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Container Shipping & Trade

Container Shipping & Trade

TOTE leads box ship industry in LNG drive

Fri 28 Jul 2017 by Rebecca Moore

TOTE leads box ship industry in LNG drive
Isla Perla being bunkered via TOTE’s purpose-built transfer skid, which bunkers the vessel within five hours

TOTE’s vessels are the first box ships to be fuelled by LNG. Its executive vice president Peter Keller spoke to Rebecca Moore about his belief that LNG is the most important fuel for the maritime industry

US container ship operator TOTE is helping to drive the way forward for container shipping industry to use LNG as fuel. Its two 233 m Marlin-class vessels are the world’s first container ships to operate on LNG and it is converting two roro ships to run on the fuel.

Isla Bella and Perla Del Caribe were delivered at the end of 2015 and beginning of 2016 respectively by US shipyard General Dynamics NASSCO and now operate between Jacksonville, Florida, and San Juan, Puerto Rico.

TOTE executive vice president Peter Keller told Container Shipping & Trade that it chose to power the new vessels with LNG because of new and upcoming IMO global sulphur emission requirements that come into force in 2020. “It was also about doing what is right and doing what our customers asked of us,” he added, saying that increasing numbers of exporters and importers were keen for their ocean carriers to be as environmentally friendly as possible.

Explaining why TOTE plumped for LNG and not scrubbers, he said that LNG addressed the “core problem”: the fuel itself. “Scrubbers are a viable short term solution for certain applications but they do not address the core issue.” He pointed out that scrubbers only scrub the fuel, but the sulphur, particulate matter and nitrous oxides must then be disposed of.

He warned “The clock is ticking. We may not like it, but in 2020 we will all have to deal with the global sulphur cap and the likelihood of other regulatory requirements over and above that sulphur cap is right there. It is not arguable in my view.”

Another reason why TOTE chose LNG was that most of the costs associated with it are fixed, unlike the volatility of the price of other fuels, Mr Keller said. “As a shipowner, that helps me understand what my costs are, going forward. That was a huge issue for us when we commissioned the world-first LNG powered container ships.”

With 1.5 years of operational experience to draw on, Mr Keller said that “as with any new technology there are always issues and challenges.” To combat these, TOTE’s marine engineering staff has been working with the dual-fuel engine provider MAN Diesel & Turbo to “develop appropriate solutions to ensure we maintain our high-performance reliability”.

TOTE has developed efficient solutions for bunkering its vessels. It currently bunkers 25 LNG ISO containers a week at Jacksonville Port within five hours using a purpose-built transfer skid. Tote’s proprietary skid has reduced the time taken to bunker by around 30 hours as it can bunker from four trucks at once. Mr Keller explained that the custom skid-mounted loading manifold had been specifically developed to Tote’s specification, and built Applied Cryogenics Technology.

But this is a temporary solution – Tote has an LNG bunker barge under construction at Conrad Shipyard. It will be the first barge to use GTT's atmospheric-pressure containment system and indeed the first LNG bunkering barge in the US. The barge is slated for delivery in Q1 next year and will take LNG directly from the liquefaction plant in Jacksonville, Florida, to bunker the two Marlin vessels. Mr Keller said that the skid would then be used as a back-up to the barge.

"LNG is the preferred maritime fuel for the next 30-40 years”

Peter Keller (TOTE)

Meanwhile, conversion of TOTE’s Orca-class roro vessels is taking place, also at General Dynamics NASSCO. TOTE has entered into a contract with MAN Diesel & Turbo for it to develop a conversion kit for the Orca vessels’ engines so they can operate as dual-fuel machines. “This ground-breaking programme is proceeding and we hope to be running on dual fuel / LNG in the early 2020s,” commented Mr Keller.

TOTE is a member of multi sector industry coalition SEA\LNG, which Mr Keller chairs, created to accelerate LNG’s adoption as a marine fuel. “We have essentially doubled our membership since establishing the organisation in 2016 and we are working on a number of interesting projects that will continue to focus on the long-term benefits of LNG as a maritime fuel of choice,” Mr Keller commented.

SEA\LNG includes class societies, shipyards and shipping lines. “We all need to work together to break the commercial barriers that we know exist,” Mr Keller emphasised.

For example, he said, “it is a very immature market [and] there is inaccurate information out there. We need to break down those barriers and move on, by collaborating from molecules [raw, natural gas] to propeller.” He said that Tote needed to show what it was doing in terms of LNG and communicate both internally and with the outside world. “We need to do this in a meaningful way, so that what we say is not seen as a market pitch or a sales pitch, but something to drive this exercise forward,” he said.

Asked about whether he believed that LNG use would increase among container ship operators, Mr Keller again highlighted the 2020 low sulphur regulations and the development of LNG bunkering infrastructure as key drivers. With these factors to consider, “we believe more shipowners will opt for dual-fuel LNG technology. It addresses the core issue of fuel quality.”

He highlighted how the global LNG infrastructure network had “grown dramatically” during the first half of the year, with supplies now available in ports around the world, including in the Middle East, Europe, Singapore, Florida’s Jacksonville and Japan’s Yokohama.

He listed costs, availability of LNG, and other factors as all likely to affect the growth of this “environmentally superior fuel”.

In the end, he said “Shipowners will do what is right for the environment.” In his opinion, LNG is the “preferred maritime fuel for the next 30-40 years”.


TOTE to kick off LNG use among Jones Act carriers

The LNG bunkering barge to be used by US-based carrier TOTE’s new gas dual-fuelled box ships is the first LNG bunkering barge in the US and is expected to help boost the use of LNG by US container ship operators.

LNG infrastructure solutions provider Atlantic, Gulf and Pacific (AG&P) subsidiary GAS Entec carried out the gas handling and design of the 2,200 m³ barge. It will help container ships in North America, especially those in the Jones Act trades, to expand their use of LNG quite significantly. Indeed, the use of LNG among Jones Act shipping lines could develop as much as it has done among ship operators in the Baltic.

There is also a need in the USA for small-scale liquefaction facilities that can serve as peak shaving plants and as local sources of LNG for marine fuel. AG&P is exploring the idea of deploying facilities of this kind on floating platforms using pipeline gas as feedstock. Potential locations are major ports serving Jones Act trades, particularly in the Pacific Northwest, such as Tacoma in the USA.

AG&P head of advanced research Derek Thomas


Peter Keller (TOTE) snapshot CV

Peter Keller joined TOTE in February of 2012 as president of TOTE Maritime Puerto Rico and has been leading the conversion of the company’s fleet to LNG.

Previously he was the principal of Peter I Keller and Associates, a consulting and advisory practice serving the maritime industry.

From 2000 until 2010, Mr Keller was executive vice president and chief operating officer of NYK Group Americas.

He was a member of the board of directors of Pacific Maritime Association, Pacific Maritime Shipping Association and the United States Maritime Exchange.

He was a founder of the Coalition for Responsible Transportation, an industry-wide organisation committed to environmentally responsible practices across the supply chain.

Mr Keller was inducted into the International Maritime Hall of Fame in 2006 at the United Nations in New York.

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