Rasmus Stute from DNV interviews Sameer Kalra, President of the Marine Division and Executive Vice President at Alfa Laval, on key industry trends including the company's innovative approach to the energy transition, emphasizing fuel-agnostic solutions, energy efficiency and close collaboration with third parties to meet future challenges:

We met recently at the SMM trade fair, always a really important date on the shipping calendar. What were your takeaways?

The first thing that stood out to me was that energy efficiency seems to be really high on the agenda, alongside LNG as an alternative fuel. Secondly, digitalization seems to be much more in focus than just a couple of years ago. This is why it is so great to come to these trade shows; you can hear what the industry’s talking about and it really helps to calibrate your own views.

At SMM, we launched our latest Maritime Forecast to 2050, which focuses on the building blocks needed for the energy transition in shipping. From Alfa Laval’s perspective how are you going to respond to the energy transition? Is this a significant challenge or something you’ve already anticipated?

The one thing that Alfa Laval is absolutely known for is being innovative from the beginning and that’s still part of the company’s DNA. So when we started working around decarbonization and the energy transition roughly five or six years ago, we took the position that as Alfa Laval we needed to put our money where our mouth was. And, instead of just telling others to decarbonize, we also set some goals for ourselves for 2030. Right now, we expect to meet our Scope 1 and 2 net zero targets ahead of schedule. (PS: After this interview took place, Alfa Laval announced an updated goal to achieve net zero in its own operations by 2027, covering Scope 1 and 2 emissions.) 

However, challenges remain, particularly supporting customers in areas outside our direct control, such as fuel choice. Shipowners have a tough challenge, finding a vessel design and choosing a fuel that is economically viable, commercially attractive and future-proof for the next 20–25 years. Recognizing this complexity early on, we positioned ourselves to support shipowners with versatile, future-ready solutions. In particular, one major initiative has been to ensure our product portfolio is fuel-agnostic. 

Additionally, we have prioritized the development of new platforms focused on energy efficiency. Another key step has been the acquisition of StormGeo, which, whilst unconventional for a company like Alfa Laval, aligns with our strategy to address the evolving energy efficiency and sustainability demands of the maritime industry. Ultimately, our commitment is to provide solutions that enable both immediate and long-term decarbonization goals.

You mentioned key elements like energy efficiency and fuel flexibility, and you have set up your company to address these challenges. Looking ahead to 2030, what do you envision will be your most important products to support customers with these trends?

It is challenging to be definitive about specific products, but we can identify trends. Our energy efficiency portfolio will play an increasingly important role, even more so than it does today. Transitioning to clean fuels will also grow in importance. If I were to highlight one area, it would be energy efficiency over the short term. 

Given the challenges in scaling up the supply of green methanol and ammonia by 2030, boosting energy efficiency becomes an essential, immediate necessity for the industry. At Alfa Laval, all three of our divisions – Marine, Energy, and Food and Water – will contribute to these efforts. In the near term, we will focus on enhancing energy efficiency in existing systems whilst introducing new, innovative energy efficiency platforms across our product portfolio to support our customers in navigating this energy transition.

I’ve a follow-up question on the energy transition. How do you feel about the role of carbon capture and storage in this process?

From our perspective, carbon capture and storage (CCS) is set to play an important role, particularly on the energy side. However, the role of onboard carbon capture specifically is less clear. These are two different challenges and we need to approach them with an open mind. For instance, it’s possible that LNG could be a transitional fuel that achieves a 20% reduction in emissions. If onboard carbon capture technology could add another 10–15% reduction on top of that, it might be a viable step forward. 

However, there are still many questions to address. We need to solve challenges related to the footprint of onboard carbon capture systems, as well as their cost-benefit ratios. These are critical factors that must be worked out before onboard carbon capture becomes a widespread solution. That said, I have confidence in the ingenuity of the maritime industry, and I am optimistic that we will find ways to overcome these challenges. 

And whilst there are still questions to answer, I firmly believe that carbon capture and storage, both on land and onboard, could make a significant contribution towards accelerating the energy transition.

