A significant innovation at the Gastech exhibition is a series of free-to-attend theatres dedicated to delivering knowledge, education and awareness of technological innovations in natural gas.
At the next Gastech in South Korea in March, these Centres of Technical Excellence (CoTEs) will feature over 60 seminars at which industry leaders will showcase their latest developments. In advance of these seminars, Gastech News has asked them for their views on key industry trends.
Here, we examine their replies on the theme of LNG fuel technology for marine applications – focusing on how quickly the market is likely to grow, which will be the most promising regions, and what the industry is doing to ensure safety of operations.
Over the past two years it has become clear that a promising new market for LNG will be in transportation, in road and marine applications, traditionally the province of oil products. The use of LNG as fuel in marine applications is being driven by two key factors: tightening environmental regulations and the big differential between oil and gas prices in some regions, notably North America.
So, how quickly is the market expected to grow? And which will be the most promising regions?
“Wärtsilä envisages that by 2020, more than a quarter of the ordered vessels could be designed to run on gas fuel,” says Rolf Stiefel, the company’s Sales Director. “The regions for the fastest adoption will be Emission Control Areas (ECAs) and Sulphur Emission Control Areas (SECAs), and areas where LNG is readily available at attractive price levels versus liquid fuels.”
Luis Benito, responsible for global strategic marketing at Lloyd’s Register, agrees that environmental regulations will be a key driver: “The use of LNG as a shipping fuel is starting to occupy a significant portion of marine market minds, focused on short sea shipping for ECA areas – including inland water ways – with the reality of Norway, the Baltic Sea and North America ECAs to start with.
“Gas-fuelled shipping could start to expand in potential future ECA areas – such as the Mediterranean Sea – before too long, as the European Union is now showing direct support for all European waters and not only the declared ECAs. Furthermore, other countries where ECAs are not planned yet are showing increased interest in adopting LNG as shipping fuel in their territorial waters.
“The first major international LNG-fuelled shipping project was the Lloyd’s Register classed Viking Grace [pictured above], delivered in January 2013. This project has set the agenda for addressing international, open sea trading of gas-fuelled ships.”
How feasible are retrofits? A crucial issue for fleet operators, and a significant factor in how quickly the market is likely to grow, is whether it will be feasible to retrofit existing vessels.
“In our view, gas as fuel will be mostly driven by new-building activity,” says Wärtsilä’s Stiefel. “Depending on vessel type and operation, a retrofit can be feasible but we do not expect it to become a mainstream activity. The cost for retrofitting is higher than for new building. The biggest challenge is the integration of the LNG tanks required onboard the ships not colliding with cargo operations. We are running several feasibility studies for our customers.”
Sören Karlsson – General Manager, Gas Applications, Ship Power Technology at Wärtsilä – adds: “There is a potential to retrofit LNG fuel systems for ships in operation. However, since the investment is rather heavy, the ships should not be older than 10 years, and naturally, space for the LNG tank has to be found."
Lloyd’s Register’s Benito agrees that while retrofitting existing ships may be technically feasible, “it may be economically non-viable for certain ship types and sizes, due to the complexity of adapting an existing ship’s layout to the outfitting and gas-fuelled tank size requirements”. Except where financial aid is made available for reasons of policy, he adds, “we should not expect a mass retrofitting market emerging anytime soon”.
Ensuring safety: As the use of LNG as fuel becomes more widespread, the number of people involved in handling it will grow, which raises issues of training and safety. What is the industry doing to address these issues, given the need to protect its impressive safety record over several decades?
“The industry seems well aware of the paramount importance of addressing this challenge,” says Benito. “It has started to work on several fronts to address the competency issue in its entirety.
“For example, we at Lloyd's Register have developed a Competency Framework for the Maritime and Port Authority of Singapore so that appropriate standards can be produced and prescribed to crew on board gas bunkering and gas receiving ships. Also, reputable gas ship operators with years of experience are starting to offer crew training to operators that are new in handling gas ships and gas on board.”
A very significant development, he adds, is that SIGTTO has created a new organisation – the Society for Gas as a Marine Fuel (SGMF) – that is focused on gas-fuelled shipping. “That will greatly contribute to the standards of crew and people involved in handling gas safely,” he says.
“The regulatory framework for LNG as ship fuel is evolving very fast,” agrees Wärtsilä’s Karlsson, “with Lloyd’s Register introducing its rules for gas-fuelled vessels in January 2014. The design is inherently safe, whereby a single failure will not cause a dangerous situation. For the LNG systems delivered by Wärtsilä, we always arrange on-site training for the personnel – on board or at the Wärtsilä Land and Sea Academy.”
Looking forward to Gastech
Both Wärtsilä and Lloyds Register will be participating at Gastech and all three of the experts we spoke to for this article described the event as very important for their businesses.
“Gastech has become a global forum where the marine community gathers to focus,” says Benito, “and the focus is always clear – it is gas.”
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