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Interview: IBIA to intensify all marine energy related stakeholder activities, says new Chairman

Constantinos Capetanakis, Bunker Director at Star Bulk Carriers Corporation, updates Manifold Times the changes he will be implementing for IBIA during his tenure as its new Chairman.

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Constantinos Capetanakis, Chairman of IBIA

The International Bunker Industry Association (IBIA) will be intensifying its exposure on all fronts under the new leadership of Constantinos Capetanakis, Bunker Director at Star Bulk Carriers Corporation, learns Manifold Times.

Capetanakis recently took over Timothy Cosulich as Chairman of IBIA for a period of two years effective 1 April 2024.

“IBIA is already undergoing a series of changes the past few years. So, during my term, these changes will continue and will increase so that IBIA acquires even more visibility worldwide than it already has,” he told the bunkering publication.

“And by visibility, I mean IBIA will become even more vocal in all activities not only in the International Maritime Organization (IMO), which is our number one priority, but also in other well-known international corporations with which we already do business with, as well as in new partnerships which we intend to form and in events we will be participating.”

According to Capetanakis, IBIA plans to intensify cooperation with all partners in Singapore, China, Europe, the United States, Middle East, and more.

“What I will focus on more is further diversification of IBIA’s membership because we want IBIA to embrace all marine energy stakeholders from all countries whether they have a direct or indirect relationship with marine fuels and not have limits as to who can join IBIA,” he shared.

To date, IBIA has already set up regional board in Asia, Africa, and the Americas. Its latest Middle East regional board was established in November 2023, and the organisation is planning to establish its final regional board in Europe within 2024.

“The creation of the last regional board in Europe will create a vast network for our membership,” stated Capetanakis.

“IBIA is a membership organisation offering specific advantages; the obvious one is the consultative status IBIA has within the IMO where we can suggest interventions on behalf of members and the bunkering industry.”

Recent interventions which IBIA participated are:

  1. MEPC 81/7/15 (Australia, Denmark, France, Germany, Greece, Japan, Netherlands (Kingdom of the), Norway, ICS, EDF, IBIA, INTERCARGO, INTERTANKO, IPIECA, IWSA, Pacific Environment, RINA, SGMF, WSC and ZESTA) Establishment of an IMO expert group on life-cycle assessment of marine fuels.
  2. MEPC 81/INF.12 (IBIA) Sampling of low-flashpoint fuels supplied to ships for use on board as fuel (MEPC 81, 18 to 22 March 2024) This document provides information on a method developed for the sampling of low-flashpoint fuels (methanol) supplied to ships for use on board as fuel. The proposed method seeks to address the critical need for safety and efficiency in handling low flashpoint fuels during bunkering operations.
  3. ISWG-GHG 16/2 (ICS and IBIA) Revised possible draft amendments to MARPOL Annex VI to implement a simplified Global GHG Fuel Standard (GFS) with an energy pooling compliance mechanism.
  4. MEPC 81/INF.4 (IBIA) Carriage of biofuels for supply to a ship for use as fuel oil on board that ship. MEPC 78 in June 2022 agreed that biofuel blends up to 30% biofuel (B30) could be regarded in the same way as regular oil-based fuels and also that engines certified to do so could use biofuels from B30 to B100 i.e., 100% biofuel. However, IBIA notes that ships engaged in bunkering operations and certified under MARPOL Annex I cannot carry biofuel blends with >24% biofuel even within port waters.
  5. Other IMO related activities - Red Sea – bunker activity report for Africa. Following a request received from IMO, a bunker activity report for Africa has been prepared and posted by both IBIA and IMO: https://www.imo.org/en/MediaCentre/HotTopics/Pages/Red-Sea.aspx

Further, Capetanakis notes IBIA has working groups ranging from digitalisation, future fuels, mass flow meters, technical, and more for all members to participate, exchange knowledge, and present concrete projects, while its regional boards allow stakeholders to express local concerns and activate advocate them.

“IBIA is a place where people can meet, discuss, analyze, intervene, and affect policy because at the end of the day you want real changes to be applied. By strengthening IBIA’s membership, we can be more effective in becoming an even stronger pressure group,” he explained.

