New Fuel, New Market

Oct 1 2012

Lauritzen Kosan joins other industry stakeholders to outline an infrastructure for using liquefied natural gas (LNG) as an alternative to oil-based fuels.

New regulations on the sulphur content of fuel for shipping in the Baltic Sea, the North Sea and the English Channel – Sulphur Emission Control Areas (SECA) – will come in force on 1 January 2015.

The mandate to decrease sulphur content from 1.0 per cent to 0.1 per cent has intensified interest in the possibility of using LNG – which has significant environmental and climate advantages over oil-based fuels as an alternative fuel.

Moreover, LK is looking at LNG not only as an alternative fuel solution, but also as a new business opportunity in LNG transportation.

Both of these considerations spurred LK to join other industry stakeholders representing the LNG supply chain – including states and ports, as well as gas and LNG terminal companies – in working on the North European LNG Infrastructure Project, which recently concluded with a report titled, “A feasibility study for an LNG filling station infrastructure and test of recommendations.”

The project forms part of a larger initiative co-financed by the EU on LNG infrastructure and deployment in ships, which includes two full-scale pilot LNG cruise ferries serving the southwestern part of Norway and the European continent through the Port of Hirtshals, Denmark.

An open question

For more than a year, Peter Justesen, vice president and head of fleet management for LK, and Søren Berg, project manager, with the assistance of LK technical specialists, represented LK at project meetings around northern Europe and in the UK.

“Our basic mission was to try to map out what is needed for LNG to become a viable alternative to heavy fuel within the North European area,” says Søren Berg. “The benefits and technology are proven: LNG is a much cleaner fuel, which emits virtually no particles, no NOx and SO x, and considerably less CO2. The main obstacle is the almost total lack of infrastructure for storage and distribution. Ship owners are hesitant to convert to LNG before infrastructure is available.”

Peter Justesen concurs: “At this point it’s an open question,” he says. “If the infrastructure is available, people will invest in LNG-powered ships, it’s as simple as that. The key to making it happen is to determine infrastructure requirements and many related questions, and that was the focus of the project.”

Although natural gas is in some regards easier to handle than heavy fuel, it presents storage challenges. If natural gas is cooled down to minus 162 degrees Celsius, it becomes a liquid (LNG – liquefied natural gas).

Through liquefaction, 600 cubic metres of natural gas are condensed to one cubic metre, which makes natural gas suitable for storage, transport, and bunkering. Even so, it still takes nearly double the space of heavy fuel and needs purpose-built cryogenic tanks – existing fuel oil tanks cannot be used.

Read the full article in Lauritzen News no. 17, October 2012 >>>

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