The Week in Alternative Fuels

Here are some of the key developments in alternative bunker fuels from the past week.

PHOTO: A model of MOL's LPG-ammonia carrier. MOL

Ammonia is considered to play a vital role in decarbonisation of the shipping industry as its easier to store and transport compared to hydrogen. This week oil major ExxonMobil and three Norwegian firms announced plans to produce 20,000 mt of green hydrogen and 100,000 mt of ammonia/year at its Slagen terminal in Norway.

Port of Rotterdam’s strategic location makes it an ideal place to supply hydrogen to markets in Europe including the Netherlands, Germany and Belgium. The port aims to supply 4.6 million/mt of hydrogen across Europe by 2030. This week Air Products and Gunvor Petroleum Rotterdam announced a plan to develop a hydrogen import terminal in Rotterdam by 2026. The duo plan to import green ammonia to the terminal and later convert it to hydrogen.

With ports pushing to develop terminals for ammonia imports, the need to develop more ammonia carriers has increased. This week Japanese shipping firm Mitsui O.S.K. Lines (MOL) and partners have agreed to jointly develop an LPG-ammonia carrier that will be ammonia powered. The companies expect a rise in demand for ocean transport of ammonia amid the thrust on decarbonisation of the maritime sector.

As emission norms get stiff for the shipping industry more firms are announcing plans to curb emissions.  A study by Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping suggests that 33 of 94 major shipping companies across the world have committed to achieving net-zero emissions target by 2050. Mærsk highlights that container shipping firms are more actively leading net-zero initiatives, but a lot is yet to be achieved by other segments.

LNG is estimated to have around 25% lower carbon dioxide emissions than conventional fuels. This week CMA CGM announced a multi-year supply agreement with Shell, wherein Shell will supply LNG to CMA CGM’s 13,000 TEU vessels in Singapore from mid-next year onwards.

Along with LNG, Biofuel too has emerged as a relevant interim solution to curb emissions with no or little modification to engines or sub-systems. This week TotalEnergies delivered a biofuel-blended VLSFO stem to a RoRo vessel operated by MOL in Singapore. MOL's initial analysis shows that the carrier's engine and machinery performed smoothly, demonstrating compatibility with biofuel.

The Port of Rotterdam authority and Dutch energy firm Eneco are developing shore power facility at two berths in Waalhaven quay in Rotterdam for Boskalis vessels.  The shore power facilities are expected to be completed by June next year and 2GWh of green electricity will be supplied from Eneco’s renewable sources.

MOL transported clean ammonia from UAE’s Abu Dhabi to Japan in an ISO tank container. The ammonia was supplied by Abu Dhabi National Oil Company (ADNOC) and produced by Fertiglobe, demonstrating a potential ammonia supply chain network between the two countries.

Here are the top five stories in alternative fuels this week:

ExxonMobil aims to develop Norway's Slagen terminal as ammonia bunker hub

Oil major ExxonMobil and three Norwegian firms are seeking to produce 20,000 mt of green hydrogen and 100,000 mt of ammonia/year at ExxonMobil's Slagen terminal.

The consortium has signed a memorandum of understanding (MOU) to study the potential for the production and distribution of green hydrogen and ammonia as low-emission marine fuels at ExxonMobil's Slagen terminal.

ExxonMobil seeks to utilise the expertise of Maritime investor Grieg Edge, hydrogen firm Green H and renewable energy firm North Ammonia who are key partners in the project.

Hydrogen shows promise in significantly reducing carbon dioxide emissions, and the study will explore the potential for the terminal to reduce emissions in Norway’s maritime sector, said ExxonMobil president for low carbon solutions Dan Ammann.

The oil major is exploring opportunities to transport and use ammonia as a fuel in carriers.

Last year, the Norwegian government published a roadmap to establish a market for production and use of hydrogen by 2050.