“Any IBIA member can be within the centre of developments and take action either in a working group, regional board, or a committee to shape policy.

“We also offer members speaker positions at events, in addition to editorial contribution opportunities at our inhouse magazine for them to speak their mind. Coming up, let’s not forget our upcoming Singapore Dinner in April, plus our Annual convention in Athens in November, both of which events are expected to be massively sold out”

Moving forward, Capetanakis believes his background has prepared himself to be the right man to lead IBIA as Chairman for the next two years.

“I represent a dry bulk shipping company and my company Starbulk Carriers is one of the largest dry bulk shipping companies in the world and listed in the New York Stock Exchange. We are buyers of a substantial volume of bunkers, buying close to 1 million metric tonnes of fuel every year,” he said.

“Being on the buying side, you get to cooperate with a wide network of suppliers, fuel producers, fuel experts, and other stakeholders as well. So, I'm in an ideal position to grasp all the various elements that IBIA needs to focus on, on our way to decarbonisation.

“I also believe my legal background as an English solicitor and a Greek lawyer enables me to grasp the fine details that are needed for IBIA’s narrative to become clearer and encompassing, both to the membership we want to approach but also to the wider public. I think the message will be passed on clearly and I hope I will be able to contribute to that.”

Related: Fratelli Cosulich: Timothy Cosulich named as IBIA Chairman, starts role effective April

 

Photo credit: International Bunker Industry Association
Published: 2 April 2024

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Methanol

Singapore: Industry expert clarifies rising misconception of methanol bunker fuel carbon intensity

Several industry stakeholders have expressed difficulties in meeting the stated carbon intensity of 90 gCO2e / MJ outlined by the Maritime and Port Authority of Singapore.

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RESIZED AND ADJUSTED Chris Chatterton (1)

A misconception by parties keen on supplying methanol as a bunker fuel at Singapore port is rising and needs to be addressed, observed methanol industry expert Chris Chatterton.

The Maritime and Port Authority of Singapore (MPA) on December 2023 issued the Expression of Interest (EOI) for the supply of methanol as a marine bunker fuel in the port of Singapore document to the bunkering sector.

In it stated: “The Participant shall propose methanol product(s) with a carbon intensity (CI) not greater than 90 gCO2e / MJ (well-to-wake) for bunkering in Singapore”.

Several industry stakeholders have expressed to Chatterton difficulties in meeting the stated CI of 90 gCO2e / MJ due to conventional grey methanol produced using current modern methods having a CI of between 90 to 95 gCO2e / MJ, or even higher in some cases, on a life cycle assessment basis.

Further, the parties were concerned of significant higher costs when considering the premium between fuel oil (HFO and LSFO) and more expensive green [carbon neutral] methanol.

“Guys, don’t sweat the premium! When we talk about green methanol in premiums, we are referring to 100% green methanol here and nobody is going to burn this product in commercial operations due to costs unless it is economically viable under prevailing policy or they are able to transfer these costs to cargo owners,” he exclaimed.

“Questions persist on how to meet the CI specification and some players are wondering if the methanol can be blended or needs to come direct unchanged from the manufacturing complex. This needs to be addressed but is technically very simple to do.”

Chatterton recommends the bunkering industry to utilise the Mass Balance Approach – a concept familiar with the chemical industry – which traces the flow of materials through a supply chain as a compliant method to lower the specific CI content of methanol for use as marine fuel (combusted).

Source: International Sustainability & Carbon Certification (ISCC)

Source: International Sustainability & Carbon Certification (ISCC)

“Not all methanol production plants are created equal and when you purchase methanol you are going to get a CI certificate stating the carbon dioxide (CO2) equivalent per Megajoule (MJ) from well-to-plant gate basis,” he informed.

“And just by blending the certified grade with a portion of green carbon neutral methanol you can effectively lower the CI value of conventional conventional methanol to meet the 90 gCO2e / MJ specification required by MPA.

“Singapore is an ideal hub to receive and trade varying specifications of certified grey, blue and green methanol from not only China, Middle East, but from any corner of the world, efficiently and cost-effectively."

