LNG future in short sea shipping

According to DNV ’s summer students, LNG could easily become the most feasible means of fuel in short sea shipping. The students ’ report was presented today in front of an audience of 200 people – including shipowners, representatives from the supply industry and Norwegian authorities.
Ten master ’s students from Norway, Sweden and Nigeria, chosen among 150 applicants, have worked on this year’s summer project assignment – “LNG in short-sea shipping ”– for the past six weeks. The scope of the project was to set up a fictitious ship owning company operating ships fuelled on liquefied natural gas (LNG) in the Nordic region. The students, who study technology and economics, have investigated challenges and opportunities of operating vessels on LNG. During the six weeks the students have investigated the preferable trade and ship type for LNG operations, made specification to ship design and provided a viable fuel logistics solution. They have proven this to be safe, environmentally friendly and economically profitable.
Results
The market analysis conducted by the students showed that four oil tankers of Aframax size shipping crude oil were the most promising options when taking market attractiveness, technical feasibility, economic advantage and environmental impact into account. The most relevant ports within the trade were identified, and Primorsk, Mongstad and Teesport stood out as exporters while Rotterdam stood out as importer. While the major advantages of LNG as fuel are superior environmental performance and a lower price, the weaknesses are the immature LNG market as well as the limited distribution infrastructure. However, the students identified and presented a realistic approach to deal with these weaknesses.
Among other things the students suggested that, in order to make LNG available at a competitive price, large volumes of LNG are bought on the global market and then distributed to an onshore storage facility near Rotterdam. Bunkering of other vessels is then provided by a refuelling barge.
DNV CEO Henrik O. Madsen says “I was very impressed to see what the students presented here today. At times I have found it difficult to understand why the shipping industry has not switched to LNG – given the great commercial and environmental advantages. Today, with their presentation the students have provided ship owners with a blueprint, showing us all that it is 100% realistic to overcome the challenges with regard to LNG as fuel.”

3 Responses

  1. The small-scale LNG plant allows localized peak- shaving to occur – balancing the availability of natural gas during high and low periods of demand. It also makes it possible for communities without access to natural gas pipelines to install local distribution systems and have them supplied with stored LNG.

    http://www.inl.gov/research/lng-plant-technology/

    • This US DoE Idaho National Laboratory work demonstrates localised LNG production from natural gas distribution lines, for onward distribution or peak shaving. It is now more fully reported in a separate entry on the blog on 24 August..

  2. […] I discovered Nick Denbow’s Industrial Automation Insider blog this weekend and added it to my list of automation and process industries-related blogs. He had a post about university students studying the feasibility of using liquefied natural gas (LNG) as a fuel source in short sea shipping. […]

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