BY R. Bruce Striegler
With the December UN Climate Change Conference in Paris, many countries are developing and implementing plans to transition towards low-carbon economies. None are more serious than Norway. At the beginning of this year, agreements were concluded between several Norwegian government departments and the nation’s shipping industry, designed to make the country’s fleet of coastal vessels the world’s most environmentally friendly.
The Norwegian Embassy in Ottawa and the B.C. Chamber of Shipping recently sponsored a Green Shipping Seminar in Vancouver. Panel member Ms. Ida Skard, Director General, Maritime Department of the Norwegian Ministry of Trade, Industry and Fisheries began by saying “I’d like to emphasize the importance of the oceans, the coasts and the maritime sector both for Norway and Canada.” Ms. Skard recognized the shipping industry as one of the most efficient and green modes of transportation, but says the sector will come under even greater scrutiny, requiring governments, ports and shipping companies to increase their focus on ways to improve the sustainability of the shipping life-cycle. “In order to meet the future challenges and environmental demands, the industry must balance its role as an enabler of global trade with the obligations of an improved environmental future. I feel we can benefit from sharing our expertise and knowledge and work together, so perhaps this seminar is a beginning.”
Growing shift away from heavy oil to LNG for ship’s fuel
Norway’s Green Coastal Shipping Program, one step to implement the country’s new maritime strategy, is a critical component in achieving its national climate goals and reducing air pollution. At the same time, the Norwegian government expects it will drive innovation and green workplaces. In time, it is expected to provide major export opportunities for maritime, energy and supplier industries. LNG and new battery technologies are anticipated to take the lead in fuels powering the global fleet of the future, and Ms. Skard says, “The Norwegian shipping sector is leading in the development and utilization of new fuel technologies such as LNG. Focussed on improving energy efficiency these technologies offer major competitive advantages including cost-savings and environmental enhancements.” Ms. Skard says that by the end of June, the Norwegian government will present the entire comprehensive policy around the country’s maritime strategy, and that green shipping will be a key topic
Dr. Gerd Würsig, Fuel Segment Director DNV GL, the Norway-based marine classification society, told the seminar that all shipbuilding projects starting today must consider the legacy and market changes related to ship’s fuels, noting, “It’s not business as usual. For example, shipping will see the application of exhaust gas cleaning technologies which are new for the industry.” He says there are challenges to resolve over different European legislative approaches to LNG, universal availability of the fuel, as well common standards in prices. “In the end, every fuel solution must be competitive from a commercial point of view.”
He adds that after 2025 it will not be possible to run on heavy fuel-oil all over the world. While there will be different fuels emerging for shipping, Dr. Würsig says, “We think that one of the majors will definitely be LNG because it will be available everywhere, it is easy to ship large quantities and can be made available at a reasonable cost.” In 2014 the industry hit a significant milestone with over 120 LNG-fuelled ships in operation or on order worldwide. They range from passenger ferries, Coast Guard ships, containerships and Con-Ro vessels to tankers and platform supply vessels. Dr. Würsig says the number of ships using LNG as fuel is increasing quickly, and more and more infrastructure projects are planned or proposed along the main shipping lanes. Fifty LNG-fuelled ships (excluding 400 LNG carriers) already operate worldwide, and as of fall 2014, another 69 new builds were confirmed.
”LNG technology is still quite young, but the two-stroke engine, which is the workhorse of shipping, has been available as an LNG conversion since 2012 and a second manufacturer began producing LNG-compatible versions in 2014.” He adds that by 2016, the first LNG-fueled bunker ships will be available, with seven vessels already on order. Apart from the significant economic savings, the main argument for LNG replacing conventional oil-based fuels is the significant reduction in local air pollution. Significant reductions in emissions of SOx (sulphur oxides) and NOx (nitrogen oxides) as well as carbon dioxide, particulates and black carbon becomes possible. With LNG the complete removal of SOx and particulate emissions combined with the reduction of NOx by 85 per cent, validate the advantages to human health and the environment. The use of LNG also reduces CO2 emissions by at least 20 per cent.
