little interest because recreational boaters aren’t on the water enough to justify the investment of a natural gas system, he says.
The cost of retrofitting a gasoline engine with Blue Gas Marine’s technology depends on vessel size and the type of engine, but the company says pricing starts at $4,000 for a small boat.
Blue Gas Marine assembles its systems at its Apex facility, but the company doesn’t install them. Instead, the company trains marine service centers in how to install them. Most of that work, so far, has been for fleets. Just as operators of delivery vehicles and shuttles were the first customers for natural gas vehicles, marine fleets—patrol boats and commercial fishing vessels—are the early adopters of Blue Gas Marine’s technology. These fleets rely on hedging techniques to guard against fuel price swings, so they recognize the economic advantages of a natural gas alternative. “It costs much more up front, but you make it up in your fuel savings,” Sapienza says.
Guerreiro has his eye on the more than 12 million recreational boats that the National Marine Manufacturers Association counts in the United States. But he also envisions going beyond the retrofit market and forming partnerships with boat manufacturers. Though natural gas vehicles are now more common on the road, Guerreiro says engine makers haven’t yet warmed to natural gas marine engines because they see boating as a smaller and more limited market; there are more motor vehicles than boats, and the marine market is constrained by the lack of fueling infrastructure.
So, Blue Gas Marine is trying to build a market for its technology by piggybacking on infrastructure already in place for motor vehicles. The system’s fuel tank nozzles work at any of the 3,000 public natural gas fuel stations around the country, as well as on the natural gas lines at homes and businesses, Guerreiro says. Another option is to fill up at the docks where Blue Gas Marine has deployed mobile fuel station trailers. Some marinas are working with Blue Gas Marine to build permanent fueling installations. Guerreiro is also talking with utility companies that provide both electricity and natural gas. With electricity consumption flat, he says that utilities see a new application for natural gas as an opportunity to boost revenue. They have also proposed subsidizing new fuel stations to help speed up adoption of the technology, he says.
To fuel the company’s sales push, Blue Gas Marine is now looking to raise $5 million from investors. The money would support new training teams that could work with customers in specialized markets, such as the military and law enforcement, Guerreiro explains. The company is also developing its technology to work with the diesel engines that propel larger vessels. In his search for funding, Guerreiro has spoken with institutional investors, family offices, and the investment arms of energy companies.
Most of the angel investors who have backed Blue Gas Marine to date are from Florida and North Carolina—both big boating states. Guerreiro says investors in those states readily recognized the potential for Blue Gas Marine’s technology to disrupt the marine fuels market. The North Carolina investor interest did not come from the Research Triangle, where Guerreiro says most angels focus on software or medical technology.
“We’re like a fish out of water,” he says. “We are a technology company, except our application is the marine industry.”
