Maersk Lines Up Latest Green Methanol Fuel Supply Partnership

Danish shipping giant Maersk has announced its latest partnership as it works to secure its green methanol fuel supply needed to power its future fleet of nineteen methanol-powered containerships.

The latest partnership was signed with U.S- based project developer Carbon Sink LLC covering the development by Carbon Sink’s of green methanol production facilities in the United States. Carbon Sink is currently developing its first facility co-located at the Red River Energy bio-ethanol plant in Rosholt, South Dakota.

The facility will have a production capacity of approximately 100,000 tonnes per year and is anticipated to begin commercial operations in 2027. Maersk has signed a letter of intent to purchase the full volume of fuel produced at the plant, with options for the output of subsequent Carbon Sink facilities at other locations.

“Securing green fuels at scale in this decade is critical in our fleet decarbonisation efforts,” says Berit Hinnemann, Head of Green Fuels Sourcing at A.P. Moller – Maersk. “We have set a 2040 net zero target for our entire business – but importantly to stay in line with the Paris Agreement, we have also set 2030 targets to ensure meaningful progress in this decade. Partnerships are essential on this journey – and I am very pleased to welcome Carbon Sink on board.”

The strategic partnership is now eighth Maersk has entered into in its search to secure green methanol fuel supplies for 19 containerships it currently has on order that will be powered by the carbon-free alternative fuel.

Back in March, Maersk announced partnerships with six energy companies to jump-start green methanol production with the intent of sourcing at least 730,000 metric per year of the fuel by end of 2025. That amount would be enough to power approximately 12 ships. A seventh partnership with Chinese bioenergy enterprise Debo was announced in August covering an additional 200,000 tonnes of per year of green bio-methanol starting in fall 2024.

According to Maersk, Carbon Sink uses a commercially available technology to produce green methanol by combining green hydrogen from electrolysis of water using additional renewable electricity and biogenic CO2. The CO2 for the first project will be recycled CO2 waste captured from the Red River Energy bio-ethanol plant.

“We are very pleased to be working with Maersk in support of their mission to decarbonise the shipping sector,” says Steve Meyer, CEO of Carbon Sink. “Carbon Sink brings a vast wealth of knowledge, experience and partnerships to help them achieve their ambitious corporate goals. Our multi-project development strategy creates a pathway for the supply of significant volumes of green methanol to help meet the demand of Maersk’s growing dual-fuel ship fleet.”

Maersk placed its first order for eight 16,000 TEU methanol-powered ships with South Korea’s Hyundai Heavy Industries in August 2021, and earlier this year exercised options for four additional sister ships. Last month, Maersk announced another order for six 17,000 TEU methanol-powered ships. All eighteen newbuilds will be delivered in 2024 and 2025.

Maersk also has a single 2,100 TEU methanol-powered dual fuel feeder ship on order at Hyundai Mipo Dockyards with delivery planned by 2023.

Maersk says that by using green methanol fuel, the 19 ships will save around 2.3 million tonnes of CO2 per year compared to conventionally-fueled ships.

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