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Issue 209 September 2022 - LNG Issue
Gasworld US Edition, Vol 60, No 09 (September) - Equipment Issue
By Dominic Ellis 2022-09-01T08:19:00+01:00
ZIM Integrated Shipping Services has signed a 10-year LNG sales and purchase agreement, worth more than $1bn, with Shell NA LNG.
The deal will see the supply of 10 LNG-fuelled vessels that will be deployed on ZIM’s flagship ZIM Container Service Pacific (ZCP), on the Asia to USEC trade.
The 15,000 TEU vessels, expected to enter into service during 2023-2024, will be transporting goods from China and South Korea to US East Coast and the Caribbean.
About 23% of total shipping emissions are from the container segment alone and with increasing global trade of goods, these emissions need to be addressed on a prompt basis.
LNG is the lowest carbon fuel available at scale today and it provides ~20% less GHG emissions when compared to conventional marine fuels.
In addition to GHG emissions reduction, LNG emits virtually no Sulphur oxides (SOx) and particulate matter (PM), while significantly reducing nitrogen oxide (NOx) emissions.
For ZIM, using LNG on these ten ships is equivalent to having two out of the 10 vessels in the fleet operating with zero emissions.
Eli Glickman, ZIM President & CEO, said, ”With the addition of significant LNG-powered capacity to our fleet, beginning in 2023, we have positioned ZIM as a leader in carbon intensity reduction among global liners.”
He said its growing LNG-powered fleet will enable the Israel-based shipping company to be more carbon and cost efficient, while improving its competitive position, particularly on the strategic Asia to USEC trade, and allowing customers to reduce their carbon footprint.
Steve Hill, Executive Vice President, Energy Marketing at Shell, congratulated ZIM for introducing the world’s first LNG-fuelled Very Large Container Ship (VLCS) fleet to operate on the Asia-North America shipping route.
He said, “Decarbonisation of the shipping industry must begin today, and LNG is a lower emission fuel choice currently available in meaningful volumes, and via liquefied biomethane and liquified e-methane, offers a credible pathway to net zero GHG emissions.”
The agreement may also cover other trades where ZIM LNG vessels could be deployed.
Mitsubishi Shipbuilding Co, a Mitsubishi Heavy Industries (MHI) Group company based in Yokohama, recently held a launch ceremony for the Sunflower Murasaki, the second of two large LNG-fuelled ferries being built for Mitsui O.S.K. Lines. The ceremony took place at the Enoura Plant at MHI’s Shimonoseki Shipyard & Machinery Works in Yamaguchi Prefecture.
How clean are LNG marine fuels?
Although LNG contains less carbon per unit of energy than conventional marine fuels, its use might not reduce greenhouse gas (GHG) emissions on a life-cycle basis, according to a paper from the International Council on Clean Transportation.
Over a 100-year time frame, the maximum life-cycle GHG benefit of LNG is a 15% reduction compared with MGO, and this is only if ships use a high-pressure injection dual fuel (HPDF) engine and upstream methane emissions are well-controlled, it states.
Using a 20-year global warming potential timeframe, which better reflects the urgency of reducing GHGs to meet the climate goals of the International Maritime Organisation (IMO), and factoring in higher upstream emissions for all systems and crankcase emissions for low-pressure systems, there is ”no climate benefit from using LNG, regardless of the engine technology,” the report adds.
The most popular LNG engine technology is low-pressure dual fuel, four-stroke, medium-speed, which is used on at least 300 ships; it is especially popular with LNG fueled cruise ships. Results show this technology emitted 70% more life-cycle GHGs when it used LNG instead of MGO and 82% more than using MGO in a comparable medium-speed diesel (MSD) engine.
”LNG will likely remain less expensive than VLSFO (very low sulfur fuel oil) in the future and might be less expensive than HFO (heavy fuel oil), depending on how the price of HFO responds to the IMO’s 2020 global sulfur limit. Therefore, some ship owners are finding that it makes economic sense to invest in an LNG-fuelled ship.”
The EU believes LNG can play a major role in shipping achieving the continent’s decarbonisation goals.
By 2030 EU shipping could be using about 9.3Mt of LNG per year, which is larger than the total annual consumption (8.3Mt in 2020) of a country like Romania.
Sarawak Shell Berhad and Petronas Carigali have taken a final investment decision to develop the Rosmari-Marjoram gas project in Malaysia.
Gibraltar continues to work round-the-clock to contain diesel from a bulk carrier after it collided with an LNG vessel.
Namibia and Equatorial Guinea are looking to strengthen energy ties and specifically focusing on LNG development and knowledge-sharing opportunities.
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