is a gas supply available close to the site?: Yes

What is the distance to the closest tie-in point?: Adjacent Gas supply pressure(unregulated) 80 PSI

Max pressure: 80 PSI Normal pressure: 75 PSI Low pressure: 60 PSI

Regulated pressure: 60 to 80 PSI Gas composition (please provide as separate sheet if

available): Attached

Page 4 of 4



Water content: Approx 1.0 lb/mmscf average

12. Electrical Service Does the site have reserve electric power capacity? What is the service voltage? If so, how much reserve capacity (kVA)? If not, can an additional electric service be installed on the same site or must the existing service be upgraded?

Are there power demand charges in effect at this site? If so, please provide details

13. Documentation Are site layout drawings available in AutoCad format? Yes Are site infrastructure drawings available (i.e. location of in ground piping, electrical, water lines, sewer, etc.)?

Yes (not perfect though)

Other information regarding the project and/or site: The above information is regarding a private fleet conversion at the County yard. I particularly focused on our gasoline light duty vehicles. However, there may be some possibility for conversion of several (5-10) diesel heavy trucks so we should leave some room for growth there. I don’t know the specific answers regarding the Electrical Service. We have requested information from our electricity provider in this regard.

Documents

REPORT CNG FEASIBILITY STUDY