Keppel grows LNG business with tug orders and partnership with Shell

Keppel Singmarine, wholly-owned by Keppel O&M, secured the tug contracts from Keppel Smit Towage and Maju Maritime who have ordered one unit each.

The two tugs, due for completion in 2018, are expected to use bunkering services provided by FueLNG, a joint venture firm of Keppel-Shell that will provide LNG bunkering services in Singapore.

“We are happy that our joint venture, FueLNG has secured its first two contracts from Shell to provide bunkering services for Keppel Smit and Maju’s dual-fuel tugs. Together, Keppel’s shipbuilding/design capabilities and LNG bunkering services provide end-to-end solutions for vessel owners turning to LNG as a marine fuel in Singapore,” said Chow Yew Yuen, ceo of Keppel O&M.

The Maritime and Port Authority of Singapore (MPA) will co-fund up to SGD2m ($1.5m) for each tug under its LNG Bunkering Pilot Programme Grant, as Singapore port seeks to make LNG bunkering a reality in the future.

To bolster efforts in the LNG-related business, Keppel O&M, through its subsidiary Gas Technology Development, signed a MoU with Shell’s subsidiary Shell Eastern Petroleum to jointly explore potential opportunities to cater to the demand of LNG as fuel in coastal areas, inland waterways and the international marine sectors. Shell Eastern Petroleum is already an accredited bunker supplier in Singapore.

The partnership will leverage Keppel’s strength in shipbuilding and design, and Shell’s experience as a global energy supplier to work with potential customers to develop technical and commercial solutions for their LNG fuel needs.

Michael Chia, managing director (marine & technology) of Keppel O&M, commented: “Through this cooperation framework, Keppel and Shell can combine our resrouces and expertise as a leading global shipbuilder and energy supplier, and work together in collaboration with stakeholders such as shipping companies, terminal operators, local governments and regulators to meet their needs which may include engine retrofit or setting up coastal LNG storage infrastructure.”