Maersk Sees LNG as Cheapest Fuel Option Under Proposed Standards at IMO

IMO’s MEPC meeting is scheduled for 7-11 April. Image Credit: Maersk

Container line AP Moller Maersk has raised concerns that the current GHG fuel standard proposals at IMO make fossil LNG the most financially attractive option for shipping companies, despite its limited emissions reduction potential.

The math behind the proposed regulations heavily favours LNG over other low-emission alternatives such as e-methanol, ammonia, and biodiesel, Morten Bo Christiansen, senior vice president and head of energy transition at Maersk, said in a LinkedIn post.

Ships running on LNG can cut emissions by 10-20% compared to those running on conventional fuels. These dual-fuel vessels can also use bio-LNG and e-methane for further reductions, but Christiansen argues these fuels lack scalability for widespread adoption.

He adds that current IMO proposals offer little financial incentive to switch to cleaner LNG variants.

The unintended consequence is that fossil LNG becomes the go-to fuel, not because it is the cleanest, but because the numbers make it the cheapest option under these rules, Christiansen said.

He warned that this could slow investment in sustainable fuels, creating a "pay-to-pollute" scenario where shipping companies find it more cost-effective to use fossil LNG rather than transition to cleaner alternatives.

"The financial business case for LNG is likely to be compelling in the boardroom of any shipping company," he said.

Maersk is urging the IMO to adjust its proposals by ensuring that it supports a multi-fuel pathway.

With critical IMO negotiations approaching in April, Maersk urges the regulator to refine the framework to support a diverse mix of low-carbon fuels, avoiding a single-fuel lock-in that could slow shipping's path to net zero.

The IMO's MEPC meeting is scheduled for April 7-11, where member states are expected to finalise mid-term measures for GHG reductions. These measures may include a technical element like a global fuel standard and an economic component such as a carbon levy.

Maersk was a significant early adopter of methanol as an alternative bunker fuel, with its orders of methanol-fuelled ships helping to set up this nascent industry, but more recently the company has also been ordering ships capable of running on LNG.