LNG as a FUEL What’s current & What’s Next Tony Teo / Peter Bant , Det Norske Veritas (Canada) Ltd. April 2012 Agenda Existing Short Sea Shipping IMO - Update Future “GREEN” Ships What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 2 Background - Environment Are ships built today prepared for stricter air pollution regulations? Geiranger Fjord What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 3 LNG Background- DNV’s History • 1959 DNV Establishes a LNG Research Team. • 1962 Membrane cargo containment system developed and tested successfully. • 1962 First Class Society to establish Rules for Gas Carriers. • 1969 -72 Moss spherical tank design developed. • 1972 Basic design criteria for TYPE B tanks formulated in the Rules. • 1970-1976 DNV was prime contributor to the development of the IMO Gas Carrier Code. • 2001 First Class society to publish rules for Gas Fuelled Engine Installations. • 2003 First class society to publish rules for CNG carriers. • 2004 Technical guidance for offshore LNG terminals. What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 4 NORWAY – NOx FUND In 2000 Norway introduced a NOx TAX on emissions. In 2008 Norway introduced a NOx FUND. The FUND is financed by its members paying NOK 4 per kg NOx emitted, encouraged by the exemption from the Norwegian NOx Tax of NOK 16 per kg NOx emitted. NOx fund has granted funding to two supply vessels / three passenger ferries and one gas carrier, and fifteen (15) additional LNG fuelled vessels have been granted funding. LNG fuelled ships are eligible for NOK 150 per kg NOx yearly emission reductions, limited to 75%of the additional cost of LNG propulsion. What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 5 1st Gas fuelled Ferry, January 2000 Prototype • Capacity: 300 pax and 96 cars Passenger/car ferry “GLUTRA” Engines:4 Mitsubishi Engs. @ 2 bars Speed: 12 knots International Gas Fuel Code: 2000 DNV Rules 2006 Initiated in IMO 2009 IMO Interim Guidelines (w/similar DNV Tech contents) 2010 Other Class issue Rules 2014 IGF Guidelines What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 6 “GLUTRA” Refuel: 6 Days 2 x 1000 ft3 Lesser of B/15 or 2m. Lesser of B/5 or 11.5m. What's CURRENTand What's NEXT! Min 760mm Min 760mm April 2012 © Det Norske Veritas AS. All rights reserved. 7 12 more Ferries ordered from 2007 Capacity: 587 pax / 212 cars Speed: 21 knots with 2x16 cyl, 3530kW + 2x12cyl, 2650kW Engine: Rolls Royce, Bergen What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 8 Passenger Ferries, 2009 Capacity: 600 passengers Engines: 2 x 6 cyl., 380 kw Mitsubishi Max Speed: 12 knots Tank Size: 1000 cu ft Refueling: 7 days Refueling time: 1 hour “Tide King” “Tide Queen” “Tide Princess” What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 9 Tank Room Arrangement • VENTILATED, VACUUM • GAS DETECTION, COLD BOX, Gas: INSULATED • BILGE WELL ALARM GAS+15 DETECTORS C TANK DUCT PIPE - GAS LINE, • VENTILATED, • GAS DETECTORS Block / Bleed valve MAINTAINS TANK PRESSURE What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 10 Bunkering Arrangement & Piping Drip Tray Manual / Remote Valve P P Gas detectors Ventilation GD to open air GD M •Operational procedures •Emergency procedures Min. 760 mm Duct withstand pressure from rupture To gas tank Requirements: Means for draining fuel at completion Lines arranged for inerting and gas freeing Gas line color coded Electrically bonded to hull What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 11 OSVs with Wartsila DF Engines, 2003 Reduction in NOx emission = 20,000 cars “LADY VIKING” “VIKING ENERGY” STRIL PIONEER LADY VIKING “STRIL PIONEER” What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 12 High Speed Light Crafts Builder: Myklebust yard, Norway Owner: Buquebus, Montevideo 3 Norwegian CG patrol crafts 1000 pax ferry, Argentina/Uruguay Power Generation: DF (Gas + Diesel) GE LM 2500 Gas Turbine Max Speed: 20 knots, Range: 7 days 50 knots What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 13 4 RoRo ship on Order, 2008 & Coaster 2011 Fish Farm Product Vessel Engine: RR Bergen. Dwt: 2000 tonnes Tank: 90m3 Type: RoRo/Containers Main Engine: RR Bergen 35:40, V12, 5250 kw, 15 knots Capacity: 94 TEU, Tanks: 430 m3 What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 14 Ferry Terminal and LNG Storage & Refueling Area (Bergen) Luxury Waterfront Cottages Ferries’ LNG BunkerStation LNG Storage Tanks Safety Culture What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 15 26 LNG fueled ships in operation worldwide Ships