LNG as a Marine Fuel
Liquefied natural gas (LNG) is becoming an increasingly popular marine fuel as the shipping industry looks for alternatives to reduce emission from vessel operations. With high sulfur limits coming into force under IMO regulations, many shipowners are turning to LNG since it produces less emissions compared to conventional marine fuels such as heavy fuel oil.
Advantages of Using LNG as a Bunker Fuel
LNG produces significantly lower emissions than heavy fuel oil in several key areas:
Sulfur Oxides (SOx) - LNG contains almost no sulfur so when combusted it produces no sulfur dioxide emissions. This is a huge benefit as concerns grow over the human health impacts of SOx in coastal communities and populated port cities. The new IMO regulations will see a global sulfur cap of 0.5% come into effect in 2020, making LNG compliant without the need for expensive exhaust gas cleaning systems.
Nitrogen Oxides (NOx) - LNG as a Bunker Fuel engines are capable of meeting the upcoming Tier III standards for NOx emissions in Emission Control Areas which will take effect from 2021. This is a significant reduction over conventional marine diesel engines. Tests have shown that LNG dual-fuel engines can reduce NOx by approximately 85% compared to heavy fuel oil.
Particulate Matter (PM) - The use of LNG virtually eliminates particulate emissions which are a major health hazard. Tests have found particulate emissions were reduced by over 98% when switching from heavy fuel oil to LNG.
Greenhouse Gases (GHG) - Methane slip from LNG engines is low and methane has a lower global warming potential than the carbon dioxide produced by heavy fuel oil combustion, providing a reduction in overall GHG emissions up to 25% based on well-to-wake analysis.
Logistical Advantages - LNG bunkering is simpler and faster than other low-sulfur alternatives such as LNG or methanol. It does not require expensive exhaust gas cleaning systems or complex fuel treatment processes. There are also no expensive blending requirements.
Growing Infrastructure and Availability - Major ports across Europe and Asia have developed or are developing LNG bunker vessels and terminals to serve the growing LNG-fuelled fleet. LNG is globally available with established trading and supply chains. More infrastructure is being developed each year to support LNG as a marine fuel.
Switching to LNG as a Bunker Fuel: Challenges and Considerations
While LNG presents clear environmental and compliance advantages, there are also challenges shipowners must consider whenevaluating a switch to the fuel:
Capital Costs - Retrofitting or newbuilding a vessel designed specifically for LNG propulsion requires a significant capital investment premium estimated between 10-30% over a conventional setup. This includes storage tanks, gas value units, and potentially engine upgrades.
Tank Space Requirements - LNG requires approximately 2.5 times more tank volume than heavy fuel oil to provide a similar energy content due to its lower density. This affects cargo capacity and may require structural modifications on older vessels.
Training and Safety Regulations - Specialized training is required for crews to handle LNG safety due to its cold temperatures and flammability. Strict international regulations apply to vessel construction, equipment certification, and operating procedures while using LNG.
Limited Bunkering Infrastructure - The availability of LNG bunker vessels and terminals remains limited compared to conventional oil-based marine fuels. Additional infrastructure investment is needed, especially in emerging markets and for oceangoing deep-sea shipping routes.
Fuel Price Volatility - As a relatively new marine fuel, LNG prices have exhibited more volatility than heavy fuel oil and other established fuels. In some regional markets LNG may also carry a price premium over conventional fuels.
Technology Maturity - Dual-fuel engines are an established technology but continued research is focusing on fully cryogenic and smaller high-speed engines suitable for a wider variety of vessel types. Gas valve units also require further miniaturization.
The Outlook for LNG in International Shipping
Despite the challenges, LNG adoption is forecast to grow rapidly this decade as the advantages outweigh the costs for many ship operators. Key factors influencing the outlook include:
- IMO regulations will significantly tighten emissions limits, making LNG the most compliant solution available using established technology. More ports are expected ban high-sulfur fuels altogether.
- Major engine makers like MAN ES and Winterthur Gas & Diesel are releasing new engine designs to improve efficiency and suitability for different vessels.
- Increasing experience with LNG bunkering and developing global standards will help make operations more seamless across different trade routes.
- Infrastructure investments from national energy companies, ports, and entire industrial clusters will accelerate LNG availability. Over 200 LNG bunker vessels are on order through 2025.
- Newbuilding contracts for LNG-fuelled container ships, car carriers, bulk carriers and tankers indicate broad acceptance by owners across sectors.
- Dual-fuel technology allows shipowners flexibility to use conventional fuel during infrastructure growth before fully committing to LNG.
- Broader use of LNG as a bunker fuel in other industries like power generation and trucks will drive economies of scale and make prices more competitive over time.
By 2030, forecasts suggest over 10% of new vessels could be built LNG-powered and perhaps 5-10% of global deep-sea fleet capacity could utilize LNG along major trading routes. As technology improves and costs fall, LNG promises to significantly reduce emissions from international shipping and displace dirtier fuels. With growing availability and acceptance,
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