Note: The full interview by DNV can be found here.

Photo credit: Venti Views on Unsplash
Published: 14 January, 2025

The maritime industry’s exceptional newbuilding year 2024 drove a significant rise in orders for alternative-fuelled vessels, according to the latest data from DNV’s Alternative Fuels Insights (AFI) platform.

A total of 515 such ships were ordered, representing a 38% year-on-year increase compared to 2023, underscoring the industry's growing commitment to decarbonization.

The growth in alternative-fuelled vessel orders has been heavily driven by the container and car carrier newbuild boom over the last three years. In 2024, 69% of all container ship orders were for ships capable of being powered by alternative fuels, driven by cargo owners responding to consumer demands for more sustainable practices and liner companies preparing to replace older tonnage. The preferred fuel choice for this segment was LNG (67%). In total the container and car carrier segments made up 62% of all alternative fuel orders in 2024. 

Knut Ørbeck-Nilssen, CEO Maritime at DNV, said: “As we work towards decarbonizing the industry, we are encouraged by the growth in alternative fuel vessels over the past few years. While recent figures are promising, we must keep pushing forward.”

“The technological transition is underway, but supply of alternative fuel is still low. As an industry we need to work with fuel suppliers and other stakeholders to ensure that shipping has access to its share of alternative fuels in the future. It is also important that the safety of seafarers is ensured as we make this transition. This will require investment in upskilling and training.”

LNG was not the only fuel on shipowners’ minds as 2024 saw them betting on multiple alternative fuels. 166 methanol orders were added (32% of the AFI orderbook), reflecting shipping’s growing interest in a diverse fuel pool as it strives to reduce greenhouse gas emissions. Most of these methanol orders (85) were in the container segment.

While methanol drove newbuilding orders for alternative-fuelled vessels at the beginning of the year, LNG was the industry’s alternative fuel of choice by year-end. The number of LNG vessel orders placed in 2024 was 264, over double that of 2023 (130).

Ammonia saw promising momentum in the earliest months of the year and continued to grow throughout 2024. A total of 27 orders were placed for ammonia-fueled vessels. The first non-gas carrier ammonia-fuelled vessels orders were placed in 2024 (10), mainly in the bulk carrier segment (5). While still in its early stages, this provides further evidence of ammonia's emergence in the alternative fuel market.

Deliveries and bunkering

The number of LNG-fuelled ships in operation doubled between 2021 and 2024, with a record number of deliveries (169) in 2024. By the end of 2024, 641 LNG-powered ships were in operation. According to the AFI orderbook, this number is expected to double by the end of the decade. 

While the bunkering infrastructure for some alternative fuels remains underdeveloped, LNG bunkering is maturing. The number of LNG bunker vessels in operation grew from 52 to 64 over the last year, with continued growth expected in 2025. The significant gap between LNG bunkering supply and demand is expected to widen over the next five years based on the AFI orderbook. 

Addressing this challenge by developing the appropriate infrastructure for alternative fuels – both for vessels and bunkering - can create demand signals to stimulate long-term fuel production. With the EU regulatory package, Fit for 55, setting requirements on a large network of ports to have LNG bunkering infrastructure, it is expected that the availability of LNG in ports will increase.

Jason Stefanatos, Global Decarbonization Director at DNV, said: “Market conditions, infrastructure development, fuel production updates, and cargo owners' needs are all shaping the demand for different fuels, both in the short and long term.”

“The shifting trends in LNG and methanol orders this year might be due to the slow development of green methanol production. In the long run, green methanol has potential to be part of the energy mix along with ammonia.”

“In parallel, LNG offers a vital bridging fuel option benefiting from existing infrastructure and short-term emissions reductions while being capable of acting as a long-term solution as well, assuming RNG (Renewable Natural Gas) will be available and provided at a competitive price.”

