Shell, Qatar Petroleum to tap shipping move from bunker fuel to cleaner natural gas

Shell is the largest LNG vessel operator in the world. Image: Shell

Qatar Petroleum’s Wave LNG Solutions and Shell Gas & Power Developments B.V. will jointly develop liquefied natural gas (LNG) marine fuelling – or bunkering – infrastructure at strategic shipping locations across the globe.

LNG bunkering provides the shipping industry with a new fuel that helps meet the industry’s environmental and economic objectives, the companies said.

Increasing numbers of ship owners and operators are turning to LNG over traditional marine fuels in response to tighter sulphur and nitrogen oxide emissions regulations. In October 2016, the International Maritime Organization (IMO) announced the introduction of a global 0.5 per cent sulphur cap from 2020.

“We view LNG bunkering as a promising opportunity for LNG to further grow as a clean energy source,” Saad Sherida Al-Kaabi, Qatar Petroleum’s president and chief executive officer, said in a statement. “LNG demand for bunkering is expected to increase significantly over the coming years and we believe there is real potential for such demand to reach up to 50 million tonnes per annum by 2030.”

Shell has taken several moves to bolster the use of LNG for shipping, including the recently announced deal with Sovcomflot to supply LNG for the world’s first LNG-powered Aframax crude oil tankers. The ships will operate in the Baltic Sea and Northern Europe, transporting crude oil and petroleum products.

Shell will also supply the world’s first LNG-powered cruise ships following an agreement with Carnival Corporation & plc. When completed, the two vessels will be the world’s largest passenger cruise ships and will enter service in northwest Europe and the Mediterranean in 2019.

In addition, Shell is the first customer of new infrastructure dedicated to providing LNG for transport at the Gas Access to Europe (Gate) terminal in Rotterdam, The Netherlands, and the company is building an innovative sea-going vessel with a capacity of around 6,500 cubic metres that can refuel LNG-powered ships in the Rotterdam area and at other locations.

On his part, Ben van Beurden, Shell’s chief executive officer, said: “As two of the world’s leading LNG suppliers, Shell and Qatar Petroleum have the capability and experience to deliver LNG as a marine fuel to ship owners and operators who must meet tougher emissions regulations from 2020.”