by Fueling the Future: LNG Bunkering Gains Momentum
Growing Demand for LNG as a Marine Fuel
As concerns over emissions and air pollution from the marine sector increase, LNG is emerging as a viable solution to reduce the environmental impact of shipping. LNG produces negligible sulfur oxides (SOx) and particulate matter emissions compared to conventional marine fuels such as heavy fuel oil. Greenhouse gas emissions are also significantly lower when LNG is used instead of other fossil fuels. The International Maritime Organization (IMO) has set strict limits on SOx and nitrogen oxide (NOx) emissions from ships that will take effect from 2020. This is driving greater acceptance of LNG as a marine fuel as it can help ship owners comply with these new regulations in a cost-effective manner.
Challenges in LNG Bunkering Infrastructure
Despite the benefits of LNG, a major barrier to its widespread adoption is the lack of infrastructure for bunkering or refueling LNG-fueled vessels. As LNG needs to be stored and transported at cryogenic temperatures of -162°C, specialized bunkering vessels and terminals with complex handling equipment are required. Developing this infrastructure entails huge capital investments and technical challenges associated with the cryogenic nature of LNG. There are also safety concerns related to working with such flammable and low-temperature fuels. However, with more ships switching to LNG propulsion systems, demand pressures are building for refueling operations solutions to emerge.
Pioneering LNG Bunkering Projects
Recognizing the infrastructure gap, many ports and shipping companies have taken the lead in establishing pioneering refueling operations projects to demonstrate feasibility and drive further growth. Ports like Rotterdam and Stockholm have commissioned dedicated refueling operations vessels that can fuel multiple vessels during operations. Similarly, cooperative efforts between major shipping lines and gas suppliers have led to on-ship bunkering trials. For example, ships owned by MOL, MISC and Polaris have conducted trials of LNG Bunkering from specially adapted bunker tankers. Such real-world demonstrations have improved techniques for ship-to-ship fuel transfers and loading LNG onto vessels. They also provide data to optimize bunkering procedures and equipment for commercialization.
Scaling Up Bunkering through Partnerships
As the early adopters gain operational experience, focus is now shifting to scale up refueling operations infrastructure through strategic partnerships along trade routes. Major industry collaborations include SEA-LNG, the Society for Gas as a Marine Fuel, and the Clean Shipping Alliance 2020. These alliances bring together leading players across the LNG value chain including gas suppliers, ship owners, ports, classification societies and engine manufacturers. Their combined efforts have enabled the development of larger dedicated LNG bunker vessels with capacities exceeding 5,000 cubic meters. Such vessels can service deep-sea container ships and tankers engaged in inter-regional trade. Partnerships are also spurring international bunkering corridors between key ports to ensure adequate fuel supply along busy shipping lanes. This would give ship operators confidence to invest in LNG propulsion systems for their fleets.
Growing LNG Bunkering Activity in Key Markets
Certain ports and shipping routes are emerging as prime locations driving mainstream adoption of LNG as a marine fuel. Northern European ports like Rotterdam and Hamburg have taken an early lead with operational bunkering infrastructure. Norway is utilizing its natural gas resources and expertise to set up bunkering networks along its coasts. Singapore too has formed an international partnership to import and bunker LNG at its port by 2021. Across the Atlantic, bunker activity is scaling up in the US with access to abundant domestic shale gas. With new environmental regulations due to take effect, both US coasts and the Panama Canal trade route will see growing LNG Bunkering demand going forward. As activity gathers pace in these strategic markets, it will help establish global technical standards and commercial frameworks integral to the wider deployment of LNG as a marine fuel worldwide.
Conclusion
While refueling operations is still at a relatively nascent stage of commercialization compared to established oil-based marine fuels, momentum is clearly building across the shipping industry. Pioneering projects have proven the technical feasibility while addressing initial operational challenges. Expanding partnerships are now focusing on rolling out the critical fueling infrastructure needed along major trade lanes. Supported by stricter emissions regulations, compelling economics and experience gains from early adopters, LNG Bunkering looks set to realize its potential of fueling a cleaner, more sustainable future for global seaborne trade. Wider availability of LNG at ports will tremendously help deepen ship owner confidence to increasingly convert their fleets toward LNG propulsion.
*Note:
1.Source: Coherent Market Insights, Public sources, Desk research
2.We have leveraged AI tools to mine information and compile it
