Study finds lack of marine LNG infrastructure, regulations

  • Wednesday, September 24, 2014 10:54pm
  • News

A U.S. Maritime Administration study released this month found that the country is ill prepared for large vessels converting from traditional heavy diesel fuel to liquefied natural gas.

Improvements in training and regulatory oversight must be made if there is a sea change to LNG as the maritime industry tries to meet new environmental requirements.

The four-part, 156-page report states that there are gaps in standardized regulations for bunkering, or fueling, LNG-powered vessels as well as for emergency preparedness and response requirements, vapor gas management, and inspection requirements. Domestic standards for technical design are also lacking, according to the report.

“Among the list of gaps, one of the most important to ensure the widespread adoption of LNG-fueled ships is clear and risk-informed requirements for non-self-propelled bunker barges,” the authors wrote.

The report concluded that ship-to-ship refueling is the preferred option for the quantities of LNG needed to supply large vessels.

Regulatory vacuums largely exist regarding the transfer of LNG from shoreside facilities or non-navigable waters to navigable U.S. waterways and performing LNG fueling operations while on a navigable waterway, too.

The regulatory improvements would help shape the arrangement of the fueling infrastructure in the U.S., of which there is little, the study suggests. Northern Europe is one region of the world where LNG is a common large vessel fuel.

During a speech at a recent industry conference, Federal Maritime Commissioner William Doyle said the cost and environmental benefits of LNG as fuel cannot be ignored, particularly because the country is flush with natural gas as a result of the shale energy boom.

“Based on the current forecasts, natural gas delivered for production of LNG in the U.S. is now more than 50 percent less expensive on an energy-equivalent basis than marine residual fuel and marine distillate fuel,” Doyle said. “It is projected that this relative price advantage will continue, and even increase, through 2035. This has opened up an opportunity for significant annual fuel cost savings when converting marine vessels that use petroleum fuel to natural gas operation.”

The findings come as large vessel operators attempt to comply with tougher near-shore emissions regulations from the Environmental Protection Agency known as the Emission Control Area, or ECA.

Enacted by the U.S. and Canada in 2012 within the structure of the International Maritime Organization pollution prevention treaty known as Marpol, the ECA currently requires ships operating within 200 miles of the U.S. and Canadian coasts to burn fuels containing less than 1 percent sulfur. On Jan. 1, 2015, the requirement tightens to allow only more expensive fuels with less than 0.1 percent sulfur content.

Cruise companies and marine transporters alike have said the fuel restrictions will significantly increase their operating costs, burdens they will have to pass on to their customers.

Some vessel operators have agreed to add sulfur “scrubbers” to their ships as a way to filter emissions and continue burning standard fuels.

Totem Ocean Trailer Express Inc., or TOTE, one of two companies that offer regular freight service to the Port of Anchorage, is switching the M/V Midnight Sun and North Star to run on LNG. The 840-foot Orca Class freight ships each make one round trip per week between Anchorage and Tacoma, Wash.

TOTE originally planned on converting the vessels’ engines to LNG but has ultimately decided to replace them, according to company spokeswoman Tyler Edgar.

The Midnight Sun’s engine swap will be done by March 2016, with the North Star following about a year later, Edgar wrote. An agreement with the EPA extended TOTE’s fuel switch deadline to September 2016 because it is making such a drastic, long-term change.

Improving the marine LNG infrastructure and developing crew and first responder training are also needed to promote use of the cleaner-burning fuel, according to the report. The infrastructure portion deals mainly with the ways a vessel can be fueled with LNG — truck-to-ship, shore-to-ship and ship-to-ship.

Maritime Commissioner Doyle said shore-to-ship and truck-to-ship are the primary means of refueling in Norway, one of the countries further along in a transition to LNG-powered vessels than the U.S.

Truck-to-ship fueling is an acceptable option for small vessels — a standard LNG tanker trailer can hold between 10,000 and 13,000 gallons of fuel — and as an interim or start-up solution to test the market before more investments are made, but is not a feasible large-scale option, the report states.

While an average tug needing about 25,000 gallons of fuel would mean 2 trucks, a large container vessel capable of carrying 2 million gallons of fuel would require more than LNG trucks to fill it, the report concludes.

It notes that trucked LNG is potentially a more dangerous option, as it would add tanker trucks to congested roads in port cities. Additionally, LNG truck drivers might not be dedicated to the refueling process full-time and thus may not be fully aware of risks and regulations associated with the operation.

Permanent shoreside facilities have opposite qualities.

“Although the (shore-to-ship) option has great flexibility in the design for transfer rate and volume, it is the least flexible with respect to geography,” the study authors wrote. “It must be sited at a fixed location, relatively close to the dock or jetty. Heat loss from long sections of pipeline and costs of cryogenic-service pipelines necessitate this proximity constraint.”

If a ship is required to moor at a dedicated dock to refuel without cargo transfer taking place, the time benefits of ship-to-shore fueling would likely evaporate, it states.

TOTE’s Edgar wrote that the company is working on a “phased approach” with its LNG vendors. Eventually, TOTE expects to fuel from shore tanks, but an interim solution has not been determined while that infrastructure is developed in Northern Washington, she wrote.

Depending on sea conditions, the Midnight Sun and North Star are projected to use about 400,000 gallons of LNG per round trip.

The study also pushes for the adoption of best practices and acceptable risk guidelines for fueling. Establishing safety zones during LNG transfer and effective training regimens for truck drivers will be critical to minimizing risks associated with the highly-flammable fuel, according to the study.

An attempt to quantify the risk of actual fueling operations found the truck-to-ship method to be the safest once the LNG is on-site. If a one-in-10,000 chance of fatality for someone continuously involved in LNG fueling is deemed acceptable, a safety zone for truck-to-ship would be 46 meters for other individuals. With shore-to-ship that zone increases to 57 meters, and to 70 meters with ship-to-ship operations.

The truck-to-ship method is considered the safest while fueling because it involves the smallest amount of fuel. For the other methods, tank rupture is not considered a realistic concern in shore-to-ship. Taking advantage of the mobility of the operations and conducting them away from port facilities could increase ship-to-ship bystander safety.

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