Western Australia is the largest iron ore producer in the world. Port Hedland aerial courtesy Pilbara Ports Authority
New regulations on limiting sulphur and nitrogen oxides emissions and a burgeoning global infrastructure are adding to the growing momentum for the widespread adoption of LNG as a marine fuel.
Now a new joint industry project is looking to capitalize on the opportunity to drive additional development of the market by assessing the commercial potential of LNG-powered bulk carriers in a “green corridor” between Australian and China. The project will culminate with the developement of an LNG-fueled Capesize bulk carrier – an industry first.
The joint industry project, named Green Corridor, was recently launched in Singapore by partners BHP Billiton, Mitsui O.S.K. Lines, Rio Tinto, SDARI, Woodside, and international classification society DNV GL, who will take the lead in the project.
The JIP has two main objectives: building and assessing the business case for LNG as fuel for Capesize bulkers operating in the trade between Australia-China, and developing an efficient LNG fueled Capesize concept design.
“As we approach the entry into force date for sulphur emissions, we are seeing interest in LNG as a ship fuel start to climb again,” says Morten Lovstad, DNV GL – Maritime Business Director Bulk Carriers. “As one of the largest LNG exporters in the world and with bunkering infrastructure coming online, Australia is well placed to support the bulk trade on the west coast with LNG as fuel. By working together with some of the industry’s technology leaders we are confident this new project has the potential to deliver a competitive, compliant and safe vessel and the business case to back it up.”
The project partners will work to develop a concept design for an efficient LNG fuelled Capesize vessel. The ship will be optimized for operations from and to Australia, and will be developed to a technical stage so that it may achieve an Approval in Principle (AiP) in compliance with the new DNV GL rules.
Also a financial and technical feasibility study will look at a wide range of factors including the capital costs, operational costs and price sensitivities in terms of LNG and low sulphur marine fuel oils, in comparison to both a conventionally fueled vessel and a LNG retrofit. Project partners will also be undertaking a high level bunker supply chain assessment to identify the key issues affecting the vessel design and business case.
Woodside COO Mike Utsler commented: “We recognise that LNG as a transport fuel option presents opportunities, both in a commercial sense and as a low-emissions alternative to other marine fuels. This JIP importantly is bringing together mining companies, a shipowner and supplier, a ship designer and LNG producer and led by DNV GL to explore how we can develop the LNG fuelled ‘Green Corridor’. Woodside is this year taking delivery of the first LNG fuelled marine support vessel in the Southern Hemisphere and we look forward to the findings from this joint industry project on the potential for LNG fuel use by bulk carriers.”
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