Irving Oil Ltd. has added two mills owned by the AV Group as its latest industrial customers for compressed natural gas, the Saint John-based company announced on Tuesday.
The AV Group will now use compressed natural gas at its mill in Nackawic, which is outside of Fredericton, and its northern facility in Atholville.
Al Hitzroth, the president and chief executive officer of the AV Group, said the new deal will help the company trim energy costs.
"Energy is such a significant cost driver for our business, having the option to switch fuels to take advantage of pricing volatility, which will enable us to reduce costs and make our mills more sustainable in the long run," Hitzroth said in a statement.
The AV Group is the second industrial customer to sign a deal to receive shipments of compressed natural gas by truck from Irving Oil this week.
McCain Foods announced on Monday it was converting its Grand Falls and Florenceville-Bristol facilities to use natural gas.
Daren Gillis, the general manager of Irving Energy, said in a statement these latest agreements make Irving Oil a leading provider of compressed natural gas in the region.
"We are extremely proud to have AV Nackawic as our newest customer for truck deliveries of compressed natural gas," Gillis said in a statement.
"Delivered natural gas represents an energy alternative to those without access to pipelines. Clearly the industrial appetite for lower-cost delivered natural gas exists throughout the Maritimes, and that's why we also have undertaken new CNG initiatives in Nova Scotia and PEI to fulfill that need."
The provincial government changed the rules governing natural gas deliveries in 2011 to make it easier for companies that are not on the pipeline to buy gas by truck.