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