LNG bunkering as common practice

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Koyel Ghosh of Allied Market Research investigates why LNG bunkering has become common practice in the marine industry.

LNG that has been unflustered to a certain temperature at climatic pressure turns out to be a transparent and odourless fluid that is non-toxic in nature. Bunkering of LNG can be defined as the method of conveying LNG to a vessel for its own consumption. The benefits of utilising LNG as a marine fuel

in the marine sector include fewer emission releases, abridged shipment charges, a non-toxic environment, etc. Strict environmental regulation toward contamination caused by shipping is projected to be the major factor driving the growth of the global LNG bunkering market in more than one way. At the same time, in the last five years, the number of LNG driven vessels has also experienced a steep hike, thereby boosting the market growth even further.

Utilisation of LNG as ship fuel has gained momentum in Europe lately. Also, in Asia and the US, bunkering of LNG has started becoming quite prominent in the marine industry. LNG as a ship engine component has now appeared as one of the most encouraging novel technologies for shipping.

Fossil fuels in the form of diesel and gasoline happen to provide most of the required energy for the commercial transportation industry, and the ignition of these fuels release gasses that disturb air quality and are also responsible for climate change. In the coming years, natural gas as a marine energy substance is anticipated to be incorporated by shipping lines across several global divisions – regional tankers, cruise, containers, etc. To support this change, LNG bunkering will be an essential service required at harbours worldwide.

Most harbours around the globe have started to take the threat of air pollution more seriously, and the contribution of the marine sector can bring a considerable change to the threat. Growing health awareness among individuals during the current pandemic has procured huge interest and contributes as a major determinant of viable port activities. This, merged with the need to curtail the carbon footprint of the marine sector, implies increased usage of LNG to cater to these goals.

Across the world, the year 2020 has seen an intense shift in public outlook toward greener activities, and shipping organisations that do not happen to take positive feats to adhere to the mandatory environmental targets end up putting their corporate reputations at stake. This, in turn, is most likely to lead to negative impacts on funding, sponsorship, employee detention, customer contentment, and operational freedom.

The air quality benefits of LNG have been known for decades, and it is a strong choice for shipowners concerning the proactive methods of tackling decarbonisation – one of the significant challenges that will delineate the decade ahead. The solution to it certainly lies in utilising LNG, thereby achieving a carbon reduction of more than 20% on a well-to-wake basis in comparison with current oil-based marine engine components over the entire lifecycle. In alliance with design and operational efficiency methods, the primary 2030 goal for a reduction in GHG can be met utilising LNG. The initiation of bio-LNG and switching to synthetic LNG at a steady pace will also gradually help decarbonise shipping toward IMO’s 2050 bulls.

LNG technology

The maritime sector has been striving hard to enhance its sustainability, especially its releases to the air. However, in terms of GHG emissions, the sector must take proper advantage of the technological advancements today so as to reduce the long-term impact on the environment. The LNG bunkering set-ups are improving at a gradual pace, with fuel already obtainable in major shipping centres.

When it comes to new building structure, the approval of LNG has been highly dilated in recent times. This has been fuelled by a fusion of the environmental aids and reasonable fuel costs. Swapping to LNG as a fuel substance tends to provide noteworthy advantages including lighting on regulatory requirements, providing improved competitiveness, enhancing overall air quality, and reducing greenhouse gas emissions.

A number of surveys have been conducted and it has been revealed that vessels that are fuelled by LNG can diminish their EEDI rating by almost 20%, while their Carbon Intensity Indicator would be concentrated by nearly the same amount. It also happens to lessen the NOx secretions by approximately 80%, and almost terminates the SOx particulate matter. With the contemporary engine technology onboard, GHG releases can be reduced by up to 23%. At the same time, biogas and drop-in fuels hold out a path to further diminishing vessel carbon intensity. Moreover, to get the most out of these benefits, it is highly essential to opt for the right technology that suits the vessel type and the operational constraints.

Operational safety

When it comes to operational safety while bunkering at ports, one must make sure that the proper and precise environmental and operational safety methods are in place. While offering LNG bunkering services at harbours, a number of actions should be taken into consideration:

Initial risk valuations to recognise any potential influences to the harbour, creating an outline for a clear and transparent conversation.

Modified bunkering checklists for LNG energy components created in association with the International Associations of Ports and Harbours.

Compatibility evaluations between fuel providers and ships prior to the commencement of any bunkering activity.

Adherence to industry guidelines as per SGMF as a framework for further safety measures.

The Senegal division of Australian energy company Woodside said July 12 it was moving ahead with a drilling campaign for the first phase of development at its offshore Sangomar complex.

Woodside Energy Senegal, the operator of the Rufisque, Sangomar and Sangomar Deep (RSSD) concession, said it expected its first drilling campaign for phase 1 development to begin this week.

Drillers will utilise two drillships, the first of which arrived July 8 in Senegal’s waters. The next one is scheduled for a mid-2022 delivery.

Phase 1 calls for 23 subsea wells and a stand-alone floating production, storage and offloading (FSPO) facility that has a production capacity of 100,000 barrels/day.

Although primarily an oil production project, with first oil expected by 2023, project partners also envision exporting commercial quantities of natural gas to the shore.

Woodside completed the acquisition of the entire participating interest of Sydney-listed Far in the RSSD joint venture in early July.

The purchase price was $45mn plus a working capital adjustment of approximately $167mn to reflect the acquisition effective date of January 1, 2020. The final completion payment was approximately $126mn, after adjustments and remedying of Far’s defaults under the joint operating agreement.

Additional payments of up to $55mn are contingent on future commodity prices and timing of first oil.

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