LNG as fuel. OTMW-Module 5 Monday 23 rd of November 2015 University of Piraeus. Working together for a safer world

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1 LNG as fuel OTMW-Module 5 Monday 23 rd of November 2015 University of Piraeus Working together for a safer world

2 What is LNG?

3 Economical Drivers Regional - US LNG export dynamics - ECA-NOx area - USCG policy to LNG as Fuel - Strong Private Equity investing on Gas Market - Panama Canal new ports - Asia LNG price pressure to the economy - Australia exports growing - Public perception of going back to nuclear energy - China LNG demand growing - LNG strong imports in Korea and Japan - LNG Bunkering Hubs - LNG initiatives - Future ECA-NOx - Norwegian funds - EU LNG funds - Developing strong LNG bunkering hub - Growth in LNG imports - Technology innovation

4 Emission Control Areas (ECA s) and more American ECAs: Regional emission control European ECAs Future ECAs?? 5

5 LNG vs Fuel Oils 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% NOx SOx CO2 LNG Oil Fuels

6 Storage Requirements Low Temperature (-163 C) High expansion ratio of 600:1 Physical Properties ~60% increase in fuel volume

7 What are the choices? LSFO HFO with emissions abatement LNG Alternative fuels Why start with a dirty fuel and then clean it? What other reasons are there for looking at alternative fuels? Longer term oil prices are expected to continue to increase 8

8 The alternatives Non-conventional energy: Solar, Wind, Nuclear, Fuel Cell Combustible fuel: DME Highly flammable Processed onboard Precursor to Methanol Hydrogen Containment Very highly Flammable Cryogenic (larger installations) Feedstock reformed onboard? Methanol Normal fluid Toxic Invisible flame Waste product or derived from NG

9 LNG as fuel and LNG Bunkering OTMW-Module 5 Monday 23 rd of November 2015 University of Piraeus Working together for a safer world

10 What is currently out there? Global Fleet: ~37 LNG powered vessels in service Majority small ferries and off shore support 70% built/converted since 2009 ~ 30 more in next 2 years Lloyd s Register: Oldest dual fuel vessel (1982) First dual fuel IWW tanker (2011) Largest LNG fuelled vessel to date Viking Grace (2013) Largest and most complex LNG passenger vessel First LNG Safe-Return-to-Port 10+ other LNG projects Cargo & Passenger 11

11 Bunkering Methods Truck to Ship Ship to Ship Pipeline to Ship Gas-Fuelled Vessel 12

12 Truck to Ship (TTS) Small volume bunkering (100m 3 /hr maximum transfer) ISO tank = 40m 3 Bunkering same side of vessel as other operations Low infrastructure cost 13

13 Ship to Ship (STS) Mature technology from LNG tankers Larger transfer rates Bunkering opposite side safety exclusion zones Cost of bunker vessel Compatibility 14

14 Pipeline to Ship (PTS) Regular routing Larger volume & transfer rate Direct from terminal or re-fillable shore storage tanks Infrastructure cost 15

15 What are the Issues and Design Considerations for LNG Bunkering Risk Management Compatibility Control of operations Safety and Communications Cryogenic protection/leak prevention Flexible hoses

16 Risk management Complex operation Risk assessments as part of pre LNG Bunkering procedure Emergency Planning Vessel Compatibility Regulations Location & Environment Equipment Personnel 17

17 Compatibility Physical connection: Bunker / Vapour / IG Manifold heights Emergency systems ESD & communications Hazardous areas Overlap between bunker vessel/truck/shore facility and ship Ventilation etc. Bunker Vessels should have a defined list of gas fuelled ships that it can safely bunker. The different types of ships should form part of the bunker vessel Risk Assessment 18

18 Control of operations Master(s) In charge of manoeuvring Person(s) in Overall Advisory Control (POAC) In charge of bunkering operations on each vessel Agree mooring arrangement Supervise connection & disconnection Ensuring safe procedures purging & leak testing Monitoring fuel transfer / Vapour management Security (ISPS) Exclusion zone according to local regulations Suspend and separate upon breach of security 19

19 Flexible hoses Alternative to marine loading arm Should be sized for application & fully supported 20

20 Where and When to bunker? Weather Terminal restrictions Simultaneous operation subject to port constraints Opposite side? Dependent on surrounding vessels? Estuary Terminal & Port : Class / Flag / Port/ Land Regulatory Authorities 21 FLNG Offshore Location: Class / Flag/ National Field Authority Lightening Bunkering & Regas In-shore Waters: Class / Flag / Port Authority /Coast Guard

21 What is the current regulatory framework for LNG as a fuel? Rule and Regulation Development SOLAS II-2 regulation limits the flashpoint of oil fuels to 60 or higher Current designs must comply with SOLAS, MSC.285(86) and National Administration requirements SOLAS II-2 regulation 17: Alternative Design and Arrangements IGC Safe carriage by sea of bulk liquefied gasses Resolution MSC 285(86) Interim Guidelines on Safety for Natural Gas-Fuelled Engine Installations in Ships (2009) Lloyd s Register Rules for the Carriage of Liquefied Gasses in Bulk Draft IGF Code Lloyd s Register Rules for the Classification of Natural Gas Fuelled Ships (July 2012) IGF Code Lloyd s Register Rules for the Classification of Natural Gas Fuelled Ships (July 2014) 22

22 Concluding, Take aways 1. This is not just about compliance, it is about building the right, safe and efficient operation, 2. Engagement is of paramount importance, shipowners, designers and class must actively work together since day one 3. LNG as marine fuel is feasible from technology aspects but much will depend on robust concept and right scale

23 Anna Apostolopoulou Marine Strategy and Implementation Manager E: Yvonni-Effrosyni Damianidou Business and Technical Support Specialist E: Hellenic Lloyd s SA Akth Miaouli 87 Piraeus, Athens-Greece Working together for a safer world Lloyd s Register and variants of it are trading names of Lloyd s Register Group Limited, its subsidiaries and affiliates. Copyright Lloyd s Register Group Limited A member of the Lloyd s Register group.