MSC support for LNG provides fuel for thought

Despite its green credentials being effectively discredited, MSC’s latest orders and new membership of fossil industry lobby Sea-LNG shows LNG is still going strong.

MSC’s latest order, for ten 10,300 teu LNG-fuelled box ships, means 60 out of the 74-strong MSC newbuild orderbook will be LNG-powered.

Sea-LNG, whose board includes representatives of Total and Shell and membership consists of at least 14 fossil fuel and petrochemical companies, welcomed MSC into its ranks this month.

“MSC’s decision to work with our coalition of companies across the LNG value chain demonstrates its confidence in the LNG pathway as a viable solution for flexibly advancing shipping along its decarbonisation journey,” said chairman Peter Keller.

Sea-LNG has long maintained that LNG represents shipping’s most readily viable pathway to zero emissions. The grounds for this claim are that bio-LNG and synthetic LNG, which in theory could be made entirely from renewable feedstocks, is chemically identical to fossil LNG, making for an easy switch.

Indeed, attempts to replace ship fuel with bio-based equivalents have met with considerable success. Drop-in replacements for heavy fuel oil – LNG’s better-established, cheaper, less-complex, higher-energy content older brother, which does not leak methane, and for which the overwhelming majority of existing ship engines and fuel tanks are designed – are readily available in many ports.

These are often purchased by shipping’s customers as a way of ‘insetting’ CO2 emissions, sidestepping the infamous owner-charterer investment deadlock.

Mr Keller said fossil LNG was “available at scale for deepsea shipping today,” adding that “existing LNG infrastructure can accommodate bio-LNG and renewable synthetic LNG as they become increasingly accessible, lowering investment barriers.”

When burned in a ship engine, LNG provides a CO2 emissions reduction of up to 20%, prompting claims by advocates that it is a greener alternative to other fossil fuel oils like HFO and marine diesel. However, ships burning LNG for fuel tend to emit a certain amount of unburned methane in their exhaust – so-called ‘methane slip’ – emitting a gas which is around 30 times as harmful as CO2 in terms of trapping heat in the atmosphere.

This means that even a small percentage of methane slip can more than eclipse the 20% emissions reduction. In the IMO’s Fourth Green House Gas Study in 2020, the organisation opted to account for methane emissions in all of its calculations. The findings of a UMAS study this year demonstrated that adoption of LNG represented “a statistical irrelevance” in terms of shipping emissions reduction.

The implication is that more than a decade of costly and time-consuming research and development of LNG-fuelled shipping has been a complete waste. The study said: “LNG provides a negligible impact on well-to-wake greenhouse gas emissions… and so there is no material change in the overall WtW GHG reduction, regardless of the take-up of LNG between now and 2030.”

Nevertheless some 50 new bunkering facilities for LNG are planned for 2025 and LNG made up 81% of ‘alternative fuel’ ship orders last year. These included ten 11,500 teu MSC vessels for delivery 2025-2026.

Mr Keller has previously told The Loadstar methane slip was “an overused argument for those wishing to justify inaction” and, he expects, will have been “virtually eliminated” by 2030.

Bud Darr, EVP of MSC’s maritime policy & government affairs, said: “We are committed to catalysing the development, accessibility and uptake of net zero fuels and believe we have found another excellent partner to help continue to drive the industry in this direction. We look forward to working with SEA-LNG to further assess and collaborate on the exciting long-term prospects of bio-LNG, and particularly renewable synthetic LNG, as mainstream marine fuel molecules.”