Greek owners on newbuild buying spree for conventional fuelled ships

All but about 10 of these ships are conventionally powered ships, mainly LR2 tankers, mainly to replace the ageing Aframax fleet, and bulk carriers, with only one containership ordered so far in 2023.

Qatar Gas is in the second phase of newbuild ordering, 60 ships in the first phase and a similar number in the second phase of ordering. Across all phase a total of 151 newbuilding slots have been reserved by Qatar Gas, which is collaborating with shipowners in the operating of this new fleet, with more now going to Greek owners, although the actual amount is not yet fixed.

Asked if the small number of ships that can operate on dual-fuel vessels ordered is an indication that Greek owners are refusing to accept the need to decarbonise, the source said that Greek owners were generally very happy to meet carbon regulations but that there was a lot of uncertainty in the market.

“Greek owners are concerned, but they believe that oil will remain as a fuel in the future, but trying to optimise the efficiency of ships, using air lubrication and these types of energy saving devices,” he said.

In addition, owners are discussing the potential of carbon capture and storage CCS systems, which are under development. GasLog are testing a CCS for operation on their LNG ships.

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In general, the idea behind the Greek owner’s strategy is to order the best ships that they can operate now, but rather than pay a premium for dual-fuel ships or alternatives such as wind assisted power, owners are waiting to see how the market develops, by ordering cheaper ships that can be adapted once a clear industry direction emerges.

“Dual-fuel ships can add another 20% or more cost to a newbuilding, those figures don’t add up,” the source said.

It is not expected that oil will be abandoned as a fuel in future so Greek owners could use options such as carbon, capture and storage systems or biofuels to meet CII regulations he explained.

Owners are also now looking at ways in which they can collaborate to mitigate the effects of carbon charges that will be levied from January when the EU Emissions Trading Scheme (ETS) comes into force.

By pooling resources owners could share available carbon units, reducing the impact of the ETS rather than each operator having to buy EU Allowances (EUA) individually.

The rules allow for owners with 10 EUAs each to double up and so if owner A uses 15 carbon units and owner B six units, by combining their EUAs they can reduce their extra outlay to just one unit, whereas if owner A was to pay on their own they would be penalised for five extra units.