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‘Virtual LNG pipeline’ to boost gas fuel use by boxships

Wed 18 Jan 2017 by Rebecca Moore

‘Virtual LNG pipeline’ to boost gas fuel use by boxships
Derak Thomas (AG&P): The use of LNG among Jones Act shipping lines could develop as it has done among ships in the Baltic

The growth of small scale LNG infrastructure and the launch of a bunker barge for boxships will boost the use of gas in the container ship sector, says AG&P’s head of advanced research, Derek Thomas

The use of liquefied natural gas (LNG) by container ships will be facilitated by AG&P’s plans to make the fuel more widely available via small scale infrastructure – and in addition the LNG bunkering barge to be used by US-based carrier TOTE’s new gas dual-fuelLed boxships is expected to help boost the use of LNG in this sector.

The barge is the first of its kind in the world and the first LNG bunkering barge in the US. AG&P subsidiary GAS Entec carried out the gas handling and design of the 4,000m³ barge. It will help container ships [in North America], especially those in the Jones Act trades; LNG use is expected to expand quite significantly. Indeed, the use of LNG among Jones Act shipping lines could develop as it has done among ships in the Baltic.

The barge is expected to be delivered soon. The TOTE Marlin-class vessels are being fuelLed by trucks while waiting for the barge. Fuel by LNG truck is not adequate for larger vessels; as a short-term solution it is ok, but you do not want trucks with LNG driving in and out of port, it is impractical. Shipowners prefer a bunkering barge as while they are loading and unloading they can be refuelled; they do not want to have to go to a separate facility [for the LNG]. 

AG&P is also building its first small-scale LNG carrier at its facility in Batangas in the Philippines. The vessel design has been finalised with a 16-month timeline to delivery. It will revolutionise the delivery of LNG in South East Asian island nations as well as having the potential to be used in India, China and the Caribbean, and on European waterways. One of the market drivers is a recognition of the need to break away from major, large-scale terminals and deliver LNG to a broader market in a cost effective manner.

LNG is now at a viable price in South East Asia, but what is lacking is the availability of mechanisms to deliver the fuel to non-traditional users. Large-scale infrastructure costs so much that LNG is priced out of the market. So simple, economic solutions are going to be key.

AG&P’s 4,000m³ workhorse LNG carrier is targeting locations which require shallow draught and do not have tugs and sophisticated dockside facilities. The aim is to extend the vessel’s capability by using different equipment packages added to the base platform. AG&P is also looking at building multiple units in parallel and making them available on a leased basis. This innovative commercial approach is equally as important as the technology in opening these new markets.

The planned vessel is part of AG&P’s ‘virtual pipeline’ concept. There is a demand for LNG but the infrastructure is not in place to deliver it, and in many locations it is physically and economically unfeasible to construct gas pipelines.

As part of this concept the company is developing a range of smaller vessels and terminals to deliver LNG to locations without direct access to pipeline gas, thereby developing a virtual pipeline. This will support the take up of LNG by container ships.

There is also a need in the USA for small-scale liquefaction facilities that can serve as peak shaving plants as well as being a local source 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. The targets are major port locations serving Jones Act trade and cruise ships, particularly in the Pacific Northwest, such as Tacoma in the USA and Vancouver, Canada.