Conduct a feasibility study on LNG infrastructure for short sea shipping

Short Sea Shipping needs to be developed as a sustainable transport alternative encompassing intermodal transport as well as transport of bulk cargo. With the coming cuts in the allowed sulphur content in bunker fuel and limitations on emissions of nitrogen oxides, the competitiveness of short sea shipping is put under great stress and new technologies must be considered. Engine manufacturers have started to offer liquefied natural gas (LNG) as an alternative to oil, but this alternative demands an infrastructure of LNG filling stations. Liquefied natural gas (LNG) is a climate- and environmentally friendly fuel that is to be made competitive through an effective infrastructure and good framework conditions. This has been the aim of a major project in which, inter alia, the Scandinavian countries and several large energy companies participate. The Danish Maritime Authority was the coordinating partner of the project. The purpose of the project was to develop recommendations for how to establish an infrastructure facilitating the use of LNG as a ships’ fuel. However, other important areas have also been identified. The project’s recommendations concentrate on five main areas: Bunkering of ships with LNG, Economic and financial conditions, Safety, Technical and operational conditions and finally Permits for an infrastructure ashore.

The final report’s recommendations concentrate on five main areas: • Bunkering of ships with LNG • Economic and financial conditions • Safety • Technical and operational conditions • Permits for an infrastructure ashore New regulations making natural gas competitive The background for the project is the fact that, as of 2015, only fuel oil with a maximum sulphur content of 0.1 per cent will be permitted in the English Channel, the North Sea and the Baltic. This limitation creates a possibility of making it economically profitable to use LNG that is, at the same time, more environmentally and climate-friendly. The analyses carried out under the project shows that LNG is a competitive alternative to the use of low sulphur fuels. However, this requires an effective infrastructure where LNG is distributed through a net of ships and lorries to local terminals or directly to ships using LNG as fuel. Such an infrastructure is connected with the need for major investments, which is on the other hand characterized by a poor utilization of the capacity in the beginning due to limited demand. A Summary of the final report is available at: http://www.dma.dk/themes/LNGinfrastructureproject/Documents/Final%20Report/LNG_Summary_Report_20120522_optimerad.pdf