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ABS survey: LNG and hydrogen emerge as future bunker fuel frontrunners

LNG was the solution for IMO 2050 for 47% of respondents, while hydrogen was the answer for 40%; 8% opted for ammonia and 5% for methanol.

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Liquefied natural gas (LNG) and hydrogen are viewed as frontrunners to be the fuels that will help shipping reach IMO decarbonisation ambitions, according to a new survey conducted by classification and technical advisory service provider ABS earlier in October.

LNG was the solution to the 2050 emissions target for 47% of respondents to the ABS Future Fuels LinkedIn Survey, while hydrogen was the answer for 40%. Just 8% opted for ammonia and 5% for methanol.

LNG was again the dominant fuel option to get the industry to 2030 targets, securing the support of 64% of respondents, against 22% for hydrogen and 7% each for ammonia and methanol.

The results illustrate the challenges facing shipowners in developing fleets that meet and exceed IMO targets.

“Owners of internationally trading ships are facing increasingly complex investment decisions as they try to navigate the most efficient course to the low-carbon future, which is why ABS has moved to simplify the landscape by identifying three fuel pathways potentially open to shipping,” said Christopher J. Wiernicki, ABS Chairman, President and CEO.

“The first pathway is defined as ‘Light Gas’, using generally light, small molecule fuels with high energy content, but more demanding, mainly cryogenic fuel supply systems and storage. This group includes the relatively mature methane (as LNG) solution leading towards bio-derived or synthetic methane, and ultimately to hydrogen as fuel,” said Wiernicki.

“On this pathway, if methane slip is discounted, LNG can reduce GHG emissions by approximately 20%; bio-methane can be carbon neutral, while hydrogen is a zero-carbon fuel. Hydrogen can serve as the ultimate solution along this pathway, but it will necessitate significant technical advances, which may require a decade or more, until it becomes a practical solution.

“The second pathway is defined as ‘Heavy Gas’, by using generally heavier, more complex molecules, but with less demanding fuel supply and storage requirements than the light gas pathway. This group includes LPG, methanol and ethanol, leading to bio-derived or synthetic LPG/methanol and ultimately to ammonia.

He added: “On this pathway, methanol can reduce CO2 by approximately 10 percent, while bio-methanol can be carbon neutral, and ammonia is a zero-carbon fuel. While ammonia shows considerable promise as a fuel, the technology for its application still needs to be developed, and regulations must account for its particular safety considerations.

“The third pathway hinges on bio/synthetic fuels that are derived from renewable sources and can produce liquid fuels. These fuels have similar properties to diesel oil and thus are much less demanding in terms of new infrastructure and technologies onboard and can be utilized with minimal changes to current ship designs.

In the future, a third generation of biofuels, such as lignocellulosic or algae-based fuels could potentially provide the industry with almost 500 million tons of fuels annually, more than the current annual bunker demand. This group includes electro/synthetic Gas-to-Liquid (GTL) fuels produced though either carbon capture and electrolysis, or from converting biomass to syngas and then to liquid fuels such as methanol or diesel.”

But which particular pathway makes sense for a shipowner to focus on will depend on the operational profile and trade of the vessel, cautioned Wiernicki.

“In all likelihood, the fleet of the future will be fuelled by a variety of choices, including oil, that will be selected depending on the owner’s operational preferences,” he said. “Although we are fuel and technology agnostic, ABS focuses on working across the board to help owners not only reach their decarbonisation and sustainability targets but hit them successfully, while maintaining a laser focus on safety.”

 

Photo credit: ABS
Published: 28 October, 2020

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Ammonia

GCMD in midst of developing emergency response plan for ammonia STS ops

GCMD is working with Oil Spill Response Limited, BlueTack and Stream Marine Technical to develop a draft ERP for ammonia STS operations, with the aim of adapting it for bunkering.

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GCMD in midst of developing emergency response plan for ammonia STS ops

The Global Centre for Maritime Decarbonisation on Tuesday (23 July) said it has been developing an emergency response plan (ERP) draft with industry partners specifically tailored to accidental ammonia release.

The partners GCMD is working with are Oil Spill Response Limited, BlueTack and Stream Marine Technical.

“GCMD is working with industry partners to develop a draft ERP for ammonia STS operations, with the aim of adapting it for bunkering,” it said in an update. 