Air Products and Gunvor join hands to develop green hydrogen terminal in Rotterdam

American gas supplier Air Products and refiner Gunvor Petroleum Rotterdam have agreed to jointly develop a green hydrogen import terminal in Rotterdam by 2026.

Green ammonia will be imported to the terminal and converted to hydrogen to supply markets in Europe, including Netherlands, Germany and Belgium.

Ammonia is a hydrogen derivative that has a higher liquifying temperature and takes less storage space than hydrogen.

Green hydrogen, which is produced using renewable energy, has great potential to decarbonise heavy-duty transport including shipping, Port of Rotterdam authority says.

The port authority announced last month its goal to supply 4.6 million mt/year of hydrogen to Europe by 2030 through local production and imports.

"Green ammonia is not only a hydrogen carrier and a feedstock for the chemical industry, but it’s also an important renewable fuel for the shipping sector," Port of Rotterdam’s chief executive Allard Castelein says.

MOL to jointly develop ammonia-fuelled liquefied gas carrier

Japanese firms Mitsui O.S.K. Lines (MOL), Tsuneishi Shipbuilding and Mitsui E&S Shipbuilding have agreed to jointly develop an LPG-ammonia carrier that will run on ammonia.

The trio expects to launch the vessel in 2026, which they claim to be the first “net zero emission ocean-going vessel”. They expect a rise in demand for ocean transport of ammonia amid thrust on decarbonisation of the maritime sector.

The design will allow the vessel to use some of its ammonia cargo as fuel, MOL says.

A study by shipping classification society DNV states hydrogen derivatives such as ammonia and methanol will play key roles in decarbonising the shipping sector.

Japan’s government has embraced ammonia as a future fuel. Last year, it announced ambitious plans to increase ammonia demand from shipping and the power sector to 30 million mt/year by 2050, from a current 1 million mt/year.

MOL has set net-zero emission target for 2050 and aims to operate 110 zero-emission vessels by 2035.

Only 35% of big shipping firms have set net-zero targets, says Mærsk Mc-Kinney Møller Center

Only 33 of 94 major shipping companies across the world have committed to achieve net zero emissions target by 2050, according to a study by Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (MMMCZCS).

It also factors in shipping companies’ commitment towards the International Maritime Organization’s (IMO) target of 50% reduction in annual greenhouse gas emissions by 2050 compared to 2008.

While urging shipowners to work on their emissions reduction targets, the Center called its analysis a “serious wakeup call for the industry”.

The assessment is based on decarbonization targets and actions published by leading companies operating in tanker, bulk, container, and RORO/car businesses, which altogether accounts for 70% of the global maritime emissions.

The study highlights that container shipping firms have shown the highest level of determination as 16 of the 30 top firms have set emissions reduction goals till 2050.

Mærsk Mc-Kinney recommends regulators implement mandatory reporting requirements for climate-related impacts through third-party auditing systems.

Shell to supply LNG to CMA CGM containerships in Singapore

French container line CMA CGM has signed a multi-year agreement with oil supermajor Shell, securing LNG bunker supply for its 13,000 TEU vessels in Singapore from mid-next year onwards.

FueLNG will deliver LNG stems to CMA CGM’s containerships through its LNG bunker barge- FueLNG Bellina and another 18,000 cbm LNG barge it plans to operate next year.

FueLNG, is a joint venture between Shell and Keppel Offshore & Marine Ltd (Keppel O&M).

CMA CGM and Shell have also signed a Memorandum of Understanding (MoU) to advance utilisation of low carbon fuels such as methanol and bioLNG.

LNG is estimated to have around 25% lower carbon dioxide emissions than conventional bunker fuels.

CMA CGM currently operates 12 LNG-powered containerships and aims to expand the fleet to 32 containerships of various sizes.

Earlier this year, CMA CGM and Shanghai International Port Group (SIPG) signed a 10-year LNG supply agreement, wherein SIPG will supply all CMA CGM’s vessels sailing from China to the US with LNG while they handle cargo in Yangshan port.