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Bunker Fuel

Circtec and bp ink agreements to advance renewable tyre-derived bunker fuel

Both signed eight-year offtake and EUR 12.5 million funding agreements for the production of renewable drop-in marine fuel and circular naphtha petrochemical feedstock from waste tyres.

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UK-based technology company Circtec on Thursday (2 May) said it signed an eight-year offtake agreement with bp for Circtec’s proprietary Hevea Upgraded Pyrolysis Advanced (HUPATM) renewable drop-in marine fuel and circular naphtha petrochemical feedstock.

Under the agreement bp is committed to purchasing up to 60,000 metric tonnes (mt) per year of HUPATM renewable drop-in marine fuel and up to 15,000 tonnes per year of circular naphtha petrochemical feedstock, on a take-or-pay basis, from Circtec’s new commercial-scale plant, for eight years after the new plant is commissioned. 

The EUR 285 million (USD 307 million) new plant, currently awaiting construction in Delfzijl, The Netherlands, will be constructed to have the capacity to process 200,000 tonnes per year of waste tyres into HUPATM renewable drop in marine fuel, circular naphtha petrochemical feedstock and circular chemical recovered carbon black (rCB). 

Construction of the new plant is planned to start this year with the first phase of the plant intended to become operational in 2025. bp has also committed to providing EUR 12.5 million of investment through debt capital, to support the EUR 100 million development of the first phase of the Delfzijl plant.

Over the past decade Circtec has invested in research and development, patent protection and extensive trials with multiple shipping operators to bring the HUPATM product to the marine transport market. 

HUPA is 50% biogenic and its biogenic portion is certified as having a GHG reduction impact of 87% compared to fossil marine fuel. The product, which is compliant with marine fuels regulations and standards - is ISCC certified for its Greenhouse Gas reduction effect and can be used by shipping operators, blended with fossil marine fuels, to meet the requirements of legal mandates on marine decarbonisation under the EU’s FuelEU Maritime Regulation and Renewable Energy Directive.

Starting from next year, European Union legislation mandates a progressively increasing obligation on decarbonisation of marine transport rising to 80% decarbonisation by 2050. This legislation is expected to drive demand for shipping companies sailing into and out of Europe to find lower carbon fuel products that are available at scale to fuel their vessels. 

Circtec said it was the only company globally that can make HUPATM drop-in marine fuel from waste tyre feedstock that addresses these European mandates.

The Delfzijl plant is Circtec’s first commercial-scale plant investment following a 15-year technology and product development process. Circtec is planning the development of several plant projects globally over the next few years, starting with North America and Southeast Asia, as direct owner-operator plants and as joint-venture licensing partnerships. 

A previous long-term offtake partnership for the entire output from the new Delfzijl plant of Circtec’s circular chemical product, recovered carbon black (rCB), was announced in 2021 with Birla Carbon, one of the world’s largest producers of the chemical carbon black. This is supplied to Birla Carbon for their ContinuaTM SCM flagship decarbonisation product line. 

The processing capacity of the Circtec Delfzijl plant will account for circa 6% of European waste tyres annually; over 50% of European waste tyres are currently burned in cement plants or exported to Asia for disposal. An ISO-standard Life Cycle Assessment of the Circtec plant investment shows it is expected to reduce GHG emissions by equivalent to circa 3% of the national emissions of the Netherlands’ chemical industry sector once the plant is at full scale.

Allen Timpany, CEO and Cofounder of Circtec, said: “This entry into offtake and funding agreements with bp provides Circtec with a long-term offtake relationship, which will assist with our growth plans over the coming years, and accelerate the development of our pyrolysis plant capacity to produce renewable and circular products from waste feedstock.”

“We hope that by working together Circtec and bp can help shipping operators tackle their GHG emissions, while addressing the serious environmental problem of end-of-life tyres. The Delfzijl plant will be a significant industrial decarbonisation investment in the Netherlands, and bp’s support is an important part of making that happen.”

Sven Boss-Walker, SVP Refining and Products Trading at bp, said: “We’re excited to work with the team at Circtec, especially as the company enters a new chapter and begins its expansion in The Netherlands this year. With the HUPA renewable drop-in marine fuel, Circtec is supporting the shipping industry with the solutions it needs to help achieve its sustainability goals.”

 

Photo credit: Scott Graham on Unsplash
Published: 6 May 2024

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Methanol

China: CHIMBUSCO Jiangsu completes methanol bunkering operation in Taizhou

Firm successfully delivered 79.5 metric tonnes of methanol bunker fuel to container ship “NCL VESTLAND” using a mobile methanol bunkering skid at Taizhou Sanfu Marine Engineering.

