Falling Brent crude prices are dampening the business case for using liquefied natural gas (LNG) as bunker fuel, but there is still a case to be made, shipping consultants from DNV GL told TPS on the sidelines of APAC LNG in Singapore on May 13.
"Brent crude prices are still considered low at the current price of $67/b, even though they have risen slowly since early this year.”
“This has somewhat reduced the business case for using LNG as bunker fuel, but it is still feasible in terms of technology and economy,” a consultant told TPS.
Falling Brent crude prices have reduced the prices of marine fuel oils and other kinds of petroleum-based bunkers by about 50%, they said.
However, replacing conventional marine fuel oils with cleaner-burning fuels like LNG would still mean more sustainable business practices for ship-owners.
This is especially so with increasingly stringent regulations such as Emission Controls Areas caps of 0.1% sulphur limit implemented in 2015, as well as projected long-term fuel savings for ship owners.
More upcoming carbon dioxide or sulphur caps in the European Union (EU) region and throughout the world are also expected to be implemented between 2020 and 2025.
Using conventional bunker fuels such as low-sulphur marine fuel oils would result in escalating operational costs. Installing scrubbers to remove particles from emissions could be an alternative, but ship-owners would be limited by retrofitting or technological difficulties.
The analysts projected lower accumulated costs over the lifetime of the vessel for ship-owners if they were to switch completely to LNG bunker fuels with the environmental regulations being enforced.
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