LNG bunkering market to expand

The market stood at 70k tonnes in 2013 and is expected to reach 22,540k tonnes by 2025. This represents an annual growth rate of 63.6%.

It is anticipated that from 2015 onwards the limit on the sulphur content of fuels used in Emission Control Areas (ECAs) will be brought down. Furthermore the International Maritime Organisation is imposing more stringent regulations from 2020 onwards.

These changes are encouraging vessel operators and shipping companies to explore fuel alternatives such as LNG to ensure they comply with emission norms.

At present only 45 vessels in the world use LNG as a bunker fuels and most of these bunkers are mainly operational in the inland waterways of northern Europe.

It is expected that tankers and container vessels will soon be adopting LNG as a bunker fuel. Europe leads the way with most shipping companies in the region gradually shifting to LNG. North America, too, has begun developing various LNG bunkering terminals.

However, market growth in this area may be hampered by insufficient fuelling infrastructure in prime bunkering destinations. The steep investment costs needed to expand this area are also a concern.

LNG is the most popular bunkering fuel in ECAs owing to its affordability over other ECA-compliant fuels.

Key companies in the LNG bunkering market include Harvey Gulf International Marine LLC, Korea Gas Corporation, Gasnor AS, Skangass AS, GDF SUEZ SA and Royal Dutch Shell plc.