Building the Future North Europe LNG Infrastructure Project Mogens Schrøder Bech Danish Maritime Authority

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1 Clustering the Motorways of the Sea in the Baltic Sea 12 April 2011 Building the Future North Europe LNG Infrastructure Project Mogens Schrøder Bech Danish Maritime Authority

2 The project in short The challenge Short term - ECA provisions Long term - Greening of transport New competitive fuels as LNG are needed The chicken and egg problem Equipment manufactures Shipowners LNG providers An LNG infrastructure is needed Hard on marine filling stations Soft on regulations, industry standards, etc.

3 A supply chain point of view Reception of LNG and/or liquefaction of natural gas from the gas grid Storage and distribution of LNG The use of LNG in ships Reflects the need for a hard and soft infrastructure point of view

4 Basis of the infrastructure project - Central enablers for the use of LNG Safety Local municipalities and public awareness Technical possibilities for fuelling ship engines with LNG Fuelling of other means of transport than ships from maritime LNG filling stations LNG filling station dimensions Economy as seen by a ship, a port and an LNG provider The LNG market The potential for LNG

5 Central enablers 1/5 Safety A ship, a port and an LNG provider point of view Regulations Industry standards Local municipalities and public awareness Land use and safety measures From a specialized industry with large terminals to a more decentralized maritime industry

6 Central enablers 2/5 Technical possibilities for fuelling ship engines with LNG New engines Retrofitting Fuelling of other means of transport than ships and industry, etc. from maritime LNG filling stations Economies of scale

7 Central enablers 3/5 LNG filling station dimensions The supply of LNG to the filling stations Integration with the natural gas network Different layouts From mobile land as well as sea based to fixed stations Scaling possibilities Legal, financial and operational models Neutral access to the service Bunkring of different ship types Volume, time and safety, etc A map of strategic ports for LNG filling stations

8 Central enablers 4/5 Economy as seen by a ship, a port and an LNG provider Economies of scale Second-hand prices, new builds and retrofits Pay-back periods Internal return on investment The relation between contracted volume and price The LNG market Possible price developments of LNG compared to 0.1% sulphur fuel Markets spot, short-term, medium-term and long-term and expected developments

9 Central enablers 5/5 The potential for LNG in Northern Europe Starting points Existing lines in the Baltic, the North Sea and the English Channel Tramp shipping problematic Ship characterization age and size, etc. Other modes of transport relevant for LNG filling stations in ports A two-track measurement of the potential For partner countries and ports a detailed approach, and in particular for liner shipping For other countries a general estimate Development of a framework for an operational methodology Addressing the potential for the single port and/or port cluster

10 From enablers Recommendations For central stakeholders Shipowners, ports, LNG providers, industry organizations, countries, EU, IMO, etc. Basis for Policy-making Regulations, industry standards and co-operation Commercial decisions The business case A horizontal issue for the infrastructure project Concerted action is needed

11 Partners States: Belgium, Denmark, Finland, Sweden and Norway Regional: Council of Nordic Ministers Ports: Port of Hirtshals (DK), Port of Zeebrugge (BE) and Szczecin and Swinoujscie Seaports Authority (PL) LNG terminals and gas distribution companies: Fluxys (BE), Gasum (FI), Gasunie (NL), Energinet.dk (DK), Energigas Sverige (SE) and Gasnor (NO) The Maritime Cluster: Germanischer Lloyd (DE), Bureau Veritas, MAN Diesel and Turbo (DK), Lauritzen Kosan A/S (DK)

12 Project structure Steering group Contributing partners Reference group You are wellcome to join The aim of the structure To engage To get input To create commitment and disseminate The overall LNG perspective To chart the LNG infrastructure course in Nort Europe To chart a template for LNG TEN -T Motorways of the Sea projects To chart the LNG course in the EU - coming calls!

13 The time schedule An EU application submitted 31 August 2010 In kind contributions an important element Adopted December 2010 Consultancy work starts up early May 2011 End 31 March the infrastructure part End 31 March the pilot project

14 Sum up the infrastructure project We have identified the critical enablers An analysis will be carried out LNG infrastructure recommendations Hard on marine filling stations Soft on regulations, industry standards, etc. Validated through the industrial partners The business case a horizontal issue What will happen after the project has finished? Depends on the recommendations!

15 Thank you for your attendance