LNG

The LNG Marine Fuel Institute formed in Australia to help improve access to bunkering has praised the first move by the Pilbara Port Authority in Western Australia to issue a ship-to-ship LNG bunkering licences to plant operator Woodside.

LNG MFI Chief Executive Margot Matthews said Pilbara Port and Woodside had executed non-exclusive licences to provide ship-to-ship LNG bunkering services at the ports of Port Hedland and Dampier, the first licences of their type issued in Australia.

“Since 2017 LNG MFI has worked to bring together key players to develop a cleaner marine fuel industry in Australia as we lower emissions for a better future and it’s exciting to see this now moving full steam ahead,” Matthews explained.

LNG MFI is an independent not for profit organisation established to enable LNG, the cleanest alternative available, to be a primary fuel for marine transportation.

The body is also supporting the plans by commodities giant BHP to use LNG as fuel for future iron ore carriers on the Australia-Asia trade route.

LNG MFI’s position is that Australia can meet and exceed the new International Maritime Organization 2020 regulations by establishing early adoption of LNG as a transition marine fuel and providing the Australasian maritime industry with a superior and cost effective fuel source

Pilbara Ports Authority’s General Manager Development & Trade, Lyle Banks, said the Authority has issued three licences for LNG bunkering operations in the Pilbara.

“In addition to Woodside’s ship-to-ship licences, a truck-to-ship LNG bunkering licence was issued to Evol LNG in early 2017,” added Banks.

“Western Australia is well-placed to become an LNG bunkering hub, with LNG production facilities close to large iron ore mining operations and the many hundreds of ocean-going vessels that use ports in the Pilbara region,” stated banks.

Woodside Executive Vice President Marketing for Trading and Shipping, Reinhardt Matisons, described working with Pilbara Ports Authority to finalise LNG bunkering licences “as a key step in developing an LNG fuels industry” in Western Australia.

“Woodside is finalising plans for an LNG bunkering operation in the Pilbara to capture the significant environmental and economic benefits of using LNG, instead of fuel oil, for the busy iron ore shipping trade,” added Matisons.

“We continue to work with potential customers on this opportunity,” he said.

LNG MFI’s CEO Matthews expects Australia to play a leading regional role in LNG fuel.

“While there’s no single pathway to a low emissions future, expanding the use of LNG as a transition marine fuel is one way to help reduce greenhouse gases from shipping and help reduce this country’s environmental footprint,” said Matthews. 

BHP, the Australian commodities and energy company whose assets include a stake in the North West shelf liquefied natural gas export plant in Western Australia, has issued the world’s first bulk carrier tender for LNG-fueled transport for up to 27 million tonnes of its iron ore.

“Through this tender, we are seeking potential partners who share our ambition of lowering emissions to the maritime supply chain,” said BHP.

The company said the tender was open to a select group of industry leaders, from ship owners, banks and LNG fuel network providers.

The apparent aim of the tender is to find a partner for an LNG-powered newbuild iron-ore carrier, or a shipping company willing to order one with a pre-booked charter from BHP.

BHP said that introducing LNG-fueled ships into its iron ore maritime supply chain would eliminate nitrogen oxide and sulphur oxide emissions and significantly reduce carbon-dioxide emissions along the busiest bulk transport route globally from Western Australia to North Asia.

As well as LNG-fueled transport for up to 10 percent of its iron ore, the tender seeks other innovative solutions that can lower greenhouse gas emissions and increase productivity from BHP’s freight requirements.

“We are fully supportive of the International Maritime Organisation’s (IMO) decision to impose lower limits on sulphur levels in marine fuels,” said Rashpal Bhatti, Vice President, Maritime and Supply Chain.

“While LNG may not be the sustainable homogenous fuel of choice for a zero carbon future, we are not prepared to wait for a 100 percent compliant solution if we know that, together with our partners, we can make significant progress now,” added Bhati.

“This new tender adds to the work BHP is doing with customers, suppliers and parties along our value chain to influence emissions reductions from the transport and use of our products,” stated the BHP executive.

“We recognize we have a stewardship role, working with our customers, suppliers and others to influence emissions reductions across the full life cycle of our products,” he explained.

BHP, whose main offices are in Melbourne, London and Singapore said that as well as making investments in emerging technologies, it sets GHG emissions reduction targets for its operations and works across sectors to strengthen its global policy.