Teekay Gives its OK to ME-GI



Tony Bingham, Director of Business Development and Technology at TeeKay Shipping discusses the reasons his company chose MAN Diesel & Turbo’s dual-fuel, two-stroke ME-GI engine and their expectations for the future.

What was the background behind Teekay choosing the ME-GI engine?

At Teekay we believe that it is advancements in technology that will drive change in the shipping industry faster in the next ten years than it has over the last 20.  Teekay has been watching the development of the ME-GI engine for several years and has been involved in the qualification process with other ship owners and charterers.

Teekay went through a lengthy process of investigating the possibility of re-engining some LNG steam ships and it was during this project that the ME-GI solution showed itself to be a logical choice for the future.  The fuel savings it provided together with the extra gas that could be delivered to the customer by removing the steam plant resulted in an extremely attractive payback period.  The steam plant replacement project was the stimulus for us to investigate the use of ME-GI in a newbuild project.

We worked very closely with DSME over a two year period on the newbuild project and after confirming the design, economics and the readiness of the charterers to accept the new engine arrangement, we placed the order in December 2012 confident that these vessels would be the next generation of LNG ships.  In summary, when we set out on this project we wanted to:   

  • Reduce Drive Train Complexity   
  • Reduce Fuel Consumption   
  • Lower Opex Costs   
  • Deliver Customer Value

What specific considerations did you take into account in making your choice of engine?

In selecting the ME-GI we recognised a number of key factors:-   

  • The engine is based on proven technology in that the base engine is used in the majority of ships world-wide and Teekay had 96 of these engines in its own fleet at the time of ordering
  • The base engine has proven itself to be very reliable and is well known to our seagoing engineers, who are very confident in the engine.  The only new part was the fuel injection system which we worked on and qualified together with a number of other ship owners and charterers
  • The fuel consumption is significantly lower than a medium-speed diesel   
  • We looked at emissions and the future legislation and found the engine could be compliant 
  • We considered methane slip and the growing debate around the subject and found the engine to give the lowest slip of all the propulsion plants  
  • We also looked at the through life operational costs and established the engine to be the most economic of all the solutions available

What benefits do you expect to gain from using the ME-GI?

We expect to see a reduction in OPEX from this engine but significantly the ME-GI has given us a competitive advantage with an engine that burns 26 to 30 tonnes less fuel per day on a HFO equivalent basis than the most modern DFDE installations.  Whilst this is an advantage for us tendering for projects, it is really the customer who is benefiting from the fuel savings and reduction in OPEX.

Other, ME-GI-related advantages include:   

  • It is a well-known engine and our engineers have been very positive about the selection and look forward to the new vessels arriving into the Teekay fleet   
  • There will be a reduction in high voltage components in the engine room so we see a reduction in the safety risks associated with high voltage  
  • We will have vessels which meet and exceed the EEDI requirements making them the most energy efficient LNG ships available

How positively do you expect the ME-GI to impact on your fuel budget?

The fuel savings will be seen by the customer, however it is not just the fuel savings.  The design we have developed with together with DSME will result in the customer being able to deliver more cargo on an annual basis, thus improving their economics further.

Is it a challenge being an early adopter of this technology?

We have worked hard to promote the ME-GI technology through presentations to potential customers and as a result we have laid our design out for all to see.  The disadvantage of our openness has been that the competitive advantage has been short-lived with a steady increase in the adoption of the technology being realised.  We have found that charterers are very interested and complimentary on what we have done and our work has been validated by their own internal teams.  The industry will see variations on the theme as we move forward but we believe our solution is still the optimum arrangement ordered to date.  Over the last 12 months we have seen a shift in tenders being issued, with ME-GI technology now being specified as the sole propulsion solution for a charter or an option for serious consideration.

Generally speaking, how do you see the market developing in the future in terms of fuels and engine technology?

The future is going to be increasingly focused on efficiency and the environment, therefore engines that can operate on fuels which are less onerous on the environment are going to be key.  This may not be engines that just burn methane but will include other gas based fuels such as methanol, DME and LPG.  We are already looking for the next solution, the next step change in technology.  We cannot see it yet but as we said above technology is moving fast and we will be ready for it.

In light of this, how important will the ME-GI engine’s flexibility be?

The ME-GI has met and exceeded our requirements, it is technology that is proven, reliable and available today.  It is the most efficient solution available at the moment and the whole vessel design exceeds the Energy Efficiency Design Index specified for ships to be built in 2025.  We have a vessel that is going lead the next generation of LNG ship design and be competitive for many years to come.

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Source: MAN