The LNG news is good – but it’s complicated (and not huge).
LNG by rail (LNGR?) is coming, but not necessarily to the rescue – the government’s decision (PHMSA) to allow rail transport of LNG is certainly good news, but how good, how soon, etc., have yet to be worked out. The key issue is the specialized (DOT 113C120W9, if I have that right) cryogenic double-tanked equipment. There are ~65 cars today. In North America. And they cost, estimates Dick (“railcar guy”) Kloster, some $200K. Each. To Build. Plus the infrastructure for unit train loading and unloading, etc.
But, folks think, there is a market, at least seasonally in the Northeast, and maybe one for export, including to Mexico (and with pipelines seeming to fall by the wayside, maybe more, though US exports in 2020 are expected by HIS to fall by some 50%).
The OEMs see a new good margin market (1000 cars?); the leasing companies, who would be the equipment owners, are said to be “looking closely at this” but have the fool me twice experience of ethanol and CBR to consider; the shippers see rail as ~1/3 cheaper – and a lot safer – than trucks … the most obvious market is the N/E (benefitting Pan Am, one supposes) which is a short-to-medium length of haul market from the Marcellus to New England (when the pipes are full in peak weather seasons).
A Kloster back-of-the-envelope look showed unit trains at 20 turns/year (that’s with PSR, folks) X ~500mi X$1500-2000 car (hazmat) equaling some $30-40mm in revenues. I suspect that’s also undercounting, but also assumed unit train efficiencies, etc.