Alternative Fuels

Filling the gap in liability and compensation for alternative bunker fuel spills

Joel Ong recently wrote a blog post highlighting emerging and critical liability and compensation gaps concerning spills or leaks of alternative bunker fuels and explored possible solutions to address them.

Published

8 months ago

October 22, 2025

Admin

With the rise in the use of alternative fuels as bunker fuels in the shipping industry, Joel Ong, presently a LLM Candidate at Harvard Law School, recently wrote a blog post highlighting liability and compensation gaps concerning spills or leaks of these fuels and explored possible solutions to address them.

The following is a summary of the original post from international law blog CIL Dialogues:

The shipping industry is betting big on alternative fuels for its energy transition. Based on the 2024 orderbook, over 1700 vessels have been ordered with alternative fuel propulsion capabilities (with a more than 50% increase in 2024).

These ‘future fuels’, which serve as alternatives to fossil-fuels, are critical if the International Maritime Organization (IMO) is to deliver on its 2023 GHG Strategy of reaching net‑zero GHG international shipping emissions ‘by or around 2050.’ But using these fuels poses a new challenge: the main IMO liability conventions that protected coastal States and affected parties from oil spills do not adequately protect them against spills or leaks of alternative fuels as these new substances behave very differently compared to fossil fuels.

With the rise in alternative fuels being transported both as cargo and used as bunker fuel, the present issues are threefold: (1) existing IMO liability conventions that are in force do not apply to alternative fuels, (2) the HNS Convention is not in force, and (3) even if it were in force, and although alternative fuels are often defined as HNS falling within the HNS Convention, the Convention only applies if they are transported as cargo, but not as bunker fuel. Alternative fuels such as hydrogen, biodiesel, methanol, ammonia, or liquefied natural gas (LNG) are not persistent fossil-fuel oils (Article 1(5), 1992 CLC) within the meaning of “oil” in existing conventions (i.e. they are, as their name suggests, non-oil in nature to address climate change).

The result is an incoherent patchwork of regulations applicable to these new alternative fuels, which would result in lack of liability and compensation in the event of an accident or disaster, potentially undermining the industry and IMO’s decarbonisation efforts.

The ongoing review by the IMO Legal Committee is a critical and promising opportunity to proactively fill these emerging liability gaps. However, it must act swiftly and draw lessons from the past. By the time substantive discussions on liability for alternative fuels begin, new fuels and vessel types will likely be in operational trials or early commercial deployment.

A serious incident involving a new alternative fuel—absent a fit-for-purpose and adequate liability and compensation framework—could undermine public confidence and potentially derail the long-term prospects of that decarbonisation option altogether. For these reasons, this issue should be given the utmost priority and attention by the IMO and the shipping community and addressed as soon as practicably possible.

This blog post was written prior to the author’s study in the U.S. on 31 July 2025 and is part of the conference paper the author presented at the CIL-CLIMA Conference on the Decarbonization of Shipping and Alternative Fuels and is supported by the MPA-CIL Oceans Governance Research Programme funded by the Singapore Maritime Institute (SMI-2023-MA-03).

Note: The original blog post can be read here.

Photo credit: Joel Ong
Published: 22 October, 2025

Related Topics:Business - Events expert opinion

Up Next

China: Shanghai partners with Europe and Australia ports for green shipping corridors

Don't Miss

Law firm WFW on USTR 301 and retaliatory measures in China

Alternative Fuels

MPA and MSC ink MoU to support adoption of alternative bunker fuels

MPA and MSC will explore new routes and services to strengthen connectivity, support the adoption of alternative marine fuels such as bio-LNG, and advance technologies to improve vessel energy efficiency.

Published

9 hours ago

June 4, 2026

Admin

MPA and MSC ink MoU to support adoption of alternative bunker fuels

The Maritime and Port Authority of Singapore (MPA) on Wednesday (3 June) said it signed a Memorandum of Understanding (MoU) with MSC Mediterranean Shipping Company to strengthen collaboration in maritime decarbonisation, digitalisation, innovation, and manpower development.

The MoU was signed on 25 May 2026 by Mr Ang Wee Keong, Chief Executive of MPA, and Mr Soren Toft, Chief Executive Officer of MSC.

The MoU underscores the shared commitment of MPA and MSC to foster a sustainable, digital, and future-ready maritime sector, while enhancing MSC’s operational and business activities in Singapore. This year also marks the 30th anniversary of MSC establishing its Asia Regional Office and local office in Singapore.

Under the MoU, MPA and MSC will explore new routes and services to strengthen connectivity, support the adoption of alternative marine fuels such as bio-LNG, and advance technologies to improve vessel energy efficiency and operational performance.

MPA and MSC will also collaborate on maritime digitalisation initiatives to improve operational efficiency, including streamlining vessel arrivals and port operations.

On manpower development, MSC will support internship and scholarship opportunities through Singapore Maritime Foundation’s Maritime Outreach Network (MaritimeONE) platform, an industry-led tripartite partnership comprising industry, government and institutes of higher learning that aims to raise awareness of the maritime industry and attract quality talent into the maritime sector.

Mr Ang Wee Keong, Chief Executive of MPA, said: “This partnership reflects the strong collaboration between MPA and MSC in driving sustainability and digitalisation in the maritime sector. By working together on decarbonisation, operational efficiency and talent development, we aim to strengthen Maritime Singapore’s position as a trusted and future-ready global maritime hub.”