From LNG to methanol: Waterfront Shipping exploring methanol-fueled ships
Headquartered in Vancouver, Waterfront Shipping Company Ltd. operates the largest methanol ocean tanker fleet in the world. The company is a wholly-owned subsidiary of Methanex Corporation, the Vancouver-based, publicly-traded company that is the world’s leading supplier of methanol. Waterfront Shipping operates a fleet of 18 deep sea tankers comprised of vessels from 3,000 to 50,000 dwt. Jone Hognestad, President, tells the seminar participants, “In 2014, Waterfront carried 4.4 million tonnes of methanol, and Methanex had revenues of just under US$3.2 billion with a sales volume of 8.5 million tonnes.”
Mr. Hognestad explains that methanol is a basic building block for many downstream chemical industries and is increasingly being used in more energy applications. Methanol can be made from natural gas, coal, biomass, landfill gas, power plant emissions, as well as CO2 from industrial emissions. “In 2013 Methanex announced an investment with Carbon Reduction International (CRI) in Iceland, to grow the use of renewable methanol and increase the amount of low-carbon methanol from sustainable resources.” CRI produces renewable methanol from carbon dioxide, hydrogen and electricity for energy storage, fuel applications for power generation and industrial production.
“You can put scrubbers on the stacks, but it’s very expensive and takes a lot of dry-dock time,” Hognestad says. “Liquefied natural gas works from a new build perspective, but it’s challenging and costly to retrofit a ship to run on it. You can use marine gas oil, which is very expensive and may be in significant demand in the coming years. Or you can use a product like methanol.” A ship retrofitted to run on methanol can also use less-expensive bunker oil when feasible. “When you’re inside an area that has these restrictions, you can run on a 95-per cent methanol and 5-per cent bunker fuel blend and meet the air-quality standards. And when you’re outside, you can run 100-per-cent bunker. We have what we call a dual fuel: same engine, different sets of injectors and two different fuel sources.” He adds that methanol is easier to handle than LNG, since it’s already a liquid and can be loaded from shore tanks or barges.
The first ship to be powered by methanol says Mr. Hognestad is the Stena Ferry Lines 240-metre, 1,500-passenger ship Stena Germanica. “Using a Wartsilla four-stroke engine, the first engine conversion was completed in March, 2015 with the remaining three engines to be converted by mid-year.” At the end of 2013, Waterfront Shipping Company Ltd. reached an agreement with Mitsui O.S.K. Lines, Ltd., Westfal-Larsen & Co A/S and Marinvest/Skagerack Invest to build six new ships all to be delivered during 2016, with an option for building an additional three. The 50,000 deadweight tonne vessels will be built with MAN ME-LGI flex fuel engines running on methanol, fuel oil, marine diesel oil, or gas oil.
Waterfront Shipping will charter these vessels to replace older vessels in its fleet and to support increased demand for Methanex Corporation’s growth, including the relocation of two methanol plants from Chile to Geismar, Louisiana. The company’s core fleet of methanol product tankers includes eleven 45/ 50,000 dwt tankers, four 30,000 dwt tankers and two smaller vessels. During the six winter months we take in a small ice-class ship (20,000 dwt) which we use to service the St. Lawrence from Trinidad. The majority of our fleet is on long-term time charter, three vessels are jointly owned, but built to our specifications.”
With the growing demand for cleaner marine fuel to meet environmental regulations in Northern Europe and off both the Pacific and Atlantic coasts of North America, Hognestad says, “Methanol is a sulfur-free fuel that provides many environmental and clean burning benefits. With fuel prices increasing and shipping regulations requiring the use of cleaner marine fuel, methanol-based fuel is a promising alternative which reduces emissions and fuel costs.”