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SEALNG: study boosts LNG as marine fuel investment case

LNG bunkering coalition SEALNG unveiled its study highlighting “a strong investment case” for LNG as a marine fuel in the container shipping market.

The study was commissioned from the independent simulation and analytics company Opsiana in order to provide shipowners and operators in analyzing investment opportunities, according to a SEALNG statement.

Peter Keller, SEALNG chairman, stated, “the study unequivocally shows that for this vessel type, on this trade route, LNG as a marine fuel delivers the best return on investment on a net present value (NPV) basis over a conservative 10-year horizon, with fast payback periods ranging from one to two years.”

The results of the study, which analyses the case of a newbuild 14,000 TEU container vessel operating on an Asia-US West Coast (USWC) liner routing and compares six fuel pricing scenarios, challenge commonly held assumptions in relation to the economic performance of LNG bunkers.

The results are even more compelling given the investment scenarios are compiled and compared based upon on a route with very little voyage time (8 percent) in Emission Control Areas (ECAs), the statement said.

“LNG is also proven to be the best investment across a broad spectrum of business climates from strong freight markets with elevated vessel operating speeds to weak freight markets where slow steaming is employed,” SEALNG’s statement reads.

The study further indicates that LNG provides a greater ROI than alternative compliance solutions, including the installation of Exhaust Gas Cleaning Systems (EGCS), or scrubbers, across 5 out of 6 of the fuel scenarios explored, the statement said.

It also reveals a diminishing CAPEX hurdle, competitive energy costs, the stability of LNG pricing, and the realistic cost of scrubbers.

While this study focuses specifically on the investment case for LNG within a key liner trade route, the coalition is collaborating with third parties on further independent research which will analyze the investment case for different vessel types and additional liner trade routes, the statement reads.

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