Global energy disruptions boost seaborne LNG demand, driving record orders for carriers until 2027. Three generations of technology exist in the 650-ship deep-sea LNG fleet, with recent vessels favouring basic designs. However, evolving carbon efficiency regulations pose a risk, potentially making certain vessels less employable in the future. Industry success relies on adapting to environmental regulations and prioritizing advanced technologies to avoid potential “stranded assets.”
Surge in LNG Demand: Record Orders, Limited Shipyard Capacity
The global push for seaborne LNG as an alternative energy source has led to an unprecedented demand for LNG carriers. With over 240 carriers on order, shipyards in South Korea and China are fully booked until 2027, posing a challenge to meeting the surge in demand.
Evolution of LNG Carrier Technology: Generational Shifts and Efficiency Challenges
The current 650-ship deep-sea LNG fleet spans three generations of technology: steam turbines, dual-fuel diesel-electric engines, and the latest two-stroke engines. The newer generation vessels, set to be delivered by 2027, incorporate advanced technology for efficiency. However, the surge in demand has led to a focus on basic specifications, potentially impacting carbon efficiency and future employability.
Carbon Efficiency Concerns: Implications of CII Regulations on LNG Carrier Viability
As the International Maritime Organization’s carbon efficiency indicator (CII) regulations come into force in January, LNG carriers face challenges in maintaining or improving their efficiency grades. The cost-driven approach to building basic LNG carriers, coupled with the future inclusion of methane slip in CII assessments, raises concerns about potential stranded assets in the LNG shipping sector.
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Source: LR
