Challenges of adopting biofuel as part of shipping’s decarbonisation drive were amongst topics discussed by expert panelists at the VPS Biofuels Seminar in Dubai on Thursday (16 March).
The session found local United Arab Emirates-based players already engaging in respective emission reduction trials before IMO 2030 – with many arriving at their own set of conclusions.
ADNOC L&S – Embracing biofuels in the ‘year of sustainability’
Eng Khalid Al Shehhi, Marine Projects Manager, ADNOC L&S noted the maritime logistics arm of ADNOC Group already adopting biofuels for certain commercial operations on the back of “very successful” biofuel trials completed earlier in 2020.
He noted relationship with OEMs as key to supporting ADNOC L&S’ plan of using B20 biofuel; however, the company eventually decided to commit to B5 biofuel even though vessels initially passed B20 trials.
“One of the primary challenges in adopting alternative fuels [biofuel] is the high cost when compared to conventional fossil fuels. As a consequence of our biofuel trials, we determined B5 blend as being more suited for our operating model and emission reductions aim,” he said.
Eng Khalid noted 2023 to be the “year of sustainability” for the UAE due to the upcoming 28th Conference of the Parties to the UN Framework Convention on Climate Change (COP28) to be held in the region.
“Our efforts at ADNOC L&S are motivated by ADNOC sustainability targets for 2030 and IMO future emissions reduction targets; for this, we are investigating viable decarbonisation alternatives, with biofuels serving as a viable drop-in option.”
Gulf Energy Maritime – Alternative marine fuels ‘a gamble’ for shipowners
Rajeev Gupta, Head of Fleet, Gulf Energy Maritime (GEM) said shipowners such as themselves are facing challenges sourcing for alternative bunker fuels even though the sector has been focusing on decarbonisation.
“It's not an easy decision selecting the engine for a newbuilding today but I would probably go for a dual fuel LNG engine just because there is some infrastructure for bunkering LNG,” said Rajeev.
“As Eng Khalid mentioned, cost is certainly an issue and it's not an easy decision for an operator to take that extra cost because the charterers are not going to pay extra for more expensive bunker fuel.”
He noted methanol to be a marine fuel favouring chemical tankers but showed apprehension to ammonia being used as a bunker fuel due to its potential dangers.
“It’s a multi-faceted problem and there are no quick solutions that are cheap and easily available; so, I would say it’s a gamble,” highlighted Rajeev.
“IMO is implementing the regulation but the governments and port states are still far behind in implementing the infrastructure to be able to provide these fuels.
“Unfortunately, the owners become the guinea pigs of having to comply with the regulation, install an engine, but then go searching around the world for suitable fuel.”
Cockett Marine Oil – Biofuels a ‘chicken and egg’ situation
Colin Holloway, Global Head-Technical, Cockett Marine Oil meanwhile noted the firm experiencing a lack of mainstream demand for alternative bunker fuels, including biofuels, but believed marine fuel suppliers will gladly provide avails when enquiries increase.
“I think we’ve already got the idea that it’s a chicken and egg situation. To be honest, to date, we don’t see very much enquiries for biofuel in the UAE and because of that, there’s probably not much availability,” shared Holloway.
“There are a few minor suppliers that are supplying biofuel by truck where you can purchase biodiesel [i.e. B5, B15, etc] but in the interim we can say demand for biofuels have not picked up in the main stream bunker business.
“There is availability for biofuel but not on the scale that is probably needed at this time. However, I am sure the trading companies will supply when demand hits and especially when EU regulations bite from 2024 onwards.”
Mideast/Bahri Ship Management – Adopting a ‘wait-and-see’ approach towards biofuels
Hendrik Atsma, Snr Manager, Mideast/Bahri Ship Management, noted the company has currently applied a wait-and-see approach towards the adoption of biofuels as bunkers for its fleet.
Though certain countries have been implementing subsidies to assist local shipowners in adopting biofuels for their fleets, Atsma felt biofuels do not present a complete solution towards decarbonisation due to potential environmental issues such as deforestation. So, footprint and fingerprint of biofuels sources will be important.
“We do our research for biofuels and are also in talks with engine makers and bunker suppliers,” he said.
“At some point, we even had the idea of starting a trial although unfortunately we decided not to go ahead because of liability issues. We will wait and see what some of the other major players are doing.”
VPS – Biofuel carriage misalignment of flag states, port authorities present hurdle
Captain Rahul Choudhuri, Managing Director for Asia, Middle East & Africa (AMEA) at VPS, who was moderating the session, called attention to the current misalignment of biofuel policies between flag states and port authorities as a hurdle for its adoption as a marine fuel.
IMO’s Marine Environment Committee in June 2022 approved a new Unified Interpretation (UI) on the application of regulation 18.3 MARPOL Annex VI in relation to biofuels, allowing biofuel blends up to B30 be regarded in the same way as regular oil-based fuels.
“The current MARPOL Annex II allows carriage of up to 24% FAME; however in principle, if you’re above that limit, then as a bunker tanker or bunker barge, you can’t carry it unless you have a chemical tanker notation,” explained Captain Choudhuri.
“Whereas for example, Singapore has implemented a biofuel standard called the WA 2:2022 which allows carriage of up to 50% FAME.
“That brings the position of flag states into play because at the moment vessels, owners and operators need flag state approval before they carry and burn biofuel. This means though Singapore is fine with its bunker tankers and flagged vessels burning biofuels, the other flags might not be agreeable.
“There’s a need for MARPOL, port authorities and flag states to align respective policies, including the Life Cycle Assessment (LCA) & CII (Carbon Intensity Indicator) on the carriage of biofuels because this difference will be a potential hurdle when the product becomes a mainstream bunker fuel.”
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Photo credit: VPS
Published: 22 March, 2023
Decarbonisation2 weeks ago