Mr Soren Toft, Chief Executive Officer of MSC, said: “Singapore is a strategically important hub for MSC and a key gateway to the broader Asia region. As we mark 30 years in Singapore, this MOU reinforces our long-term commitment to strengthening our presence here. MSC and Singapore are closely aligned on the priorities shaping the future of global shipping, and we look forward to deepening this partnership to drive the continued growth and resilience of the maritime industry.”

Photo credit: Maritime and Port Authority of Singapore
Published: 4 June, 2026

Methanol

Seaspan and Hapag-Lloyd complete first of five methanol vessel retrofit

Following “Seaspan Yangtze”, the remaining vessels planned for retrofit under the methanol retrofit programme are “Seaspan Amazon”, “Seaspan Ganges”, “Seaspan Thames”, and “Seaspan Zambezi”.

Published

9 hours ago

June 4, 2026

Admin

Seaspan and Hapag-Lloyd complete first of five methanol vessel retrofit

Seaspan Corporation (Seaspan) and Hapag-Lloyd on Wednesday (3 June) announced the successful completion of the first of the five vessel conversions under their methanol retrofit programme with the delivery of Seaspan Yangtze.

From the early SAVER (Seaspan Action for Vessel Energy Reduction) programme to today’s CleanBlue initiative, Seaspan has committed over USD 230 USD million across 86 vessels, executing more than 550 efficiency and retrofit projects.

Following Seaspan Yangtze, the remaining vessels planned for retrofit under the programme are Seaspan Amazon, Seaspan Ganges, Seaspan Thames, and Seaspan Zambezi. Each retrofit is expected to reduce well-to-wake CO₂e emissions by approximately 30,000 to 50,000 metric tonnes per vessel annually when operating on low-carbon methanol, while also extending vessel lifespan and enhancing fuel flexibility.

“Decarbonisation is not just about building the fleet of tomorrow, it is also about unlocking the full potential of the fleet we have today. Retrofitting and upgrades on existing fleets play a practical, immediate, and economical role in accelerating shipping’s decarbonization journey,” said Bing Chen, Chairman, President and CEO of Seaspan.

“Project SAVER CleanBlue highlights Seaspan’s strong customer partnerships, deep technical expertise, and unique platform integrated with JV partners, such as WattSpan Maritime Technology, in executing complex and large-scale retrofit projects.”

“The successful conversion of the Seaspan Yangtze together with the planned retrofit of its four sister vessels is another important step on our ambitious path towards net-zero fleet operations by 2045,” said Silke Lehmköster, Managing Director, Fleet, Hapag-Lloyd.

“Together with Seaspan, we are demonstrating that retrofitting existing vessels for low-carbon methanol can be a practical way to reduce emissions in shipping.”

Photo credit: Seaspan
Published: 4 June, 2026

Nuclear

South Korean-led nuclear car carrier design secures LR backing

LR is working with HHI, KSOE, Hyundai Glovis, G- Marine Service and KAERI on a joint development project exploring an advanced small modular reactor (SMR) installation on a PCTC.

Published

9 hours ago

June 4, 2026

Admin

South Korean-led nuclear car carrier design secures LR backing

Classification society Lloyd’s Register (LR) on Tuesday (2 June) said it has teamed up with South Korean shipbuilding, marine services and nuclear research organisations to advance the development of a nuclear‑assisted car carrier concept.

LR is working with Hyundai Heavy Industries, Korea Shipbuilding & Offshore Engineering (KSOE), Hyundai Glovis, G- Marine Service and the Korea Atomic Energy Research Institute (KAERI) on a joint development project (JDP) exploring an advanced small modular reactor (SMR) installation on a pure car and truck carrier (PCTC).

The study focused on how a Molten Salt Reactor (MSR) could be physically and operationally integrated into a large vehicle carrier. Work examined the internal arrangement and segregation of the reactor system, shielding requirements, and the impact on cargo deck layout and vehicle capacity, alongside stability and trim implications linked to the reactor’s weight and positioning.

The partners also assessed propulsion system configuration and power delivery, as well as operational flexibility compared with conventionally fuelled PCTCs, where trade routes and port calls can be tightly constrained.

A key focus of the project has been safety. LR led hazard identification (HAZID) and preliminary risk assessment work, focusing on containment, onboard safety systems and potential operability constraints tied to nuclear technology at sea.

The partners will mark the project milestone with an Approval in Principle (AiP) granting ceremony on 2 June at the LR stand during Posidonia 2026.

Sung-Gu Park, President – North East Asia, Lloyd’s Register, said: “While nuclear propulsion is still at an early stage of development, this project shows the importance of building technical understanding now to support future progress.

“Establishing feasibility at concept stage is a valuable step forward, particularly in areas such as cargo optimisation, vessel stability and integrated safety design.”

Hong-Ryeul Ryu, CTO and Senior Executive Vice President at HD HHI, said: “With global environmental regulations becoming increasingly stringent and no definitive net-zero fuel yet available, SMR-powered ships can serve as a highly effective alternative, representing a pioneering next-generation maritime technology capable of complying with GHG emission regulations while allowing lifetime operation without refuelling, and HD HHI will remain at the forefront of sustainable maritime technology development.”

Photo credit: Lloyd’s Register
Published: 4 June, 2026