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SEA LNG: Compare ‘apples with apples’ to cut emissions and costs

Ship owners will lock in higher emissions and cost decarbonisation pathways if they choose alternative fuels which will not be available at commercial scale in near future.

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Global multi-sector industry coalition SEA-LNG on Thursday (7 July) released a framework for comparing the emissions and cost implications of adopting future fuel pathways and urges the industry to make like-for-like comparisons when discussing alternative marine fuels. It believes LNG as a marine fuel delivers immediate GHG benefits and a lower risk, lower cost, incremental pathway to zero emissions:

The industry is making newbuild investment decisions now that will impact greenhouse gas emissions today and for the next 25-30 years, the typical lifetime of a vessel. It is essential their assessments of alternative marine fuel pathways are made on a like-for-like, or “apples with apples” basis. Discussion of alternative fuels too often compares the green versions of ammonia and methanol with fossil, or grey, LNG. The reality is that all fuels share a common pathway from fossil-based versions, produced from natural gas to hydrogen-based, synthetic fuels. These synthetic fuels will only become available as and when sufficient renewable electricity and electrolysis capacity comes online to produce them.

Decarbonisation will not be a “big bang” process where the industry moves in a single step from fossil to zero-emission, renewable fuels. It is likely to take place incrementally as fuels are gradually decarbonised through the addition of low and zero-emission drop-ins.

Shared fossil feedstocks

This transition pathway is illustrated in Figure 1. Almost all alternative fuels today, including LNG, are fossil-based, in fact most are produced from natural gas. LNG is simply natural gas that has been cooled to the point it liquefies. Natural gas, and sometimes coal, is also the feedstock for almost all methanol, ammonia and hydrogen production.

Uniquely, fossil LNG offers significant greenhouse gas emissions reduction when used as a marine fuel compared with VLSFO – up to 23% on a full lifecycle (Well-to-Wake) basis according to an independent study by Sphera . By contrast, the use of fossil methanol, ammonia and (liquid) hydrogen results in emissions far higher than those associated with VLSFO because of the large amounts of energy required for their production.

A biofuel market

Emissions can be significantly reduced through the use of fuels derived from sustainable biomass. BioLNG is already commercially available in Europe as a marine bunker fuel today and has penetrated the heavy-duty vehicle road transportation sector in both Europe and North America. Biomethanol also exists in limited quantities, but mainly as an industrial chemical feedstock.

The ultimate, zero-emissions destination for all alternative fuels is for them to be synthesised from hydrogen produced from renewable electricity. Once this renewable hydrogen building block exists at scale it is possible to produce e-LNG, e-methanol, e-ammonia or e-hydrogen. It is important to note that around 70% to 80% of the cost of producing these e-fuels is associated with hydrogen production

We need to consider the pathway, not simply the destination

The implications for the climate and for shipowners can be best understood by looking at an example of investment decision. In Figure 2 we illustrate the case of a 14,000 TEU container vessel coming into operation in 2025, dual-fuelled with a 25-year lifespan and with renewable fuels becoming available at increasing scale from about 2030 onwards.

SEA LNG: Compare ‘apples with apples’ to cut emissions and costs

Modelling the emissions over the life of the vessel we can see that LNG offers immediate GHG reductions decreasing to zero-emissions by 2050. The bar chart shows an overall emissions reduction for the LNG pathway of more than 50% over the lifetime of the vessel, compared with VLSFO; for methanol and ammonia the corresponding reductions are 37% and 28%.

If we now look at the methanol and ammonia pathways, they also offer lifetime emissions reductions, but the reductions are smaller – 37% and 28% respectively – as they start from a “worse” place. Fossil methanol emissions are 14% higher than VLSFO on a full lifecycle basis; for ammonia the corresponding number is 47%. This is likely to mean owners and operators choosing methanol and ammonia pathways will be forced to continue using VLSFO, postponing emissions reduction for several years.

For methanol and ammonia to achieve emissions parity with LNG they will require blends of approximately 30% renewable methanol and 50% renewable ammonia immediately. The fossil versions of methanol and ammonia are already significantly more expensive than LNG and the renewable versions are likely to cost multiples more than their fossil equivalents. This will make the starting points for these pathways considerably more expensive than beginning with LNG. Note, this ignores any indirect costs associated with creating new bunkering infrastructure, which will be necessary for e-methanol, e-ammonia and e-hydrogen.

Waiting is not an option

In summary, committing to solutions which rely on alternative fuels which will not be available at commercial scale in a renewable form for the foreseeable future, means owners locking in higher emissions and higher cost decarbonisation pathways. LNG as a marine fuel delivers immediate GHG benefits and a lower risk, lower cost, incremental pathway to zero emissions.

Steve Esau, Chief Operating Officer, SEA-LNG said: “When looking at the advantages and disadvantages of alternative fuels, we should be assessing the characteristics of each fuel type on a like-for-like basis. Greenhouse gases in the atmosphere are a stock problem as well as a flow problem. The industry needs to consider the pathway to decarbonisation, not just the destination. Waiting is not an option.