Given ammonia’s toxicity, GCMD said it was important to have a well-defined emergency response plan (ERP) to minimise the impact of accidental ammonia release and safeguard life, property, and the environment.

“Existing ERPs for oil and chemical spills can provide a valuable foundation, especially in areas such as tiered response levels based on the severity of release,” it said.

“This, in turn, determines resource needs and multi-agency coordination protocols. However, it is important to recognise that we will need to supplement these plans with procedures tailored to ammonia’s properties.”

The provisional ERP report is scheduled to be released in Q4 of 2024. 

Note: GCMD’s visuals for a preview of the ammonia release ERP it is working on, highlighting some of the scenarios when ammonia is released both into sea and air, can be found here

 

Photo credit: Global Centre for Maritime Decarbonisation
Published: 23 July 2024

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Alternative Fuels

MMMCZCS publishes report on preparing tanker vessels for conversion to green bunker fuels

Converting tankers to green fuels can be technically and economically feasible when carefully considered in the context of fleet transition planning and asset age profiles, says MMMCZCS.

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MMMCZCS publishes report on preparing tanker vessels for conversion to green bunker fuels

The Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (MMMCZCS) recently released its latest publication that sheds light on the technical, economic and environmental impact of preparing tanker vessels for conversion to alternative bunker fuels.

The publication titled ‘Preparing Tanker Vessels for Conversion to Green Fuels’ aims to understand the technical requirements and cost of converting from fuel oil to methanol or ammonia and from liquefied natural gas (LNG) to ammonia.

The publication outlined the project results related to converting tanker vessels to methanol or ammonia fuels.

“To decarbonise the global shipping industry, the world fleet needs to transition to using alternative fuels,” it said.

“However, shipowners are met with a big scope of challenges as they build their decarbonization strategies and determine how to most effectively time their investments in alternative fuel and technologies.”

The report considered reference designs for two types of tanker vessels: LR2 and VLCC. 

These vessel types are two of the largest in the tanker segment, often travel long routes, and have a high fuel consumption ― therefore, they can provide a good illustration of the economic and environmental impacts of different choices relating to vessel conversion. 

For each vessel design, the center defined five levels of preparation for alternative fuels, ranging from no preparation (Level 0) to a dual-fuel newbuild ready to operate on methanol or ammonia (Level 4).

For the LR2 design, the center’s model indicated that the total add-on cost of newbuilding and conversion to operation on methanol or ammonia, depending on preparation level and range, is:

  • 14-27% of the cost of a standard fuel oil newbuild for fuel oil-methanol conversions
  • 25-42% of the cost of a standard fuel oil newbuild for fuel oil-ammonia conversions
  • 47-62% of the cost of a standard fuel oil newbuild (or 21-34% of the cost of an LNG newbuild) for LNG‑ammonia conversions

 The main takeaways from its publication are:

  • Converting tankers to green fuels is technically and economically feasible with careful fleet transition planning and consideration of asset age. The industry possesses the necessary technology and engineering expertise for these conversions.
  • The economic impact of conversions varies based on the chosen green fuel and vessel range.
  • Conversion to alternative fuels affects a vessel’s operating envelope due to differences in energy density and fuel tank size requirements.
  • To maintain the same operational range as fossil fuels, shipowners may need to add tanks on deck (impacting DWT) or sacrifice part of the cargo capacity for fuel tanks.
  • This project focuses on options that reduce the vessel’s operating range but preserve its cargo capacity. Such solutions are believed to have commercial applicability based on industry knowledge.
  • Conversions after ten years of operation on fossil fuels can still considerably reduce a vessel's lifetime greenhouse gas emissions, though financial viability of conversions at this stage of the vessel’s lifetime must be considered.

Note: The full report by MMMCZCS can be viewed here.

 

Photo credit: Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping
Published: 23 July 2024

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Alternative Fuels

Argus Media Q&A: Aviation may pull feeds away from marine, says BV

Biofuel feedstocks could be routed away from marine fuels to meet demand from the aviation sector if the latter is willing to pay higher prices associated with sustainable aviation fuel, says Bureau Veritas.

