SunGas to invest $2 bln in green methanol plant to power Maersk’s ships

SunGas Renewables, a Texas-based spin-out of GTI Energy, is forming a new subsidiary named Beaver Lake Renewable Energy (BLRE), which will construct a new green methanol production facility in Central Louisiana.

Image credit Odfjell Terminals Korea

The facility is expected to produce nearly 400,000 metric tons of green methanol per year for marine fuel, intended to fuel A.P. Moller – Maersk’s fleet of methanol-powered container vessels.

SunGas said that the factory would utilize wood fiber from local, sustainably-managed forests, adding that the methanol would have a negative carbon intensity through sequestration of nearly a million tons per year of carbon dioxide produced by the project, which will be executed by Denbury Carbon Solutions.

BLRE is expected to invest approximately $2 billion to construct the project at the former International Paper facility in Rapides Parish. The construction of the facility is set to begin in late 2024 with commercial operations commencing in 2027.

SunGas said that it chose Central Louisiana for the BLRE project due to its long history of sustainably managed forests, available infrastructure to support the facility, and strong local and state support.

“A.P. Moller – Maersk is excited to be partnering with SunGas Renewables, which is pioneering a truly large-scale pathway to green methanol with its Beaver Lake Renewable Energy facility. We would like to thank SunGas Renewables for showing great leadership and for its commitment to the green transition of energy,” Emma Mazhari, Head of Energy Markets at Maersk, said.

“This is helping Maersk to deliver valuable services to our customers and is aligned with our aim to reach net zero greenhouse emissions by 2040. Together, as pioneers in the field, SunGas and Maersk are driving a much-needed transition in a heavy pollution industry. We hope that work can be accelerated further in the years to come.”

“Using biomass from sustainably managed forestry along with carbon capture allows our project to generate green marine shipping fuel while simultaneously removing carbon from the atmosphere. This new low-carbon marine fuel facility also helps strengthen communities and create sustainable economies right here in Rapides Parish, Louisiana,” said Robert Rigdon, CEO of SunGas Renewables.

“As we continue our mission to make a meaningful impact in the energy transition, we look forward to collaborating with all our project partners and the State of Louisiana to construct and operate this important project. This incredible effort happening right here in Pineville will be an innovative and industry leading low-carbon energy solution that will help fuel a better world.”

In late 2022, SunGas Renewables announced a strategic green methanol partnership with Denmark-based Maersk, the world’s second-largest container shipping company, to produce green methanol from multiple facilities around the country.

The BLRE project is SunGas Renewable’s first facility to produce green methanol for Maersk.

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Meanwhile, Maersk is about to welcome to Copenhagen its first green-methanol-powered vessel, the 2,100 TEU feeder Maersk Solstice. The feeder has just been delivered from Hyundai Mipo and after bunkering its first fuel in Ulsan, Korea embarked on a maiden journey heading for Denmark, where it will be christened in September.

The feeder has secured fuel for its maiden voyage from Dutch producer and distributor of hydrogen-based products OCI Global.

The bio-methanol that will be used for the maiden voyage of Maersk’s feeder vessel will be produced from biogas obtained from landfills in the United States

The vessel will now sail through some of the world’s busiest shipping routes, bunkering in Singapore, Egypt, and Rotterdam en route.

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The 21,500 km trip from Ulsan, South Korea to Copenhagen, Denmark will provide real operational experience for Maersk seafarers handling the new engines and using methanol as fuel, as the company prepares to receive a fleet of new, large ocean-going methanol-enabled ships from 2024.

Just a month ago, Maersk placed an order for six mid-sized container vessels with Yangzijiang Shipbuilding Group. The six 9,000 TEU vessels will all have dual-fuel engines able to operate on green methanol and fuel oil. The ships are slated for delivery in 2026 and 2027.

The latest order brings Maersk’s fleet to 25 methanol-enabled vessels on order.