in operation Year Type of vessel Owner Class 2000 Car/passenger ferry Fjord1 DNV 2003 PSV Simon Møkster DNV 2003 PSV Eidesvik DNV 2006 Car/passenger ferry Fjord1 DNV 2007 Car/passenger ferry Fjord1 DNV 2007 Car/passenger ferry Fjord1 DNV 2007 Car/passenger ferry Fjord1 DNV 2007 Car/passenger ferry Fjord1 DNV 2008 PSV Eidesvik Shipping DNV 2009 PSV Eidesvik Shipping DNV 2009 Passenger ferry Tide Sjø DNV 2009 Passenger ferry Tide Sjø DNV 2009 Passenger ferry Tide Sjø DNV 2009 Patrol vessel REM DNV 2009 Car/passenger ferry Fjord1 DNV 2010 Patrol vessel REM DNV 2010 Car/passenger ferry Fjord1 DNV 2010 Patrol vessel REM DNV 2010 Car/passenger ferry Fjord1 DNV 2010 Car/passenger ferry Fjord1 DNV 2010 Car/passenger ferry Fosen Namsos Sjø DNV 2011 PSV DOF DNV 2011 Chemical tanker Tarbit Shipping GL 2011 Car/passenger ferry Fjord1 DNV 2011 PSV Solstad Rederi DNV 2012 Car/passenger ferry Fjord1 DNV What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 16 29 confirmed LNG newbuilds Confirmed orderbook Year Type of vessel Owner Class Year Type of vessel Owner Class 2012 General Cargo Nordnorsk Shipping DNV 2014 Car/passenger ferry Society of Quebec ferries LR 2012 PSV Olympic Shipping DNV 2014 Tug Buksér & Berging DNV 2012 PSV Eidesvik DNV 2014 PSV Harvey Gulf Int. Marine ABS 2012 PSV Eidesvik DNV 2014 PSV Harvey Gulf Int. Marine ABS 2012 Ro-Ro Sea-Cargo DNV 2012 Ro-Ro Sea-Cargo DNV 2012 High speed RoPax Buquebus DNV 2012 PSV Island Offshore DNV 2012 PSV Island Offshore DNV 2012 PSV REM DNV 2013 General Cargo Eidsvaag 2013 Car/passenger ferry Norled 2013 Car/passenger ferry Norled 2013 Ro-Ro Norlines DNV 2013 Ro-Ro Norlines DNV 2013 Car/passenger ferry Torghatten Nord DNV 2013 Car/passenger ferry Torghatten Nord DNV 2013 Car/passenger ferry Torghatten Nord DNV 2013 Car/passenger ferry Torghatten Nord DNV 2013 RoPax Viking Line LR 2013 Tug Buksér & Berging DNV 2013 PSV Harvey Gulf Int. Marine ABS 2013 PSV Harvey Gulf Int. Marine ABS 2013 Patrol vessel Finish Border Patrol 2013 Car/passenger ferry Society of Quebec ferriesLR What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 17 IMO – ECA zones What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 18 IMO – MARPOL- TIER LEVELS Air Pollution Prevention – MARPOL ANNEX VI Changes are a progressive reduction globally in emissions of SOx, NOx, and PM and the introduction of emission control areas (ECA’s). TIER I and II requirements are for marine diesel engines emission limits for engines installed on or after 1 January 2011. TIER III requirements:- MORE STRINGENT emission limit for engines installed on or after 1 January 2016 operating in ECA’s. What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 19 IMO – MARPOL - BUNKERS Past level 4.5% sulphur. Now ( I January 2012) : 3.5% sulphur content. NEXT: progressively to 0.5% Sulphur content by 1 January 2020. In ECA’s the limits were reduced to from 1.5% to 1.0% beginning 1 July 2010, and will be further reduced to 0.1% by 1 January 2015! Todays prices for HFO with LS are approaching USD700+ per ton; NEW LARGE CONTAINER SHIPS can consume 240t+ PER DAY! = USD168,000 per day for fuel alone! ( 11day crossing + 1.84Million Dollars). What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 20 IMO DK GROUP ONE SHIP POLLUTES AS MUCH AS 50 MILLION CARS - By Jorn P. Winker, Founder - In 2007 it was established that the maritime industry accounted for emission of approx. 1.2 BILLION Metric Tons of CO2 annually. - Latest figures the maritime Industry will be responsible for emitting at least 1.5 BILLION tons of CO2 annually (2010) and be substantially over 2 BILLION tons by 2015. On top of this…20 MILLION tons SOx and 37 MILLION tons of NOx What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 21 New requirements to Energy Efficiency from 2013 Apply to new ships above 400 GT: - Building contract on or after 1 January 2013 or - Keel laid on or after 1 July 2013 or - Delivery on or after 1 July 2015 The index is defined as: grams CO2 / capacity * nautical mile Environmental cost Attained design CO index 2 Benefit for society What's CURRENTand What's NEXT! April 2012 © Det Norske Veritas AS. All rights reserved. 22 Further Reductions Container ships 40 35 30 25 20 EEDI 15 10 Tentative reference line - to be updated Required EEDI: 2013-2015 Required EEDI: 2015-2020 5 Required EEDI: 2020-2025 Required EEDI: 2025- 0 0 5 000 10 000 15 000 20 000 25 000 30 000 Dwt • Existing ships: Ship Energy Efficiency management Plan (SEEMP) => Energy Efficiency Operational Indicator => Best practice.