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UASC exploring cooperation on LNG bunkering

UASC exploring cooperation on LNG bunkering
United Arab Shipping Company (UASC) is open to cooperating with other stakeholders in the LNG supply chain, but is not in the process of building a Middle East refuelling stop, Jørn Hinge, president and ceo, told Seatrade Global.

Following reports earlier this year that UASC was planning to build a bunkering station in the Middle East to refuel its vessels around the midpoint of the Asia-Europe trade, Hinge clarified the line’s plans.

“Let us be clear on this point: UASC is not directly making arrangements for LNG bunkering facilities in the Middle East or elsewhere.

“Rather, UASC is open to working closely with concerned parties including LNG producers/suppliers, Port Authorities, regulatory bodies, other government authorities, etc. in order to ensure the exchange of information to support the availability of LNG bunkering facilities at such a time that UASC and other customers would require. UASC is confident that the LNG supply and requisite infrastructure will be there to meet the demand for LNG as a marine fuel in due course.

“UASC maintains ongoing dialogue with key industry players and will continue to explore areas of cooperation related to LNG fuel and in general going forward.”

The availability of LNG as a fuel is of particular interest to UASC as it prepares to take delivery of a fleet of LNG-ready box ships from Hyundai Heavy Industries (HHI), starting next month. The ships, which will initially run on standard HFO, have been designed to make the retrofit of LNG dual fuel technology possible and will be deployed on the Asia – Northern Europe, Asia – Mediterranean, and Asia – Arabian Gulf trades.

Hinge expects that LNG will power the ships at some point in their lifetime, but multiple factors influence the timing of that decision. The capital investment required for the retrofits dictates that there must be a business case for the work to allow dual fuel, including the price balance between HFO, LNG, distillates and low sulphur HFO.

UASC Jørn Hinge “A precondition for the business case for LNG is a high level of confidence in the security of the supply of LNG at existing/traditional ports of call for liner shipping container vessels in the Asia – Europe/Mediterranean routings,” he added.

Two weeks ago the Port of Sohar in Oman announced plans to start offering LNG bunkering in the near future and said that it wanted to be ready for the UASC ships. Other ports in Europe and Asia also have LNG bunkering plans in the works.

The physical work of the retrofit remains a significant undertaking on the UASC ships, even with the steps taken during the design process to enable the modifications.

“UASC is currently concentrating on ensuring the delivery of its newbuildings on time and with the highest level of quality that UASC has come to expect from HHI. Until the decision is taken to actually proceed with the conversion to dual fuel, the workload is somewhat unclear.”

“However, the design modifications already implemented to make the vessels LNG ready and especially the approval-in-principle that has already been secured from DNV GL means that the workload at the time of conversion will certainly be less than it would otherwise be. These steps also confirm already that the conversion will be feasible, which is not the case for all container vessels currently in the water.”