The growth of small scale LNG infrastructure will boost the use of gas as a marine fuel, says AG&P’s head of advanced research, Derek Thomas
The use of liquefied natural gas (LNG) by passenger ships will be facilitated by AG&P’s plans to make the fuel more widely available via small scale infrastructure.
AG&P is building its first small scale LNG carrier at its facility in Batangas in the Philippines. The vessel design has been finalised with a 16-month time-line to delivery. It will revolutionise the delivery of LNG in Southeast Asian island nations as well as having the potential to be used in India, China and the Caribbean, and on European waterways. One of the market drivers is a recognition of the need to break away from major, large scale terminals and deliver LNG to a broader market in a cost effective manner.
LNG is now at a viable price in Southeast Asia, but what is lacking is the availability of mechanisms to deliver the fuel to non traditional users. Large scale infrastructure costs so much that LNG is priced out of the market. So simple, economic solutions are going to be key. People in Southeast Asia are very concerned about pollution and they will support the conversion of vessels to this fuel if the cost is reasonable.
These kinds of platforms can also be applied in North America, Europe and Australia. There is interest in the use of LNG as fuel by cruise ships and ferries that operate on conventional fuels in and around Sydney Harbour, because people living nearby complain about the pollution. This same situation exists in European ports and small Caribbean islands, which may have five major cruise ships in port at the same time.
AG&P’s 4,000m³ workhorse LNG carrier is targeting locations which require shallow draught and do not have tugs and sophisticated dockside facilities. The aim is to extend the vessel’s capability by using different equipment packages added to the base platform. We are also looking at building multiple units in parallel and making them available on a leased basis. This innovative commercial approach is equally as important as the technology in opening these new markets.
The planned vessel is part of AG&P’s ‘virtual pipeline’ concept. There is a demand for LNG but the infrastructure is not in place to deliver it, and in many locations it is physically and economically unfeasible to construct gas pipelines.
As part of this concept the company is developing a range of smaller vessels and terminals to deliver LNG to locations without direct access to pipeline gas, thereby developing a virtual pipeline. This will support the take up of LNG by smaller cruise ships. While Carnival Corp has the scale to ink an agreement with Shell, there are a lot of small cruise ship operators who have a need for small scale LNG bunkering infrastructure. A question that is repeated time and again by shipowners is: Where will we get the LNG? LNG as a marine fuel is moving forward, but these pieces will help it move faster.
There is also a need in the USA for small scale liquefaction facilities that can serve as peak shaving plants as well as being a local source of LNG for marine fuel. AG&P is exploring the idea of deploying facilities of this kind on floating platforms using pipeline gas as feedstock. The targets are major port locations serving Jones Act trade and cruise ships, particularly in the Pacific Northwest, such as Tacoma in the USA and Vancouver, Canada.
The transition from current marine fuels to LNG can be likened to the change from coal to oil. And the provision of bunkering infrastructure, cost effectively, is crucial for the swift uptake of this cleaner fuel of the future.
© 2023 Riviera Maritime Media Ltd.