The global bunkering arm of TotalEnergies invests in adding new large-capacity LNG bunker vessels, while studying solutions to underpin the uptake of alternative fuels such as ammonia
As shipping grapples with the challenges of decarbonisation, shipyards are taking the first orders for vessels designed to burn carbon-neutral methanol, operate on hydrogen or be built as ammonia-ready. Decisions being made now in boardrooms, bank offices and on trading floors will shape the future fuel landscape and global fleet in the decades ahead.
But much work still has to be done regarding safety, training, regulation, technology, bunkering, availability and scalability, said a leading executive for a major marine fuels supplier.
“Ammonia is quite exciting as a potential fuel because of its zero-carbon properties,” TotalEnergies Marine Fuels (TEMF) global sales and business development director Jesper Rosenkrans told Marine Propulsion.
Sitting at the business entity’s Singapore headquarters, Mr Rosenkrans oversees the sales, trading and operations of its shipping fuels portfolio, which includes very low sulphur fuel oil, along with LNG, bioLNG and future fuels, once they become commercialised.
Attractive as it might be, ammonia still has to clear technical, operational, regulatory and commercial hurdles before there can be widespread adaption across shipping. “That’s true for all alternative fuels,” he said.
A concern with ammonia fuel is that NOx and N2O emissions need to be controlled and reduced. While ongoing research persists to prevent these emissions, solutions exist to mitigate both NOx emissions and ammonia slip. For instance, ammonia slip catalysts have been developed for land-based and road transport, while catalysts for the combined removal of NOx and N2O are also commercially available.
N2O emissions and ammonia slip can be reduced by operating on high temperature. Unburnt ammonia and NOx emissions can, too, be reduced through engine calibration and more controlled combustion conditions, for example, by applying exhaust gas recirculation as proposed by MAN Energy Solutions.
Coalitions work on solutions
Several large marine stakeholder coalitions are working feverishly on solutions. One, joined by TotalEnergies in June, involves 23 leading companies across diverse industries that are studying ammonia as an alternative marine fuel. The coalition is assessing the safety of ammonia-fuelled ships, ammonia bunkering, ammonia fuel specification and the net carbon emissions from ammonia production.
By using ‘green’ ammonia – produced from green hydrogen using renewable electricity, water and air – international shipping could cut CO2 emissions to meet IMO’s carbon emission reduction targets proposed by 2050.
In another joint project through the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping, TotalEnergies is working with shipping industry partners to assess the technical, financial and environmental potential of converting existing vessels to future fuel solutions and technology, such as ammonia.
And about a year ago, TotalEnergies created a Clean Hydrogen business unit to produce and commercialise green hydrogen, the first building block of green ammonia.
LNG is the way to go
While Mr Rosenkrans is enthusiastic about the potential of ammonia, he’s also pragmatic. In examining the composition of the future global fleet in one or two decades, Mr Rosenkrans said it is “almost inconceivable” that every one of those ships would be run on a single future fuel. “We’re all working hard on (future fuels), but they are not yet mature.” For now and some years ahead, that leaves shipowners “essentially choosing between conventional fuel and LNG. I think LNG clearly wins that race in terms of its greenhouse gas (GHG) emissions and particle reductions, and its overall economic value proposition. Additionally, it provides a pathway towards the use of lower-carbon, and potentially carbon-neutral, bioLNG in the future,” he said.
“LNG is an important fuel in decarbonisation because it is available now. If we want to start acting now, this is the fuel of choice. We can sit and wait for future fuels – and hope they become available sooner rather than later – or we can do something right now. LNG is the way to go.”
As compared with VLSFO, LNG as a marine fuel virtually eliminates SOx and particulates, NOx by 85% and CO2 emissions by 20-25%.
Regardless of industry discussions around whether it is a transitional fuel for the next 15-20 years, LNG is important because it leads to immediate GHG reductions, said Mr Rosenkrans. “Let’s get going.”
LNG demand rising with fleet growth
Some shipowners are heeding Mr Rosenkrans’ plea. Shipbuilding contracts for LNG-fuelled tonnage have surged this year led by the container ship sector. Of the 332 LNG-fuelled vessels on order, 63 are for container ships. Overall, there are 210 LNG-fuelled vessels in the global fleet, according to DNV’s Alternative Fuels Insight.
Parent company TotalEnergies is betting big on LNG, with an expected LNG portfolio of 50M tonnes by 2025 or about 10% of the global market share. To serve its customers, TEMF has a presence in the major global bunkering hubs and is investing in LNG fuelling infrastructure, including at the Port of Singapore, where it is now one of three LNG bunkering licensees.
By early 2022, TEMF and Pavilion Energy will share a newbuild 12,000-m3 LNG bunker vessel to serve ship operators in Singapore. The joint use agreement for the LNG bunker vessel was struck prior to TEMFs gaining its own bunker licence in the port. “The fact that we’ve pursued and been granted our own bunker licence gives a sign of the ambitions that we have which go beyond this first asset,” said Mr Rosenkrans. He foresees adding further LNG bunker vessel capacity “in the years ahead.”
This bullish outlook is supported by TEMPF’s own projections for LNG as a marine fuel in the decades ahead. It anticipates global LNG bunkering demand may rise to 10M tonnes per annum by 2025 and represent more than 10% of the bunkering market in 2030.
“As the world’s largest conventional bunkering hub, Singapore is well positioned to become a major LNG bunkering hub and will experience the same growth trajectory,” noted Mr Rosenkrans.
The new LNG bunker vessel will be the largest in Singapore, reinforcing Total Energies’ philosophy of securing the largest capacity assets in a bunkering region. It charters 18,600-m3 Gas Agility in the Port of Rotterdam and its sister vessel, Gas Vitality, which will be stationed in the Port of Marseille, France, when delivered in October. “It allows us the flexibility to serve any type of receiving vessel – from container ships to tankers to bulkers – and perform fewer reloading operations,” said Mr Rosenkrans.
This strategy mitigates loading constraints at terminals in the future when more LNG bunker vessels will be in operation. “We’re going to run into a bottleneck on the reloading side; there’s plenty of LNG as a product, LNG barges and vessels, but limited reloading slots. We’re competing with small-scale LNG cargo operations.”
Besides ammonia and hydrogen, carbon-neutral LNG, bioLNG, e-LNG, and synthetic LNG will be “absolutely part of the future,” said Mr Rosenkrans, “but we have to make sure the value proposition is attractive here and now” for LNG carriers “so that we have the assets in place that can then be used for carbon-neutral LNG of the future.”
“The complexity of the bunkering market will certainly increase by several folds as shipping moves away from a mono-fuel market. I see more industry collaborations will be formed to speed up R&D, but at the same time, we will need supportive regulatory measures, such as carbon-pricing mechanisms, to raise the economic attractiveness of these future fuels and the supply required for shipping.”
Taking carbon out of shipping by 2050 won’t be simple, but TotalEnergies has aspirations to play a leading role in the industry’s energy transition in the decades ahead.
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