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The Society for Gas as a Marine Fuel (SGMF) releases Guidelines for LNG as a Marine Fuel

Monday, 17 November 2014 | 00:00
The newly-established Society for Gas as a Marine Fuel (SGMF) has released its guide for the use of LNG as a Marine Fuel. Among the info provided, it's worth noting that car ferries currently (mid 2014) make up most of the LNG-fuelled fleet. They account for 21 out of 41 (51%) of the vessels in operation and 10 out of 38 (26%) of the vessels on order.

Offshore support vessels (OSVs) make up the second largest contingent at 29% and 18% respectively. A variety of other ship types are in service, including marine patrol vessels, tugs, product tankers and general cargo ships.

LNG bunkering facilities
LNG is available for marine fuel use in the European ports of Antwerp, Amsterdam,  Rotterdam, Stockholm and Zeebrugge. LNG can also be bunkered at the Norwegian ports of
Bergen, Florψ, Karmψy, Oslo and Risavika/Stavanger. In most cases this is by road tanker; however in Bergen there is a dedicated terminal and Stockholm has a bunker vessel called Seagas that provides LNG fuel. Ports in Finland, Italy and Spain have also loaded LNG as bunker.

All these ports are able to offer LNG to prequalified vessels that are compatible with the LNG-loading infrastructure. EU policy is to have at least one LNG bunkering port in each
member state. About 10% of European coastal and inland ports will be included, a total
of 139 ports. Coastal port LNG infrastructure will be completed by 2020 and for inland ports by 2025. To date Denmark, Estonia, Finland, France, Germany, Norway, Spain, Sweden and the UK are considering where to locate LNG bunkering facilities.

There are several ports under development in North America, mostly in the Gulf of Mexico and around the Great Lakes, but also for ferry operations on the west coast South Korea is able to offer LNG bunkering in the port of Incheon and is looking at a second facility at Busan. Elsewhere in Asia, Singapore, Japan and China are looking at LNG bunkering facilities.

Projections for the future
There is no question that LNG as a marine fuel has arrived; what we have yet to see is
how large the industry will grow to and how quickly. The industry has made several forecasts but as yet there is little alignment between them. Lloyds Register provided a detailed review of the potential growth scenarios in 2012. Its optimistic scenario predicted about 2,000 ships by 2025. This would be an average of about 150 ships per year, significantly more than the
14 ships delivered in 2013 and the 22 ships expected in 2014. Most of the growth in the Lloyds Register scenario takes place after 2020, when the IMO is proposing to impose worldwide sulphur reductions.

DNV GL’s latest forecast (2014) appears to extrapolate from recent deliveries and so predicts  higher gas-fuelled ship numbers early, growing to a total of 3,200 vessels by 2025. Other commentators have looked at the overall size of the fuel market and at how gas-fuelled ships would impact the global, bulk LNG business. Most of these forecasts are significantly
less optimistic than the DNV GL fuel forecasts. Most commercial commentators – including Poten & Partners, Wood Mackenzie, CERA and Total – predict 20 – 30 mtpa of LNG by 2030. This would require about a 10% growth (20% for the most optimistic scenario) in today’s LNG production just for fuel use. LNG industry commentators such as BG Group are
already suggesting that the LNG business will be supplyconstrained for its traditional business model over this period.

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Source:  Society for Gas as a Marine Fuel (SGMF)
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