Tanker and Bulker Owners Turn to LNG

In the last of our four sector-specific reports on LNG-fuelled tonnage, Mike Corkhill reports on marked growth in interest in cleaner-burning fuel from owners of tankers and bulkers.

In terms of LNG-fuelled newbuilding completions and orders over the past 12 months, the most dynamic segment has been tankers and bulk carriers. Following the delivery of 13 ships, there are now 19 tankers and bulkers in service. Contracts for 17 new vessels augmented this activity and boosted the tanker and bulker orderbook to 28 ships as of 20 March 2017.

According to LNG World Shipping’s latest review of the global fleet of LNG-fuelled seagoing vessels, the past year’s notable shipyard handovers include a four-ship series of 15,000 dwt chemical/product tankers, built by Avic Dingheng for Terntank’s Baltic Sea service and four 35,000m3 ethane carriers.

The latter complement comprises three vessels for Navigas and one for Ocean Yield and operation in the Gaschem pool.

The Terntank vessels and the ethane carriers are also noteworthy for their low-speed dual-fuel propulsion systems. The Terntank quartet are the first ships to be propelled by low-pressure two-stroke dual-fuel engines, in this case supplied by Winterthur G&D, while high-pressure MAN gas-injection engines were specified for the ethane ships.

The ethane carriers may never have occasion to burn LNG. When dual-fuel diesel engines were introduced as a viable propulsion system option a decade ago, the initial focus was on LNG carrier applications to enable the units to run on cargo boil-off gas (BOG).

However, manufacturers soon adapted their engines with a few minor adjustments to enable them to run on other hydrocarbon gases, including ethane. The new generation gas tankers being built to carry US ethane exports, including the four ships mentioned above, are all burning cargo BOG in their engines.

Thanks to the shale gas revolution, US ethane is a plentiful, low-cost product while the ability to use cargo BOG as propulsion system fuel simplifies ship operations. It also gets around the problem of securing a supply of LNG at a time when the development of the necessary bunkering infrastructure is in its infancy. 

Among the recent orders for tankers and bulkers is a major play by the Baltic Sea operator Gothia Tanker Alliance. Between them, Furetank, Älvtank and Thun Tankers, the three members of the Alliance, have ordered 10 chemical/product tankers, comprising six of 16,300 dwt and four of 8,000 dwt.

A Sovcomflot order for four Aframax tankers of 114,000 dwt at Hyundai Mipo also merits a mention. Announced in March 2017, the contract highlights the fact that gas-burning engines are now gaining favour as a propulsion system for larger ships, including those whose sphere of operations is not limited to a dedicated route.

Although the LNG bunker tank capacity of the Sovcomflot tanker quartet is yet to be announced, each would require about 5,500m3 of space to provide the vessel with the same amount of energy contained in the heavy fuel oil tankage typically specified for an Aframax tanker.

LNG-fuelled tankers and bulkers, in service and on order, March 2017

* conversion project

DF: medium-speed dual-fuel

HPLSDF: high-pressure, low-speed dual-fuel

LPLSDF: low-pressure, low-speed dua-fuel

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Source: LNG World Shipping, March 2017

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