Availability of green carbon neutral methanol from China

Globally, “pilot” production projects are expected to produce over 6 million metric tonnes (mt) of green methanol in 2025, with up to 4 million mt coming from China, stated Chatterton who added a large portion of China’s green methanol will be derived from wind power, which is arguably the lowest cost wind resource with the highest capacity factor globally.

“Northeast China has a very high onshore wind capacity factor at above 95% which is amongst the best in the world and enough to provide baseload power rivalling utility scale gas fired powerplants,” he explained.

“China is also a world leader in renewable power production, whether solar or wind by a factor of two and has more than twice the renewable power capacity than USA.

“Further, China is the largest producer of renewable power equipment of any kind in the world and by far also the cheapest because they produce at scale; whether it’s wind towers, rotor blades, turbines, or solar panels - China is the outright leader in production capacity and has been so for many years.”

Most of China’s pilot scale projects set to produce green methanol are already in the final investment phase. To date, pilot projects in operation could only produce between 100,000 to 200,000 mt of green methanol per annum, and low volumes have resulted in higher prices for the green material.

However, once scaled up, these pilot projects will be able to produce 2-3 times more product to eventually lead to a softening of market pricing for green methanol, noted Chatterton.

Future prices and procurement of green methanol

“Therefore, there is no need to be too worried about the current methanol premium over HFO. There are certainly organisations able to provide methanol at more flexible terms, but these term contracts typically are for a longer duration,” he continued.

“A similar development took place for shipping’s transition to IMO 2020, when all majors instructed bunker suppliers needed to enter into long term contracts for at least a year to secure 0.50% sulphur limit VLSFO.”

Moving forward, Chatterton believes the combined factors of increased availability of green methanol, more efficient renewable power and power equipment cost structures, resulting in economies of scale will mean more affordable methanol from 2025 onwards – particularly from China.

“The green methanol producers in China are mainly pursuing ISCC EU certification which means it is compliant for use in Europe. With FuelEU kicking in, it will be even more ideal for shipowners to switch to using lower carbon and carbon neutral methanol as a sustainable marine fuel,” he ends.

Related: MPA receives 50 submissions for EOI to supply methanol bunker fuel in Singapore
Related: MPA issues EOI seeking for methanol bunker fuel suppliers in Singapore

 

Published: 20 May 2024

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Interview

Foreship: Energy density and safety aspects of alternative marine fuels must be addressed in future ship designs

‘Methanol-ready’ term has been overstretched to include ships which are far from ready for the alternative marine fuel, Jan-Erik Räsänen, Chief Technology Officer, Foreship tells Manifold Times.

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Foreship: Energy density and safety aspects of alternative marine fuels must be addressed in future ship designs

The increasing use of alternative marine fuels due to IMO 2030/2050 regulations is creating challenges that ship designers still need to overcome, according to Helsinki-based ship design and engineering specialist Foreship.

“’Future proof design’ is one of the key words of the shipping industry these days,” Jan-Erik Räsänen, Chief Technology Officer, Foreship told bunkering publication Manifold Times.

“While clearly still challenging, designing ships for lower emissions was more straightforward in the early days because it involved heavy fuel oil (HFO) and marine gas oil (MGO); their superior energy density and relatively high flash point offer great flexibility when designing ships.

“However, while alternative bunker fuels are a good thing due to their lower emissions, they also come with challenges. Ship designers have to consider the energy density, energy content and, due to their low flash points, these fuels must be accessed and stored in separate tanks.”

Foreship 14 Large format

Challenges of marine engine retrofits to use methanol and LNG

The option of retrofitting vessel engines to use alternative marine fuels such as methanol and liquified natural gas (LNG) also pose their own set of issues, highlights Räsänen.

“Today most shipowners thinking about a retrofit probably consider methanol as their starting point; for ship designers the methanol is a good bunker fuel as it offers flexibility in choosing between different storage tank locations on a vessel,” he explained.

“However, one of challenges for methanol is the need to do more structure-wise when compared to traditional bunker fuels such as HFO and MGO. Designers must strengthen the hull to cope with additional weight from the weight and introduction of cofferdams; containerships will most likely lose cargo space as a result of the conversion.

