Qatargas, UASC, and Shell Sign MoU to Develop LNG as Marine Fuel

Delivered in April 2015, the MV Barzan was the first of six United Arab Shipping Company’s (UASC) 18,800 TEU containerships.
Delivered in April 2015, the MV Barzan was the first of six 18,800 TEU containerships for UASC. 

Qatari natural gas producer Qatargas, United Arab Shipping Company and Shell have signed a Memorandum of Understanding (MOU) to explore the development of liquified natural gas as a marine fuel in the Middle East region.

Under the MoU, the partners will explore the development of new markets for LNG bunker fuel within the Middle East and the conversion of UASC’s existing vessels to LNG. LNG fuel supplies will be made available from Qatargas 4, a joint venture between Qatar Petroleum and Shell Gas B.V., with United Arab Shipping Company Line potentially using the fuel for its recently built container ships.

This is the second such agreement signed by Qatargas and Shell in the past two months.

The MOU was signed at a ceremony attended by Qatargas Chief Executive Officer, Khalid Bin Khalifa Al-Thani, United Arab Shipping Company Chief Executive Officer, Jorn Hinge and Managing Director and Chairman of Qatar Shell Companies, Michiel Kool.

“LNG as a marine fuel is gaining momentum in the deep sea transportation industry as the best alternative to meeting increasing environmental standards,” said Saad Sherida Al-Kaabi, Chairman of Qatargas Board of Directors. “This agreement between Qatargas, Shell and United Arab Shipping Company demonstrates our commitment to building LNG fueled vessels and the supply system to support it. Further to our commitment to pioneering new LNG applications and in preparation to fulfilling any upcoming regulatory requirements, we believe that this direction by Qatargas and its industry partners is the right path to support a cleaner environment.”

Jorn Hinge, United Arab Shipping Company Group Chief Executive Officer, said: “As part of our newbuilding program, UASC has received thirteen of seventeen new vessels over the past sixteen months; seven 15,000 TEU vessels and six 18,800 TEU ultra-large container vessels. We are due to take delivery of a further four 15,000 TEU vessels in the coming months. These ships are the greenest in the world and uniquely LNG-ready, meaning once the infrastructure is ready globally, with a quick and cost-efficient retrofit, they can run on LNG and become even more eco- friendly.”

“We have seen an increased demand on green shipping from our customers in recent years and a focus on how the eco-efficient technologies on our new vessels can help them achieve their own sustainability strategy. Stricter environmental regulations are also expected, something we are well prepared for. Many organizations have already included stricter requirements in their tenders and evaluation criteria, meaning only those carriers with optimum environmental credentials will qualify or be shortlisted,” Hinge added.