Gas in Martime

Gas: CUTTING EMISSIONS

AND POLLUTION IN MARITIME TRANSPORT

Introduction

• LNG, bioLNG, eLNG, hydrogen and ammonia1 have a crucial role to play in the EU transport sector, including maritime transport.
• LNG is readily available and delivers important air

quality benefits, with deep reductions in sulfur oxides (SOx), nitrogen oxides (NOx) and particular matter (PM).

> Alongside bioLNG and eLNG, LNG allows significant reduction in CO2 and GHG emissions of vessels on a TTW (Tank-to-Wake) and WTW (Well-to-Wake) basis2.

Eurogas key policy recommendations

• The EU should increase focus on promoting LNG, bioLNG and eLNG to reduce emissions from maritime transport.
• Eurogas believes the following elements are crucial to boosting the use of these fuels:
• • All EU policies should ensure a level playing field and assess solutions objectively along the complete value chain, including refuelling and distribution infrastructure.
  • The EU framework needs to recognise the Well-to- Wake emissions, to fully account for the contribution of fuels, as well as local emissions, performances of fuels, and the time needed for their deployment.
  • An economically efficient and well-planned approach that maximizes the value of existing assets to incorporate increasing shares of renewable and low carbon gases.

2.3 MILLION JOBS

created in the EU

Our DNV pathways study has shown how optimising the role of gas in the transitions can increase EU employment by 2050.

• The Alternative Fuels Infrastructure Directive (AFID) for LNG, bioLNG, eLNG and hydrogen uptake should be fully implemented. In the upcoming AFID revision, natural gas - liquified and gaseous - must remain an alternative fuel source.
• Taxation which fully recognises fuels' contribution to decarbonisation and environmental performance in the transport sector.
• The NOx, SOx and Particulate Matter (PM) Emission Control Areas (ECAs) must be extended to the whole European coastline3.
• Small-ScaleLNG infrastructure projects should be classified as sustainable within the European Commission's Sustainable Finance Programme.

1 There is ongoing work to certify as ammonia ready certain LNG tanks, allowing synergy between the two fuels - Bureau Veritas/GTT - 'NH3 ready' Membrane Tanks (February 2021)

2 Sphera -The definitive study on lifecycle analysis for LNG as a marine fuel - Sphera's 2ndlifecycle GHG emission study on the use of LNG as a marine fuel(April 2021)

3 To complement the North and Baltic Seas as NOx Emission Control Area (NECA) since 1 Jan. 2021. In practice, all new vessels built as of 2021 will be required to reduce their NOx emissions by 80% compared to the present emission levels when sailing in these areas.

4 DNV estimates based on the volumes projected in DNV study for Eurogas:European Carbon Neutrality: The Importance of Gas. Includes jobs for all types of gases, their supply, their transmission, distribution and trade for all end-uses.

Climate and air quality benefits

• Compared to conventional maritime fuel oils, LNG significantly reduces emissions from local pollutants5,6,7:
• • SOx emissions are reduced to near zero due to the very low sulphur content of LNG.
  • NOx and PM can be reduced by more than 90%.
• Compared to very low sulphur fuel oils, LNG significantly reduces GHG emissions, while accounting for methane slips8:
• • From the Well-to-Wake perspective, GHG emissions are reduced by 14-23% for 2-stroke slow speed engines, and by 6-14% for 4-stroke medium speed engines.
  • From the Tank-to-Wake perspective, GHG emissions are reduced by 20-30% for 2-stroke slow speed engines, and by 11-21% for 4-stroke medium speed engines.

If today's global marine transport completely switched to LNG, its GHG emissions would decrease by 15%2 compared with the fleet powered by fuel oils.

Taking into account improvements in reducing methane emissions in the LNG supply chain, this benefit could rise to 20% by 20302,10.

Blending with 20% of bioLNG could further reduce CO2 emissions by up to 34%9. Higher blending rate, use of innovative technology - such as fuel cells - and synergy with eLNG and the potential re-use of the (biogenic) CO2, could unlock even deeper decarbonisation.

Infrastructure and vessels global deployment

There are 206 LNG ships in operation and 295 on order (98 to be delivered in 2021). There are 142 LNG-ready vessels, either in operation or on order10. Currently, LNG-fuelledvessels constitute approx. 13% of the newbuild orderbook. LNG has penetrated nearly all ship segments - estimates for 2021 and beyond show continuing growth in many classes of vessels.

At the end 2020, there were

124 ports with LNG bunkering facilities. In 2022, that number will grow to at least 170.12.

