A thousand ships could be fueled by liquefied natural gas by 2015 and perhaps 10,000 by 2020, says a new report, citing a combination of regulatory pressures and increasingly available and cheap fuel.
“With the development of infrastructure and IMO ratifications the fleet is expected to reach up to 1,000 vessels by 2015 but pick up rapidly to grow up to 10 times in the subsequent five years as the technology, infrastructure, and economics stack equivocally in favor of LNG propulsion,” says a summary from MECi, the Denmark- and India-based MEC Intelligence.
“Companies in all aspects of the maritime value chain – oil majors, terminals, ports, bunker suppliers, service companies, component producers, vessel owners and charterers – need to rethink their offerings.”
Costs will be low due to “abundant availability” of LNG, MECi says, with life-cycle operating expenses for newbuild LNG ships some 40% lower than those of fuel oil and MGO (marine gas oil) propelled vessels.
Infrastructure Is Key, Regulators Too
LNG prices will rise with power sector demand, but the increases are “not likely to be significant considering the new supplies from unconventional gas reserves.”
The major caveat is that inaction on regulations and infrastructure development delays could slow LNG ship deployment – but only for the short term. “An analysis of the existing LNG supply and terminal infrastructure shows ample availability of the fuel to be able to supply,” MECi says. “Bunkering infrastructure can be developed rapidly to meet the growing fleet.”
“LNG holds the key to a cleaner and more energy efficient future for the shipping industry,” MECi says. “This report cuts across the skepticism and complexity surrounding the adoption of LNG as fuel in the shipping industry.”
Maritime LNG Propulsion is priced at $1,200 U.S.
MEC stands for maritime, energy, and cleantech.