“The consequences of delaying the shift away from fuel oils, which will cause faster rising cumulative emissions, meaning the challenge to reduce atmospheric greenhouse gases will be harder. Shipping needs to assess fuel pathways based on how they can deliver decarbonisation benefits now, and in the future, and also the likely cost to society of these pathways”.

 

Photo credit: SEA LNG
Published: 8 July, 2022

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Biofuel

GoodFuels ceases bio bunker fuel deliveries in Singapore after near three-year run

‘Whilst the GoodFuels team will continue its efforts to decarbonise global shipping from the Amsterdam office, we will be stopping all biofuel deliveries in Singapore with immediate effect,’ says Jing Xieng Han.

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Biofuel supplier GoodFuels, FincoEnergies’ sustainable fuels brand, has stopped all biofuel deliveries in Singapore with immediate effect, according to Jing Xieng Han, General Manager of GoodFuels Asia Pacific, on Wednesday (6 November). 

GoodFuels first announced the opening of its first office in Singapore in February 2022. The Singapore office was GoodFuels’ second office and its first outside of Europe. 

At the time, GoodFuels said Singapore was chosen as the target for its first international expansion because of its importance to the global shipping industry and its leading position as a key bunkering hub, with mature bunkering infrastructure that will support the delivery of marine biofuel.

Jing said FincoEnergies has decided to consolidate GoodFuels operations in the Asia Pacific and ARA regions. 

“Whilst the GoodFuels team will continue its efforts to decarbonise global shipping from the Amsterdam office, we will be stopping all biofuel deliveries in Singapore with immediate effect,” she said in a social media post. 

“Our Amsterdam team remains dedicated to furthering the decarbonization of global shipping 'the Good Way' and I wish them continued success.”

Jing also announced that she will be departing GoodFuels Asia Pacific, effective 6 November as well. 

“It has been a privilege to contribute to the integration of biofuels into the bunkering sector in Singapore over the past three years,” she said.

“The rapid evolution of the industry has been mind-blowing, and I fondly recall addressing numerous queries on the technical feasibilities of biofuels as bunker fuels when I first launched our Singapore office in early 2022.”

Related: GoodFuels opens first Singapore office to meet growing biofuel demand

 

Photo credit: GoodFuels
Published: 7 November, 2024

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Biofuel

Chimbusco Pan Nation completes first B24 bio bunker fuel delivery in Singapore

CPN supplied 1,000 metric tonnes of ISCC-EU Certified B24 marine biofuel for “YM WITNESS”, a containership of Yang Ming Marine Transport Corp on 16 October.

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Chimbusco Pan Nation completes first B24 bio bunker fuel delivery in Singapore

Hong Kong-based marine fuel oil supplier Chimbusco Pan Nation Petro-Chemical (CPN) on Wednesday (6 November) completed the supply of 1,000 metric tonnes of ISCC-EU Certified B24 marine biofuel for YM WITNESS, a containership of Yang Ming Marine Transport Corp on 16 October. 

“This also embarks on CPN’s new journey to arrange supplying marine biofuel in Singapore,” the firm said in a social media post. 

B24 marine biofuel is a blend of 24% B100 biodiesel and Marine Fuel Oil, which significantly reduces carbon emissions and lowers its carbon footprint. Such product aligns with global efforts to combat climate change and reduces environmental impact. 

“CPN is committed to be the frontrunner in the transition towards more sustainable marine fuel options. This biofuel delivery reinforces CPN’s commitment to realizing eco-friendly port energy solutions and global decarbonisation goals,” it added. 

 

Photo credit: Chimbusco Pan Nation Petro-Chemical
Published: 7 November, 2024

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LNG Bunkering

Titan completes LNG bunkering operation in Port of Zeebrugge

Titan supplied newly built PCTC “Peony Leader” using bunkering vessel “Optimus”, marking the PCTC’s maiden LNG bunkering operation.

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Titan completes LNG bunkering operation in Port of Zeebrugge

LNG bunker fuel supplier Titan on Wednesday (6 November) said it has completed a LNG bunkering operation in the Port of Zeebrugge. 

Titan supplied the newly built Peony Leader Pure Car and Truck Carrier (PCTC) using Optimus – one of its LNG bunkering vessels (LBV).

“This was the maiden voyage for the Peony Leader, as well as the first time it bunkered LNG while in service. The Optimus’ crew closely supported throughout the process, providing guidance and information to the seafarers onboard the vehicle carrier,” it said in a social media post. 

“Our commercial team also visited CSP Zeebrugge to meet the new client, Chimbusco. With a greatly increasing number of PCTC newbuilds being LNG dual-fuelled, we look forward to many more successful LNG bunkering operations with Chimbusco and other shipowners in this segment.”

 

Photo credit: Titan
Published: 7 November, 2024

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