Liquefied natural gas is a liquid fuel created by cooling natural gas to its boiling point, paired with Bunkering, the process by which a maritime vessel is provided with fuel for its own re-fuelling purposes; LNG becomes much cleaner than marine gas oil or heavy oil, and has a stable price forecast for the next few years. It does, however, require the more costly storage needed to maintain its stability as a liquid.

The infrastructure required for handling and storing LNG is very different to that needed for fuel oil – as LNG is essentially a perishable resource due to its super-cooled nature. The logistics and implementation required often exacerbates the general lack of understanding of LNG, and makes the inception of a truly global supply chain of LNG difficult.

The cost of meeting regulations is often a barrier to firms considering converting vessels, or switching large parts of their enterprises to LNG capability. The EU, US government, and International Maritime Organisation are just three groups that have introduced regulations to limit shipping emissions. 

Whilst preferable to alternatives in the wake of the 0.1 per cent ECA sulphur limit, the 2016 NOx guidelines, and in the face of the upcoming 2020 sulphur cap, LNG may be more hassle than it’s worth for some companies. The IMO’s concerns about LNG, despite finding it feasible from an environmental perspective, are a helpful indicator of the wider global concerns.

One regulation that is worth highlighting, however, is the 2020 sulphur cap. This global cap will essentially limit vessel owners to choosing between expensive and compliant fuels, using clean LNG, or installing scrubbers to clean their exhaust gases, whilst refiners are expected to alter the configuration of their sites. For LNG to be chosen as the primary course of action,

LNG has been used since the Second World War, but catastrophic events such as the Cleveland plant incident effectively killed the project before it had truly begun. In the mid-1960s, however, the first LNG carrier was commissioned, and the industry was reinvigorated. Since then, both LNG carriers and cruise vessels have been working without a single major incident.

The fuel itself is harmless to wildlife in the event of a spill, with no significant examples of spills to date. It is cheaper to insure than oil as a result of its strong safety reputation and non-toxicicity. However, it is incredibly hard to detect the flammable vapour LNG gives off – so whilst it is no more of an ignition risk than other fuels, accidents due to human error could be more likely to occur – but there is currently no data to support this.

Using LNG as a marine fuel has the greatest positive impact on the environment, as it replaces the burning of marine diesel and HFO – both of which produce high level of CO2, NOx, and air particulates. LNG does produce carbon dioxide, but in lower quantities, and produces only a negligible level of other pollutants – including sulphur. The current average sulphur content of residual fuel oil – LFO, MFO, or HFO – is around 2.5 per cent, which is well below the 3.5 per cent cap, but will soon be five times the limit. Distillate fuels, including LNG, have an average of less than 0.1 per cent – a far more future-proof level.

Through anaerobic digestion, biomass will be the key to reducing the fuel’s CO2 emissions to zero, making LNG 100 per cent renewable, and improving upon standard LNG’s 25 per cent reduction in CO2 and 80 per cent reduction in NOx

The IMO’s reports have examined specific shipping and cruise routes – in the North American Emission Control Area and the Caribbean – and found LNG to be environmentally preferable to marine gas oil, heavy fuel oil, and the use of scrubbers. However, the financial conclusion is less definite

With extremely large operators currently facing financial, regulatory, and environmental burdens, adoption of LNG by even a small number of these companies could drastically change the global market strengths of LNG.

There is little debate about whether or not LNG will endure. Its viability and potential cost savings have been definitively identified – and the perceived chicken-and-egg stand off between infrastructure and vessel developers is anticipated to resolve itself in the near future. Impasses rarely last when there is sufficient market potential, and there are a few catalysts for change that are unique to LNG.

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