“Foreship has already done several conversion designs for cruise ships to use methanol, and the conversion can be more straight forward than some might expect, with double bottom tanks and ballast water tanks used to store the bunker fuel. However, doing so comes at a cost - structure-wise.”

Räsänen points out that classification societies also offer initial thoughts on engine retrofit plans to consume methanol. Additionally, engine manufacturers such as Wärtsilä and MAN offer retrofit kits for their own two-stroke engines to simplify the process.

“As such, today we usually ask shipyards to strengthen the hull to accept alternative bunker fuel,  ,”  Räsänen noted, although he expressed reservations on the use of LNG as a future marine fuel. “We are debating heavily on methane slip especially on four-stroke LNG engines,” he said.

‘Methanol-ready’ term overstretched

Moving forward, Räsänen felt the term ‘methanol-ready’ has been over-used, at a time when its definition has not been standardised by class societies.

In general, to secure approval-in-principle (AiP) status as a ‘methanol-ready’, ship owners must agree that a certain number of vessel modifications need to be  carried out so that the ship can consume methanol as a bunker fuel.

However, shipowners can secure the in-principle approval before all of the modifications are carried out, with the ship notated as ‘methanol-ready’ on the basis that it is on the right path.

“This is a departure from the ordinary understanding of what it means for something to be ‘technology-ready’, said Räsänen. “Given what is at stake, it’s essential that these terms aren’t vulnerable to being considered gimmicks.”

Potential risks included ship managers taking a vessel on long term charter on the grounds that it was ‘methanol-ready’ when a full evaluation of its conversion had not been undertaken.

“This AiP has varied between different class societies, and I’d say there certainly needs to be standardisation on what ‘methanol-ready’ notation means – as a matter of priority .”

 

Photo credit: Foreship
Published: 7 May 2024

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LNG Bunkering

SEA-LNG: LNG as bunker fuel ‘misunderstood’, methane slip issue ‘completely overplayed’

Esau clarifies all other alternative marine fuels have worse well-to-wake emissions when compared to LNG on an even playing field.

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Chief Operating Officer of SEA-LNG Steve Esau

The use of liquefied natural gas (LNG) as a bunker fuel, which started out strongly as a transitional fuel for supporting shipping’s decarbonisation initiative, has gradually been misunderstood due to misinformed marketing campaigns, believes the Chief Operating Officer of SEA-LNG.

“This methane slip issue has been completely overplayed by certain players and environmental groups,” Steve Esau told bunkering publication Manifold Times.

“Depending on who you talk to, they cherry pick data from LNG engines which are between 10-15 years old and don’t make allowances for LNG engine technology which is developing.”

According to Esau, the LNG industry recognises methane slip and has developed engines which effectively have no methane slip; these engines already make up for more than 50% of the current orderbook.

Current low pressure LNG engines, however, still suffer from reduced greenhouse gas (GHG) emissions. As such, the LNG industry has banded together to create the Methane Abatement in Maritime innovation initiative (MAMII) in 2023 to develop even more solutions to deal with methane emissions.

“In the first year of operation, MAMII is looking at how to measure methane slip accurately. Now, they are at technology scanning phase to evaluate various technologies to calculate and verify methane slip,” he shared.

Esau, meanwhile, clarified all other alternative marine fuels have worse well-to-wake emissions when compared to LNG on an even playing field.

“All bunker fuels including LNG share a common pathway to decarbonisation where you start first with fossil-based, followed by bio, and then ‘e’ versions,” he explained.

“When people talk about alternative marine fuels they often speak of the blue or green versions and compare these versions with grey LNG – which is not comparing apples to apples.

“That’s the frustrating thing.”

Moving forward, Esau notes the timeline for ‘e’ fuels such as renewable synthetic LNG, chemically identical to fossil LNG, to be similar with ‘e’ versions of other alternative marine fuels.

“The end road for all fuels, including LNG, are e-fuels; it’s all about producing the green hydrogen which takes up between 70% to 80% of the cost for electric fuel. With it, you can produce whatever you like,” he concludes.

 

Photo credit: SEA-LNG
Published: 29 April 2024

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