From next year, shipping firms will have to cut polluting sulphur
emissions in vessels going to parts of Europe and North America,
sparking a race for alternatives to standard diesel between fuel
sources such as methanol and liquefied natural gas.
As well as being considered a green fuel, methanol is potentially
cheaper and more plentiful than diesel or LNG.
But it is trickier to handle than some fuels, such as diesel, due to
its lower flashpoint -- the temperature where it vaporizes and could
ignite -- so needs care to prevent fires.
"Compared with LNG as an alternative shipping fuel we see methanol
in an early stage of development," said Thomas Wybierek, a shipping
analyst at Norddeutsche Landesbank.
Methanol is currently more costly than diesel and less efficient to
burn, though prices could come down as new projects to produce it
come on stream.
South Korean and Japanese shipyards recently won the first orders
for ships running on methanol. Engines, using 95 percent methanol
and 5 percent diesel, are being developed and should be delivered in
mid-2015, said engine builder MAN Diesel & Turbo.
"From a risk perspective I can't see that methanol has any drawbacks
as compared to LNG," said Joanne Ellis at Swedish maritime transport
consultant SSPA, which is working on one of two research programs
looking at methanol as a marine fuel.
Methanol can be stored in existing tanks on ships and since it is
not kept under pressure will not expand and explode in the way LNG
could, she said.
Because LNG is super-chilled it also needs special tanks and could
freeze ship equipment or cause injuries if it leaked.
Draft safety guidelines should be finalised this year for ships
powered by fuels with low flashpoints such as methanol, the U.N.'s
International Maritime Organisation (IMO) said.
RACE WITH LNG
There are about 50 LNG-fuelled ships operating globally, excluding
dual-fuel LNG carriers. This will double with around 55 LNG-fuelled
ships on order as firms in emission control areas opt to use LNG to
comply with tougher IMO rules on emissions.But a lack of LNG
refueling infrastructure at ports and the tanks needed to store it
on ships, taking up space for cargo, are obstacles to its wider use,
some experts say.
On the other hand, methanol can be stored in existing fuel tanks and
transported to port by road tanker. It is usually produced from
natural gas, though can also be made from biomass, carbon dioxide
and even household rubbish.
Total methanol demand was 66 million tonnes in 2013, data from
consultancy Jim Jordan and Associates showed, while demand for
marine diesel was 372 million tonnes, according to OW Bunker, a
supplier of the fuel.Shipping firms will have to cut emissions of
sulphur dioxide in emission control areas in Europe and North
America from the current 1 percent to 0.1 percent from next year
under IMO rules.
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Global IMO curbs will lower emissions to 0.5 per cent in 2020 or
2025 from the existing 3.5 percent.The controls have led shipping
firms to consider alternative fuels as methanol, which is sulphur
free and has low levels of nitrogen oxide, as well as low-sulphur
diesel and LNG.Methanol is cheaper than LNG, which costs between
$900 and $1,100 a tonne, including port and storage costs, according
to maritime services consultant Poten & Partners.
Methanol is priced at $460-$560 per tonne, but twice as much needs
to be burnt to generate the same energy as marine diesel, said
Michael Teusch, business development manager at Danish catalysts
firm Haldor Topsoe. Marine diesel costs about $600 a tonne, though
with low sulphur it is much more expensive.
TANKERS AND FERRIES
Japan's Minaminippon Shipbuilding Co., and South Korea's Hyundai
Mipo Dockyards Ltd are building seven methanol-fuelled tankers due
to be completed in 2016.
Three of the vessels, costing $140 million in total, will be owned
by Japan's Mitsui OSK Lines, the company said.
The ships have been chartered by Canada's Waterfront Shipping
Company, a subsidiary of Methanex Corporation, the world's top
supplier of methanol.
There is also a trial, partly financed by the European Commission,
starting early next year using methanol to help power a ferry. If
successful a fleet of methanol-powered ferries could be operating in
Europe and Scandinavia by 2020.
George Cambanis, who heads Deloitte's Global Shipping and ports
group, said that the host of players involved in various biodiesel
projects for ships from engine manufacturers to ship safety
classification society Lloyd's Register meant methanol was likely to
be used more in the future.
"How soon the future comes is anybody's guess," he added.
(Editing by Ed Davies)
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