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China: CHIMBUSCO Jiangsu completes methanol bunkering operation in Taizhou

CHIMBUSCO Jiangsu on Tuesday (3 December) said it successfully refuelled the new methanol dual-fuel powered 1,300TEU container ship NCL VESTLAND at Taizhou Sanfu Marine Engineering.

The total amount of methanol bunker fuel delivered to the boxship was 79.5 metric tonnes.

CHIMBUSCO Jiangsu said the implementation of bunkering operation marked a major breakthrough for the company in the application of alternative fuels for ships, marking its ability to supply methanol marine fuel to ships on a regular basis.

A mobile methanol bunkering skid jointly developed by CHIMBUSCO Jiangsu and COSCO (Lianyungang) Liquid Loading & Unloading Equipment was used for the bunkering operation, which was successfully completed in 2.5 hours. 

In a separate statement, COSCO Shipping said the bunkering operation represented CHIMBUSCO Jiangsu’s first marine methanol fuel supply onshore.

The mobile methanol filling skid operates using the pump as its power source to facilitate simultaneous unloading and refuelling tasks. 

This skid includes several key functional modules, each of which is highly integrated. This integration ensures a safe and efficient process for transferring methanol fuel from tankers to a vessel’s fuel bunker, while also enabling seamless operation and intelligent management. 

The mobile methanol filling skid offers flexibility, requires low initial investment, and boasts a rapid bunkering rate of 180 cubic metres (m3) per hour. 

It stands as an optimal solution for methanol bunkering in the era before widespread adoption of methanol bunkering vessels. Additionally, it can provide bunkering support for shipyards to test new vessels and meet the bunkering requirements of the shipyard,” it added. 

 

Photo credit: CHIMBUSCO Jiangsu
Published: 6 December, 2024

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LNG Bunkering

SEA-LNG: Invest more in LNG bunker vessels, supply and liquefaction infrastructure

LNG bunker market, while growing substantially, is lagging and concerns persist regarding the ability to supply the rapidly growing fleet of LNG-fuelled vessels.

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SEA-LNG: Invest more in LNG bunker vessels, supply and liquefaction infrastructure

Industry coalition SEA-LNG on Thursday (5 December) said that while the approximately 2,200 LNG-fuelled vessels and LNG carriers represent only ‘two minutes into the hour’ of the global fleet of approximately 60,000 deep sea vessels, it remains an adolescent fuel that is maturing significantly faster than other alternative bunker fuels. 

However, it said the LNG pathway still needs more investment, especially in landside facilities for liquefaction near ports, bio and synthetic methane production and bunkering capacity worldwide.

This year has witnessed unprecedented investment in the maturing and scaling of LNG from ship owners.  LNG is starting to dominate as the preferred future fuel pathway. 

However, the bunker market, while growing substantially, is lagging and concerns persist regarding the ability to supply the rapidly growing fleet of LNG-fuelled vessels.

Peter Keller, Chairman, SEA-LNG, said: “With high profile owners now choosing the LNG pathway, we anticipate this trend will continue and accelerate through 2025 and beyond.”

“As the various alternative fuel pathways mature, there is a growing realisation that, despite previous aspirations, some alternative fuel pathways – like the LNG pathway – are more practical and realistic than others.”

“While investment in newbuild LNG-fuelled ships is robust, we need to see the same for bunker vessels, supply and liquefaction infrastructure. As the LNG pathway continues to mature and the use of liquefied biomethane and eventually e-methane increases, the delivery of the fuel to vessels must be assured and the investment gap closed.”

Keller added: “There are approximately 60,000 deep sea ships on the water and, today, we’re looking at around 600 LNG capable ships afloat with a further 600 on order. There are another 1,000 LNG cargo carriers and bunker vessels of varying sizes.”

“While that’s a small percentage of the global fleet, as the clock ticks towards shipping’s emissions reduction targets, the LNG pathway is maturing far faster than other alternative fuels.”

According to DNV there are currently 54 methanol vessels and 2 ammonia vessels on the water.

There are aspects of LNG usage that are fully mature – safety for one. LNG is easy to transport, poses minimal, if any, risk to marine environments, has a low flammability range and is non-toxic. Effective regulations, standards and guidelines for safe operations are widespread, and LNG has been shipped around the world for almost 60 years without any major incidents at sea or in ports.

Keller continued: “When compared to traditional fuels, LNG is more of a teenager with all the growing pains, challenges and victories associated with adolescence.”

“But it is maturing all the time as the market continues to grow, new build orders continue to rise, and the LNG pathway with biomethane and eventually e-methane produced from renewable hydrogen, gains acceptance globally.”