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Biofuel feedstocks could be routed away from marine fuels to meet demand from the aviation sector if the latter is willing to pay higher prices associated with sustainable aviation fuel (SAF), Bureau Veritas (BV) Marine & Offshore's global market leader for sustainable shipping Julien Boulland told Argus. Edited highlights follow:

19 July 2024

Marine biodiesel has been the largest alternative fuel uptake, with over 1mn t sold in Rotterdam and Singapore last year. But with Argus assessments showing premiums above $225/t to VLSFO dob ARA, how do you see marine biodiesel demand in the medium- to long-term?

Shipowners and ship operators have to run an individual cost-analysis on whether the premiums could be offset by potential savings under EU emissions trading system (ETS) and FuelEU Maritime regulations, as well as any future regulations such as the International Maritime Organisation (IMO) economic pricing mechanism.

In terms of emissions, biofuels still emit CO2 on a tank-to-wake basis, but less on a well-to-wake basis compared to their fossil equivalents. This will also vary depending on the feedstock for the biofuel as well as the production process.

Under the current IMO regulations for energy efficiency, including the Ship Energy Management Plan (SEEMP) and its requirements for fuel reporting (DCS), there might be some indirect commercial benefits for owners, too. For example, a better CII (Carbon Intensity Indicator) score may make a vessel more appealing to charterers and help its owner secure more favourable rates.

There are also other factors to consider, such as Scope 3 emissions rights, which can influence demand, as we currently see from voluntary demand from cargo owners seeking those documents.

But this will also have a geographic impact on demand, as larger container liner companies usually utilise the east-west route and they might prefer to opt for bunkering the marine biodiesel blend in Singapore due to lower prices.

What are the risks associated with bunkering marine biodiesel in relation to conventional ship engines? How significant is the recent FOBAS report that implied a correlation between the use of "unidentified" biofuels and engine pump injector damage?

We have supported our shipowner clients in numerous pilots to trial biofuels such as fatty acid methyl ester (Fame) and hydrotreated vegetable oil (HVO) in variable blends.

Overall, these trials have gone smoothly, but we have learned a few things along the way.

Firstly, engines do not need to be modified, but since biofuels have slightly different physical properties, it is necessary to find the right engine adjustments. A very good knowledge of the fuel properties is key in determining the right adjustments, and the new revision of ISO 8217 on marine fuel specifications is crucial in supporting this process. Another key finding is the importance of receiving full information on fuel characteristics from the supplier. Finally, BV plays a key role in ensuring full fuel certification on several aspects, including sustainability and physical properties.

Used cooking oil (UCO) can also feed into SAF and with potentially greater refining margins. Do you think some feedstocks will be pulled away from marine?

When it comes to methanol, we believed marine would take up more of the feedstock compared with the chemicals industry due to greater willingness to pay larger premiums.

But with biofuels, it seems to be the other way around where aviation could end up pulling biofuel feedstocks away from maritime. In terms of fuel consumption, the marine and aviation industries are comparable but if aviation are willing to pay more, then it will likely get more of the feedstocks required to produce SAF.

What are the implications of the new ISO specifications, what are the key takeaways for marine biodiesel uptake?

More has to be done, but now we have parameters for assessing biofuel blend specifications.

It was very well accepted by the industry, and now operators and shipowners have a standard to rely on. 

But it doesn't resolve the question around feedstock cross-industry competition. However, it does also open the door for off-spec Fame residue blends to become ISO-certified — depending on further testing.

With IMO aiming for "global regulations for a global market", how do you see conflicts between different regulations affecting the market?

We are closely following the IMO development process for a global economic pricing mechanism.

IMO has assigned a working group of technical experts to look at this mechanism from an apolitical perspective.

In terms of potential regulatory conflicts, we have the example of the Netherlands, where the Dutch emission authority requires the delivery of Proof of Sustainability (PoS) certificates for applying to the scheme of Dutch renewable tickets (HBE-G) which can be traded, but this PoS cannot be used for other purposes, such as the EU ETS. To circumvent this hiccup, we may see the development of new digital certificates, such as an accompanying ISCC-certified Proof of Compliance (PoC).

By Hussein Al-Khalisy

Related: FOBAS announces publication of ISO 8217:2024 marine fuel specifications and FAQs

 

Photo credit and source: Argus Media
Published: 23 July, 2024

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