Page 6 - GLNG Week 48

GLNG COMMENTARY GLNG
Total doubles down on bunkering
A subsidiary of Total has announced a pair of separate but related deals on its LNG bunkering operations in France
PIPELINES & TRANSPORT
WHAT:
TMFGS has announced two deals related to its LNG bunkering operations.
WHY:
The company is promoting the use of LNG as marine fuel ahead of the implementation of IMO 2020 rules.
WHAT NEXT:
More vessels are likely to turn to LNG bunkering in the future to ensure compliance with the new rules.
TMFGS is playing an increasingly active role in promoting LNG as a marine fuel.
FRANCE’S Total is doubling down on LNG bun- kering, with a pair of separate but related deals announced this week. e deals, announced on December 4, involve the company’s Total Marine Fuels Global Solutions (TMFGS) subsidiary and its bunkering operations in the Marseille-Fos area of France.
e rst of the two deals is a long-term char- ter contract between TMFGS and Japan’s Mitsui OSK Lines (MOL) for a large LNG bunker ves- sel that will be positioned at Marseille-Fos. is is the second such charter contract for a large LNG bunkering ship between the two compa- nies, with the rst agreed in February 2018. at vessel was launched in October, and is touted as the world’s largest bunkering ship. e new ves- sel will be delivered in 2021 and will be the rst such ship to operate in France.
The second of the two deals announced this week is an agreement for TMFS to supply roughly 270,000 tonnes per year (tpy) of LNG to CMA CGM over a 10-year period to fuel the latter’s container ships at Marseille-Fos, also starting in 2021. e ships in question are CMA CGM’s future 15,000-TEU container ships that will operate between Asia and the Mediterra- nean Sea.
LNG bunkering push
e deals are aimed at promoting the use of LNG as a marine fuel, and come ahead of the imple- mentation of International Maritime Organisa- tion (IMO) rules on January 1, 2020 that seek to limit sulphur content in bunker fuel to 0.5%, from 3.5% currently. Following the rule change, the marine sector will have a number of options in order to ensure compliance. ese include switching to low-sulphur fuel oils, t equipment known as scrubbers that will allow vessels to keep using high-sulphur fuel oil (HSFO) by cap- turing sulphur and other pollutants as the ship burns fuel, or turning to LNG.
is could be an attractive option because LNG emits almost zero sulphur and particulate matter and achieves around a 90% reduction in nitrogen oxide emissions. It also reduces carbon emissions by around 27% compared to the fuels currently used, though it increases methane emissions, but only by a small degree.
However, building an LNG-fuelled ship adds about $5mn to construction costs – roughly comparable with the cost of installing a scrubber. Additionally, retro tting vessels to run on LNG was previously considered to be prohibitively costly, though advances are being made that are bringingsuchcostsdown.
Meanwhile, the cost of LNG could serve to make it a more favoured fuel option, especially now that spot prices for it are sinking to new lows.
TMFGS is playing an increasingly active role in promoting LNG as a marine fuel. Announcing the launch of its rst large LNG bunker vessel that it has chartered from MOL in October, the French company noted that the vessel’s design was in line with IMO 2020 regulations. “In this context, the transition from heavy fuel oil to LNG is a competitive, e cient and immediately available solution for maritime transportation,” TMFGS said at the time.
A er its delivery in 2020, this vessel will oper- ate in Northern Europe. It will supply LNG to commercial vessels including 300,000 tpy for CMA CGM’s nine ultra-large newbuild con- tainerships in Europe-Asia trade, for a period of at least 10 years.
e latest agreement struck between TMFGS and CMA CGM is therefore an extension of this partnership. Under the deal, as well as supplying LNG to CMA CGM’s vessels at Marseille-Fos, TMFGS is committed to providing a “com- plementary bunkering solution” in Singapore. “ ese new supply chains will further expand the use of LNG as a marine fuel, particularly in theMediterraneanSea,”TMFGSsaidinitsstate- ment announcing the deal.
What next?
The new LNG bunker vessel chartered from MOL will now be built by Hudong-Zhonghua Shipbuilding in China, like the rst ship. e new ship will also have a capacity of 18,600 cubic metres and a length of about 135 metres and will be tted with the Mark III membrane containment system provided by French com- panyGTT.
“ is vessel has been speci cally designed to supply LNG bunker in the Mediterranean area to a wide range of vessels, including containerships, tankers, ferries and large cruise ships,” TMFGS said this week. “She will meet the highest techni- cal and environmental standards, using herself LNG as propulsion fuel and integrating a com- plete re-liquefaction of the boil-o gas.”
e vessel will be operated under French ag by MOL, jointly with Marseille-based Gazocean. “In recent years, the role of LNG has changed enormously,” commented MOL’s managing executive officer, Kenta Matsuzaka. “LNG of course serves as a clean energy source, and we expect to see wider use for it as a vessel fuel, so weanticipatesigni cantgrowthinthefuture.”™
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w w w . N E W S B A S E . c o m Week 48 05•December•2019