(30c) Expanding the Role of LNG as a Shipping Fuel

The International Maritime Organization (IMO) has moved ahead with tighter sulfur caps on marine fuels. This may seem to be a problem removed from the mid-stream gas industry as the fuel of choice for the shipping industry is heavy bunker fuel. These tighter caps present several options for compliance; however none of them provide an easy fix for the shipping industry. Removing the sulfur from heavy bunker fuel is not an easy task and would require significant upgrades for many refineries. Removing the sulfur on the ship using and Exhaust Gas Cleaning System (EGCS) is also a costly upgrade for a ship.

Other solutions include switching fuel sources which is where the mid-stream gas industry could find an opportunity. Liquefied Natural Gas (LNG) is one possible option; it easily meets the sulfur requirements and also is seen as a win towards a reduction in greenhouse gas emissions. Another option is Methanol which has the advantage of simpler storage and handling. Methanol can be generated from many sources including natural gas.

This paper will look at the challenges for each of the options and the prospects for natural gas to become a significant player in fueling the shipping industry.