More LNG ships to be powered by biofuel in Singapore

SINGAPORE Shipping and commodities firms will commission more ships powered by liquefied natural gas LNG next year, while ramping up trials for biofuel bunkering as they try to reduce emissions from ship operations, senior executives said this week.

The shipping industry is trying to reduce its reliance on oil as it tries to meet the emissions reduction targets set by the U.N. s International Maritime Organization.

The shipping industry is expected to reduce emissions by 40 per cent from 2008 levels by 2030 and greenhouse gas GHG emissions by 50 per cent by the year 2050.

Industry executives said at the Singapore International Bunkering Conference and Exhibition SIBCON 2022 that LNG, methanol and biofuel are some of the more popular alternative fuel options.

Several companies, including shipper Mitsui O.S. In 2023, Rio Tinto and BHP are expected to receive more LNG bunker vessels that will help shave off some emissions on their voyages.

Rio Tinto will bring nine LNG dual-fuelled Newcastlemax vessels into its portfolio, with the first delivery expected in the first half of next year, said Laure Baratgin, head of commercial operations at Rio Tinto.

The company wants to reduce emissions from operations by 40 per cent by the year 2025, which is why it started a one-year biofuel trial.

She told Reuters that up to 25 to 26 per cent of emissions reductions have been made so far.

The world's largest container operator, Moller-Maersk, is focused on using methanol.

The company ordered six more methanol-fueled vessels, bringing its total order of such ships to 19 on Wednesday.

Berit Hinnemann, head of decarbonization business development at Maersk, said Maersk's approach is to go to the green fields right away, and that the company will not be adopting LNG as part of its fuel mix.

She told Reuters that green methanol is a solution that is technologically ready, that fuel production can be scaled up and that we see it as a fuel option to make a sizable impact already this decade.

The demand for methanol was not really there and what we have been trying to bring momentum, to bring demand to the market by our vessel orders, Hinnemann said.

More and more companies are testing to blend biofuels with marine oil, which does not require shippers to make huge modifications to current engines.

France's TotalEnergies will start offering biofuels as a bunkering fuel to customers in Singapore from next year, while Cargill Inc wants to boost biofuels usage in a bunkering trial next year.

Industry sources said that limited biofuel supplies, a lack of industry standards in order to ensure the fuel's quality, and higher prices could limit its use in bunkering.

Companies are looking at green ammonia for bunkering beyond 2030.

The first ship powered by ammonia could be built in 2026 or 2027, according to BHP's head of maritime Fergus Eley, who said he hoped the fuel would have started pilot production by then.