Momentum Building for LNG Bunkers

LNG expert Mike Corkhill argues LNG bunkering is finally poised to move forward

Adoption of liquefied natural gas (LNG) bunkers has moved more slowly than some pioneers expected, but it is poised for a breakthrough as more LNG production projects move forward and tighter sulfur rules go into effect, LNG expert Mike Corkhill writes in a BIMCO feature article.

Today, most of the 35 LNG-fuelled ships in operation sail in Norwegian waters, thanks to what Corkhill described as supportive government policies and plentiful natural gas in the area.

But in other areas, ship owners who bought LNG fuel systems for their vessels have found adoption of the fuel, and construction of fuelling infrastructure, is moving slowly.

Still, Corkhill writes, Norway's example along with new limits on the sulfur content of fuel that will come into effect in the coming years, are pushing many ship owners to see LNG as the most viable short-to-medium term solution for compliance.

Forty LNG-fuelled ships are now on order, with some of them intended for international routes.

"The swelling order-book indicates that the momentum is building and breakthroughs are poised to happen," Corkhill writes.

LNG fuel is likely to remain attractively priced thanks to North American natural gas development and government pushes in China, Europe, and elsewhere for the adoption of LNG bunkers to reduce pollution.

Corkhill noted that officials in the European Union (EU) are particularly focused on LNG today, with the EU governing body, the European Commission, calling for LNG bunkering stations across Europe and the Trans-European Transport Network (TEN-T) Executive Agency funding several related pilot programs.

At a recent meeting, some EU member states expressed concern about how plans for implementing alternative energy, including LNG bunkering, across the continent will be funded and implemented.