“Shipping stakeholders are investing in LNG because it provides a low risk, incremental pathway for decarbonisation, starting now.  The other alternative fuels are basically toddlers by comparison.  And when it comes to safety, some are mere newborns!”

Another critical need in the maturing process during a period of increased regulation of carbon emissions is the adoption of standardised chain of custody models on a worldwide basis. 

Chain of custody models are becoming increasingly important to maritime decarbonisation as they provide mechanisms to verify that the fuels used are low carbon. 

Such verification creates investor confidence in new fuel supply chains and accelerates the transition to low-carbon fuels, enabling early adoption in conditions of limited supply. 

“They will create a market for green fuels by connecting buyers to fuel producers away from bunker ports enabling faster scaling and providing flexibility to shipping companies at lower cost,” SEA-LNG added.

 

Photo credit: SEA-LNG
Published: 6 December, 2024

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Bunker Fuel

Cost-efficient strategies can significantly cut price of FuelEU Maritime compliance, says DNV

Adoption of the most cost-effective strategy can result in savings of up to 16% or USD 21 million over a vessel’s lifetime compared to using Bio-MGO as a compliance option, according to new DNV white paper.

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Classification society DNV on Thursday (5 December) said compliance with FuelEU Maritime requirements will be expensive but applying certain strategies can significantly reduce the cost.

This was one of the main highlights of its latest white paper outlining FuelEU Maritime requirements and compliance strategies for shipowners. 

Effective from 1 January 2025, the rules mandate stringent greenhouse gas (GHG) emission intensity requirements for ships over 5,000 gross tonnage (GT) transporting cargo or passengers for commercial purposes in the EU/ EEA. GHG emissions are calculated from a well-to-wake perspective. In addition to emissions from onboard combustion, this calculation also includes emissions related to the extraction, cultivation, production, and transport of the fuel. 

The regulation includes provisions for crediting ships using wind-assisted propulsion.

The DNV paper provides shipowners with insights to reduce compliance expenses and avoid major penalties. It contains a comprehensive overview of the regulation, including a case study which highlights a range of different compliance strategies. 

This shows how the adoption of the most cost-effective strategy can result in savings of up to 16% or USD 21 million over a vessel’s lifetime compared to using Bio-MGO as a compliance option.

Knut Ørbeck-Nilssen, DNV Maritime CEO, said: “It is essential that shipowners understand the requirements and compliance options related to the FuelEU Maritime regulation to make informed business decisions. Adopting a cost-efficient strategy with the right combination of measures can help shipowners reach compliance at reduced costs.

“Just paying the penalty could prove a more costly option. All parties must understand their potential obligations and privileges, and how these might affect their commercial and compliance agreements. Crucial to this is verified emissions data, which can maintain operational and commercial integrity across the maritime value chain.”

The report provides recommendations for shipowners including securing long-term fuel agreements and implementing energy efficiency measures. It also recommends considering pooling as a mechanism for sharing and optimizing costs. This is underpinned by a call to begin preparations immediately. The report also highlights how, by leveraging digital tools, maritime stakeholders can access verified emissions data, a key factor in compliance and maintaining both operational and commercial integrity throughout the value chain.

A key point emphasized in the report is that the International Maritime Organization is also set to introduce similar regulations in the near future, with a net-zero framework expected to be adopted in the fall of 2025 and come into force around mid-2027.

It is absolutely essential that shipowners understand the requirements and compliance options related to the FuelEU Maritime regulation so that they are equipped to make informed business decisions. Adopting a cost-efficient strategy with the right combination of measures can help shipowners reach compliance and significantly reduce costs.

“Doing nothing and paying the penalty could prove to be a costly option. All parties must understand their potential obligations and privileges, and how these might affect their commercial and compliance agreements. Crucial to this is verified emissions data, which can maintain operational and commercial integrity across the maritime value chain.”

The report provides recommendations for shipowners including securing long-term fuel agreements and implementing energy efficiency measures. It also recommends considering pooling as a mechanism for sharing and optimizing costs. This is underpinned by a call to begin preparations immediately. The report also highlights how, by leveraging digital tools, maritime stakeholders can access verified emissions data, a key factor in compliance and maintaining both operational and commercial integrity throughout the value chain.

A key point emphasized in the report is that the International Maritime Organization is also set to introduce similar regulations in the near future, with a net-zero framework expected to be adopted in the second half of 2025 and come into force around mid-2027.

Note: The full whitepaper titled ‘FuelEU Maritime: Requirements, compliance strategies, and commercial impacts’ by DNV can be downloaded here.

 

Photo credit: DNV
Published: 6 December, 2024

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