Navigator Gas ‘breaks new ice’ with ammonia-fuelled carriers

As one of the largest owners and operators of handysize liquefied gas carriers in the world, Navigator Gas has been in the business of transporting ammonia for more than two decades. But the Big Board-listed company is “breaking new ice” with ammonia as a fuel with the aid of a multi-million dollar grant from Enova and a joint venture with Norwegian maritime development company, Amon Maritime.

“We have been transporting ammonia for 25 years,” observed Navigator Gas chief executive, Mads Peter Zacho, “but this is a first for us to use it as a fuel.”

Navigator Gas, through a new 80% owned JV, Navigator Amon Shipping, has ordered two 51,530-m3 ammonia dual fuel-powered liquefied ammonia carriers from China’s Nantong CIMC Sinopacific Offshore & Engineering Co, Ltd. Capable of transporting ammonia and LPG, these vessels will be the largest in the company’s fleet when they are delivered in June and October 2028. The two newbuilds cost about US$84M per vessel and are underpinned by grants totalling Nrk180M (about US$18M) from Norwegian government agency, Enova, which supports clean energy R&D projects.

“This is a first for us to use it as a fuel”

Mr Zacho said the order represented “an incredibly important step for us in preparing for the future,” noting it follows “suit on our commitment to have net-zero operations by 2050.”

When delivered, the gas carriers will operate under a five-year charter carrying ammonia for a “blue-chip industry leader”. While vessels will be dual-fuel propulsion, Mr Zacho expects that for the first five years they will be burning ammonia as a fuel most of the time.

“We are very confident that clean ammonia will be a successful marine fuel,” said Mr Zacho, addressing the question of availability and regulatory drivers during a Capital Link webinar. “In terms of regulation, the EU and the IMO have made very clear commitments to net-zero emission shipping by 2050 and that will lead to gradually higher penalties for emitting CO2, and that makes all types of clean fuels more competitive from 2030 onwards,” he stated.

Mr Zacho pointed to the increase in ammonia-fuelled newbuilding orders at shipyards, which stand at about 50 vessels, along with the progress being made by large two-stroke engine manufacturers, Everllence and WinGD on developing propulsion technology for the zero-carbon fuel.

Concluded Mr Zacho: “It’s still early days, but we already see the volumes in terms of newbuilding orders are ramping up, and we expect that there will be a quick learning curve in terms of building this technology. There’s great resolve in the industry to make clean ammonia a successful marine fuel, and we think that it’s going to be a significant proportion of the alternative fuel consumption.”