Photo credit: DNV
Published: 13 January, 2024

Dr. Prabath Weerasinghe, a Senior Lecturer of the Department of Electrical and Information Engineering Faculty of Engineering at University of Ruhuna, shared that analysts predict the country can generate about USD 5 billion annually from bunker fuel operations by 2030 with a focused investment and improvements to Jaya Container Oil Bank Terminal (JCT Oil Bank):

Sri Lanka, strategically positioned on one of the busiest maritime routes in the world, holds immense potential to become a leading regional bunkering hub. Experts suggest that with targeted infrastructure upgrades and strategic policy initiatives, the country can generate nearly USD 5 billion annually from bunker fuel operations by 2030. The key lies in revitalising the Jaya Container Oil Bank Terminal (JCT Oil Bank) to match regional standards and meet the growing global demand for efficient bunkering services.

The Jaya Container Oil Bank Terminal, once seen as a critical asset for Sri Lanka’s maritime economy, has faced years of neglect, underutilisation, and inadequate capacity expansion. Despite its strategic location adjacent to the busy Port of Colombo, the terminal operates well below its potential. Competitors like Singapore, Fujairah, and Indian ports have surged ahead, offering large-scale fuel storage facilities, efficient refuelling systems, and world-class operational infrastructure.

The lack of consistent investment, outdated technology, and limited storage capacity at JCT Oil Bank has deterred major shipping lines and bunker operators from considering Sri Lanka as their preferred choice for refuelling.

The USD 5 Billion Vision

With global shipping volumes projected to grow steadily, the demand for bunker fuel is expected to rise exponentially. Analysts predict that with focused investment in the JCT Oil Bank Terminal, Sri Lanka could capture a significant share of the Indian Ocean bunkering market, generating approximately USD 5 billion annually by 2030.

Key improvements required to achieve this goal include:

• Increased Storage Capacity: Expanding storage facilities to accommodate both conventional and sustainable fuels like LNG and biofuels.
• Enhanced Distribution Networks: Modernising fuel delivery systems to reduce refuelling times and increase efficiency.
• Policy and Regulatory Clarity: A transparent and investor-friendly policy framework to attract global players.
• Technological Upgrades: Adoption of digital systems to streamline inventory management and improve transaction transparency.

Regional Competition: The Need for Urgency

Regional competitors like Singapore have set benchmarks in bunker fuel supply, handling nearly 50 million metric tons of bunker fuel annually. Ports in India, UAE, and Malaysia are also scaling up their bunkering capacities with substantial government backing. If Sri Lanka delays infrastructure upgrades, it risks losing market share to these emerging competitors.

Government and Private Sector Collaboration

Achieving this ambitious target requires strong collaboration between the government and private sector stakeholders. Private investment in storage infrastructure, technology integration, and distribution systems will play a crucial role. Simultaneously, the Sri Lanka Ports Authority (SLPA) must ensure that red tape is minimised, and strategic policies are implemented effectively.

The International Maritime Organisation (IMO) has set strict emission targets for the shipping industry. As a result, the demand for clean fuels like LNG, biofuels, and green ammonia is expected to rise significantly. If Sri Lanka can position the JCT Oil Bank Terminal as a hub for sustainable fuel distribution, it will secure a long-term competitive advantage in the global bunkering market.

The Roadmap to 2030

• Short-term (2024-2026): Immediate expansion of storage capacity and improvement of refuelling facilities.
• Medium-term (2026-2028): Adoption of advanced technologies and digital systems for seamless operations.
• Long-term (2028-2030): Integration of sustainable fuel infrastructure and establishment of global partnerships.

Sri Lanka stands at a critical juncture. The Jaya Container Oil Bank Terminal is not just a piece of infrastructure—it represents a multi-billion-dollar economic opportunity. With the right mix of policy direction, strategic investment, and sustainable practices, Sri Lanka can re-establish itself as a leading bunkering hub in the Indian Ocean.

If the government prioritises the revival and expansion of the terminal, the country could unlock an annual revenue stream of USD 5 billion by 2030, boosting foreign exchange reserves, creating employment opportunities, and driving long-term economic stability. The time to act is now—delays will only allow regional competitors to widen the gap further.

Photo credit: Chathura Anuradha Subasinghe on Unsplash
Published: 9 January, 2025