World News
LR: Financial Returns Biggest Obstacle in Shift to LNG Bunkers
Nick Brown, Brand and External Relations Manager at Lloyd's Register says that opportunities in liquefied natural gas (LNG) bunkering are highly dependent on the financial returns for the alternative fuel.
In an interview with World Maritime News, Brown noted that demand for LNG Bunkers "is certainly growing," with adoption to date focused on specific niche sectors such as ferries, short-sea shippers, and more recently cruise shipping.
"By far the biggest blocker is financial – providing investors with the likelihood of returns," he said.
Brown noted that the development of LNG bunkering infrastructure for point-to-point or short-sea routes was is "relatively easily" even with modest volume demands, citing as an example the Jacksonville, Florida, to San Juan, Puerto Rico route where TOTE Maritime plans to deploy its first-ever LNG-powered container ship.
"It is providing large scale, large volume supply for deep sea ships in key locations that is the real challenge," he said.
Nevertheless, Brown said that with demand for seaborne gas trades expected to grow, "it’s probably not an issue of ‘if’ but ‘when’ is the right time to invest."
In its latest Global Marine Fuel Trends report, LR predicts by 2030 up to 11 percent of deep sea newbuilds could be using LNG Bunkers, and as much as 20 percent of cruise ship newbuilds could be using gas by that time.
In late November 2015, Ship & Bunker announced that it had begun publishing LNG bunker prices for the port of Vancouver.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 647.00 | 6.00 | 762.00 | 5.50 |
| Rotterdam | 599.00 | 1.00 | 751.00 | 0.50 |
| Houston | 618.00 | 11.50 | 802.50 | 6.50 |
| Fujairah | 642.00 | 5.50 | 883.50 | 5.50 |
| Global 20 Ports Average | 661.50 | 3.50 | 859.00 | 5.00 |
| Global 4 Ports Average | 629.50 | 1.00 | 799.50 | 1.50 |
| Global Average Bunker Price | 719.00 | 3.50 | 915.00 | 7.50 |
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