Orders for LNG-fueled Ships Are on the Rise
This year is shaping up to be a banner year for new liquefied natural gas (LNG) dual-fuel vessel construction contracts, with nearly 30% of the gross tonnage ordered in 2021 comprised of LNG-fueled vessels, according to the latest report from Clarksons.
The trend is expected to continue as major deep-sea sectors of the maritime industry are embracing LNG in efforts to reduce both local and global emissions, said industry coalition SEA-LNG. Notably, LNG-fueled vessels are one of the only options today that meet the reduced emissions required of environmental finance.
It is anticipated that more than 90% of the new pure car and truck carriers (PCTC) that will enter the market in the coming years will be LNG dual-fuel. Likewise, containership owners and operators are moving to LNG-fueled tonnage, with orders for LNG-fueled liners increasing fivefold since January 2020. Tankers and bulkers are also following suit, with increases of sevenfold and twofold respectively over the 18-month period.
LNG has been proven, is available now and reduces SOx and particulates to negligible levels, NOx by up to 85%, and GHG emissions by up to 23%. It can also achieve the IMO’s 2030 target of reducing CO2 emissions by 40% compared to 2008 by the use of bio-LNG products as a drop in fuel. This transition to bio-LNG, and eventually synthetic LNG, will enable the industry to meet the IMO 2050 targets utilizing established LNG infrastructure around the globe.
Peter Keller, Chairman of SEA-LNG said, “The deep-sea shipping industry understands that while LNG may not be the end game, it is the best starting point to get to net zero. It provides a very clear and achievable plan which starts today. We know the need is real and waiting is no longer an option. Recognition for this plan and the pathway forward is continually growing—borne out by the data from both Clarksons and DNV. And the acceleration in uptake of newbuilds fueled by LNG demonstrates confidence in this pathway through its bio and synthetic cousins.
“The advantage of LNG is that both bio-LNG and synthetic LNG are ‘drop-in’ fuels. There are no compatibility issues, and any ratio combination of bio-LNG, synthetic and ‘conventional’ LNG can therefore be used to fuel a large proportion of the deep-sea merchant fleet. It has the potential to scale incrementally in line with the growing availability of biomass and renewable energy, while delivering significant GHG reductions, starting now.”