Out-of-fashion LNG now the favourite fuel for new containerships
LNG appeared briefly to go out of fashion last year after being slammed as a ...
CAT: RISING TRADEEXPD: TRUMP TRADE LOSER LINE: PUNISHEDMAERSK: RELIEF XPO: TRUMP TRADE WINNERCHRW: NO JOYUPS: STEADY YIELDXPO: BUILDING BLOCKSHLAG: BIG ORDERLINE: REACTIONLINE: EXPENSES AND OPERATING LEVERAGELINE: PIPELINE OF DEALS LINE: DEMAND PATTERNS LINE: LANDSCAPELINE: CONF CALL STARTSDSV: UNTOUCHABLEEXPD: NOT AS BULLISH AS PREVIOUSLYFWRD: SPECULATIVE RALLY
CAT: RISING TRADEEXPD: TRUMP TRADE LOSER LINE: PUNISHEDMAERSK: RELIEF XPO: TRUMP TRADE WINNERCHRW: NO JOYUPS: STEADY YIELDXPO: BUILDING BLOCKSHLAG: BIG ORDERLINE: REACTIONLINE: EXPENSES AND OPERATING LEVERAGELINE: PIPELINE OF DEALS LINE: DEMAND PATTERNS LINE: LANDSCAPELINE: CONF CALL STARTSDSV: UNTOUCHABLEEXPD: NOT AS BULLISH AS PREVIOUSLYFWRD: SPECULATIVE RALLY
LNG-fuelled ships could come under greater scrutiny following yesterday’s attack on methane by the US special presidential envoy for the climate, John Kerry.
In a press briefing, Mr Kerry said that the US was making “a major focus on methane reduction” and hoped for a similar commitment from China.
“China is one of the largest emitters in the world, and we are number two,” he said. “We’re both very conscious of the fact that our citizens want cleaner air and healthier lives… they want us to have a safer world in which energy isn’t weaponised.”
And in his opening remarks this morning, COP28 president and Abu Dhabi National Oil Company (ADNOC) CEO Sultan Al Jaber was similarly critical of methane.
“It wasn’t easy… but now, many [oil and gas] companies are committing to zeroing-out methane emissions by 2030 for the first time. And many national oil companies have adopted net zero 2050 targets for the first time.”
Until now, discussions of greenhouse gas emissions have typically been dominated by carbon dioxide (CO2). Methane’s properties make it about 30 times more effective at trapping heat, meaning even a small methane emission is a very potent factor in climate change. Although there is proportionately less methane in the atmosphere than CO2, it is responsible for around 50% of warming.
And Mr Kerry added: “We will include all greenhouse gases within the future reduction plans of each country.”
Ship engine designs are gradually being optimised to reduce methane slip – emissions of unburned methane in their exhaust. Although the impact of LNG-fuelled ships on methane emissions is meagre, compared with those from oil and gas production and land-based industry, they still not been fully eliminated in any engine. Levels vary depending on usage profiles, engine loads and sea states and powering more vessels with LNG will unavoidably have an incrementally greater effect on the climate.
Some estimates even have methane emissions increasing by 150% over the past six years, the delivery of LNG-powered ships being one of very few possible culprits.
Opinion is divided on the effectiveness of LNG as a decarbonisation fuel; according to one recent study by UMAS, a switch to LNG by some vessel owners has, and will have, amounted to nothing by the end of the decade.
“LNG provides a negligible impact on well-to-wake greenhouse gas emissions… and so there is no material change in the overall well-to-wake GHG reduction, regardless of the take-up of LNG between now and 2030,” UMAS determined.
However, LNG advocacy group SEA-LNG labels arguments disparaging LNG as “sensationalist claims, lacking scientific evidence”, citing Sphera research showing LNG can bring well-to-wake emissions reductions of up to 23% for some engine types.
Mr Al Jaber, meanwhile, responded robustly to allegations that he would be using COP28 to forge new deals relating to oil and gas exploration, saying they were “false, not true, incorrect, and not accurate”, Sky News reported.
The Loadstar’s coverage of COP28 is sponsored by EVERGREEN LINE: leading the development of a sustainable global container transportation system.
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