K Line CEO: We Can’t Reach IMO’s 2030 Targets by Simply Switching to LNG Fuel
- Business & Finance
Japanese shipping company K Line believes the future of its business excellence lies in the further development of alternative technologies that go beyond liquified natural gas (LNG).
As such, the company revealed its commitment to the LNG + (plus) strategy as part of its plans to reduce its greenhouse gases (GHG) and meet its Environmental Vision 2050 in line with the mounting pressure to cut the global CO2 emissions.
K Line already announced the construction of an LNG-powered car carrier at the end of last year and its participation in an LNG fuel supply business in Singapore with Shell in addition to the launch of a joint venture in the Chubu Region.
“However, we cannot reach IMO’s 2030 targets by simply switching diesel oil to LNG fuel; on top of that, we must continue to study new technologies as “LNG + (plus)”, such as the self-flying energy kites announced last year that utilize wind power. Furthermore, in order to reach our 2050 goals, we will accelerate research in alternative fuels such as ammonia, and methanation fuels in addition to hydrogen, participated in demonstration of shipping liquefied hydrogen through HySTRA in last November,” Yukikazu Myochin, President & CEO at K Line said.
Looking back on 2019, Myochin said that the company focused its efforts on recovering the fleet’s cost competitiveness through structural reforms set into motion by former President Murakami at the end of FY2018, improving profitability in the company’s car carrier business, and driving a turnaround of OCEAN NETWORK EXPRESS (ONE).
“As a result of these efforts, as well as efforts to accumulate profits based on our medium and long-term contracts and reduce operating expenses, we were able to achieve more progress in the first half of the year than originally planned,” he said.
Moving forward into the next decade, K Line plans to launch a new medium-term management plan. The details of the plan are set to be announced in April this year.
“There will be no change in our core philosophy of facing customers head-on and providing high-quality services that meet their needs. We will further refine our strengths and increase competitiveness in our four core business operations of dry bulk, energy transportation, car carrier, and logistics/shortsea-coastal services. Having overcome the teething problems of operation, ONE is now at the stage where it can achieve more synergy through best practices and expect further improvements in meeting the bottom line.”
“As we stand at this new starting line, it is critical that we keep our antennas up and remain alert and prepare to respond flexibly to any changes. Market fluctuations are inevitable in the shipping business. From a medium to long-term perspective, we can see that the automotive industry is entering a once-in-a-century period of transformation, and that the energy industry is also moving toward low carbon and decarbonized alternatives. I believe that constantly reviewing conventional methods of doing things to see through to the heart of the matter, enhancing individual strengths, and then acting based on these insights, will lead to certain progress.”