1/3 Member States have set targets for LNG bunkering.

By 2026, the EU will have to establish an adequate number of LNG refuelling points in ports to ensure the circulation of inland waterway or seagoing vessels13.

5 Conventional maritime fuels oils i.e. Heavy Fuel Oil (HFO), Very Low Sulphur Fuel Oil (VLSFO) & Maritime Gas Oil (MGO)

6 LNG Protocol -Declaration for the Use of LNG as theGo-ToFuel of the Future(Oct 2019)

7 P. Gilbert, C. Walsh, M. Traut, U. Kesieme, K. Pazouki, A. Murphy -Assessment of fulllife-cycleair emissions of alternative shipping fuels, Journal of Cleaner Production, (Jan 2018)

8 Regarding methane slips in use, according to2:

• High-pressure2-stroke slow speed diesel cycle engines already have virtually no methane slip
• Low-pressure2-stroke slow speed Otto cycle engines ordered today offer a 50% reduction in methane slip
• For 4-stroke medium speed engines, methane reduction technologies such as oxidation catalysts or the implementation of high-pressure gas injection could reduce methane emissions by 70 %/90 % respectively. It has to be noted however that both technologies are currently in R&D and not commercially implemented yet.

For methane emissions in the LNG supply chain: they account today for 6% of the total WTW emissions but could be reduced in average by 15 % by 2025 and by 35 % by 2030. 9 EBA, GIE, NGVA, SEA LNG - BioLNG makes carbon neutrality a reality for EU transport(November 2020)

10 DNV GL - Alternative Fuels Insight Platform(Consulted in May 2021)

11 The Maritime Executive - The Outlook for LNG as a Marine Fuel(February 2021)

12 Clarksons Research -Clarksons: 27% of the order book to run on alternative fuels(December 2020)

13 Throughout the TEN-T Core Network

in 2030 in 2040

Gases will play an increasing role in all maritime applications

• Europe: According to EC projections the consumption of LNG, bioLNG and eLNG in maritime transport is expected to soar in the coming decades.

International		60
maritime fuels		50			Other liquids
mix in				Hydrogen
2030/205014		40			E-liquids
according to	Mtoe	30			E-gas
European			Bio-LNG
Commission		20			LNG
projections
	10			Liquid biofuels
				Heavy fuel oil
		0			Marine diesel oil
		BSL	MIX	BSL	MIX
		2015	2030		2050
Inland		5			Electricity
waterways		4
and national				Hydrogen
maritime	Mtoe	3			E-gas
fuels mix in	2			Biomethane
2030/205014				Natural gas
according to		1			Liquid biofuel
European				E-liquids
	0
Commission		MIX	BSL	Oil products
projections		BSL	MIX
		2015	2030		2050

>Global: The consumption of LNG is expected to strongly increase in the coming decades. According to IEA Net Zero by 2050 scenario, consumption of gas for maritime shipping (which includes both domestic and international operations) is expected to increase 7 times in 2030 and about 8 times by 204015.

Energy
SHIPPING	2020	2030	2040	2050
consumption
Oil	10.80	8.95	4.21	1.53
in shipping	Gas
0.06	0.39	0.47	0.10
by fuel in	Bioenergy	0.01	0.82	1.71	2.05
Exajoules (EJ)	Hydrogen	0.00	0.22	0.84	1.62
	Ammonia	0.00	0.88	2.93	4.55
	Electricity	0.00	0.00	0.00	0.01
	Synthetic fuel	0.00	0.00	0.01	0.05
	Total EJ	10.87	11.25	10.18	9.91

BUNKER FUELS:

LNG would provide about 4.3% of maritime bunker fuels by 2030.*

INLAND

NAVIGATION:

share of LNG use for inland navigation increases to 3.7% by 2030.*

*European Commission projections

Consumption of gas for maritime shipping is expected to increase globally15.

7x

8x

1. EC -Smart and Sustainable Mobility Strategy Staff Working Document(December 2020)
2. IEA -Net Zero by 2050 scenario(May 2021)

How to produce LNG, bioLNG, eLNG

	LIQUEFIED		LIQUEFIED	CO2
CO2 SYNTHETIC METHANE		BIO METHANE
		= eLNG		= bioLNG
				CH4		LNG		CH4

H2 02

- +

CH4

Photo-

synthesis

LNG

H2O Powered

Shipping

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Eurogas is a European gas industry association representing 64 companies and associations

engaged in gas wholesale, retail and distribution in Europe.