WesPac, CME partner up on LNG supply to ship owners
WesPac Midstream signed a partnership agreement with Clean Marine Energy to ensure the supply and delivery of LNG to ship owners utilizing CME’s Emissions Compliance Service Agreement (ECSA) to convert to cleaner fueling.
The WesPac/CME integrated solution represents a significant step in the evolution of LNG as a marine fuel. The partnership is able to provide both the funding required for LNG conversion as well as the infrastructure for LNG supply and delivery. Conversion to LNG while financing the up-front investment provides the economic benefit of LNG fueling to ship owners without capital deployment, and ensures compliance with ECA regulations taking effect on January 1, 2015.
Pace Ralli, CEO and Co-Founder of CME, explained, “The first question every ship owner asks is ‘Where will I get the LNG?’ because if they cannot ensure the future delivery of LNG then they will not see the investment payback. CME’s partnership with WesPac provides the answer to this question and greatly simplifies the decision to convert to clean, lower-cost LNG fuel.”
Ship owners have a window of opportunity to act as early movers and lead the U.S. domestic shipping industry into the next era of low-emissions shipping. As partners in the emerging LNG fueling market, WesPac and CME aim to help reduce the barriers to LNG adoption and assist the early movers in the marine industry and other high horsepower industries such as rail, mining and E&P.
Funds managed by Oaktree Capital Management are supporting both WesPac’s LNG infrastructure projects and CME’s ship upgrade projects.
Press Release, October 7, 2014; Image: WesPac Midstream