Mark Bell

Society for Gas as a Marine Fuel

June 2015

CONTENT CONTENT

1.0 Highlight current issues facing the industry

Price

Availability

2.0 SGMF update

who what where when….

3.0 Current projects

Work Groups, Outputs

3

Technology

Ship Types

Safety

New Build

or Retrofit?

Price

Availability

Public

Perception

Why gas as a marine fuel ?

For who and just what are the issues?

Regulation &

Rules

Performance

Competition

ENVIRONMENT

Price

• Energy markets are changing

• Crude price change rate

• Any differential to gas right now is

low

• Market uncertain what will happen

when crude price rises?

• When it does – what will happen to

gas prices?

• Gas prices vary widely

• Regional price proportional to local

energy

• Base cost < Crude …but

AVAILABILITY

• Everywhere and nowhere

• Many current projects are also providing for themselves

• Not going to happen overnight

• Capital intensive• Other fuel

candidates

LNG supply chain

Bulk LNG Liquefaction

Liquefaction plant Bulk LNG Shipping

Bulk LNG Import Terminal

Gas Production and Delivery

Small, local Liquefaction plant

LNG to

Market

Small scale LNG Liquefaction

Status report: ships

• 54 gas fuelled ships in service

• 59 vessels under construction

• Car ferries currently make up the majority of the LNG fuelled fleet 26 (48%) in operation and 15 (25%) on order.

• Offshore support vessels make up the second largest contingent at 29% and 18% respectively

• Most types of ship now represented by a gas fuelled variant

0

10

20

30

40

50

60

70

Norway Other Europe US/Canada Rest of World

Nu

mb

er

of

ga

s fu

ell

ed

sh

ips

Other (order)

PSV (order)

Ferry (order)

Other Ships

PSV

Ferry

• 70,000 ships - world fleet

• 250 – 2500 in next 5-7 years

• 9000 fold increase in

transactions!

Status report: markets and drivers

• Worldwide gas as fuel market starting to fragment into regional activities

• What does this mean for marine fuel supply?

• Current crude price drop / HFO is masking the apparent cost benefit of LNG

• Jan 2015 and ECA 0.1% has passed, global sulphur cap next…..

SE Asia

ChinaNorth America

Europe

Norway

PRICE SUBSIDY GEOGRAPHY

So What is SGMF?

• The Society for Gas as a Marine Fuel is

• A non-governmental, non-profit making, industry membership based organization

• Objective is to establish and encourage the safe and responsible operation of gas fuelled vessels and their fuelling infrastructure

• SGMF is developing and delivering best practice and guidance on most aspects of the marine gas fuelled industry avoiding duplication and where it matters most

TECHNICAL

SAFETY

ENVIRONMENTAL

CONTRACTUAL

TRAINING & COMPETENCE

• As for regulations……

• Gas as Fuel = SGMF + IGF code

• Gas as Cargo = SIGTTO + IGC code

Who and where are SGMF

• London based Secretariat3 Staff

• Global Board Governance16 Organisations across the business

3 Meets and 1 AGM per year

• Technical Committee17 Individuals from across membershipMeets twice per year

• Work Group Activity Based6 Current, various outputs

• Member Type Focus Groups

Our membership

• 88 members worldwide from a wide

range of industries including

• Port authorities

• Ship owners and managers

• LNG suppliers and facility operators

• Energy majors

• Bunkering providers

• Equipment manufacturers

• Port and National Authorities

• Consultants and Designers

Founding board members

Our vision…..mission…….

Leading the industry, using our collective knowledge

and experience, to help and provide insightful

guidance, for safe and responsible use of gas as a

commercial marine fuel.

INSPIRING RESPONSIBLE FUTURE SHIPPING

Four Key Areas of Activity

• Emission levels• ECAs• Scrubbing• Alternative fuels

• Worldwide infrastructure• Ship fleet projections• Ship fuel systems• Bunkering systems and

procedures

• Handling Cryogenic fluids• Safety distances• Designing in safety• Risk assessment• Simultaneous Operations• Emergency procedures• Training & Competence• Salvage of LNG

• Commercial agreements• Quantity measurement• Sampling & quality

calculation

SAFETY

ENVIRONMENT TECHNICAL

CONTRACTUAL

WHAT?

Output and Publications

1. Mini guide

2. Overview / Training by subject

3. Detailed technical guidance

Mini guide

Subject overviews

Technical guidance

Mini Guide

• SGMF’s first general publication available since Oct 2014

• Guide is downloadable and free from the SGMF website (www.sgmf.info)

Bunkering Safety Guidelines

• SGMF’s first official work group

output March 2015 Bunkering Safety

Guidelines

• Available to members only

Quality & Quantity Issues

• SGMF’s second official

output July 2015

Contractual Guidelines

• Available to members only

How?

Working groups & the Technical

Committee

• Meetings of members to discuss specific issues

• Capturing of industry experience and best practice for distillation into publications for the rest of the industry - authoritative

• All members welcome to join or observe

• Technical committee controlled

• Last TC in Rotterdam April 2015Next TC in Jacksonville Sept 2015

• 6 Current working groups

• Safety Guidelines

• Safe Working Distances

• Salvage of LNG

• Training and Competence

• Quality and Quantity Issues

• Essential Equipment Components

• Under consideration

• SIMOPS

• Emergency Shut Down Systems

• Risk assessment application

• Methane slip

• Environmental performance – well to wake

• Efficiency of 2 and 4 stroke engines

• EEDI ship plots for gas fuelled vessels

Conclusions• Gas was, is and will continue to be a clean marine fuel and has a future

market share

• The question is how fast will it grow and where in which segments

• Many factors affect its selection

meanwhile

• SGMF aims to establish and share best practice worldwide• Working groups lead industry thinking

• Knowledge to become available to the whole industry

• Gas as a Marine Fuel : safe and prosperous for all

• SGMF is only as good as its growing membership and associated fellow NGOsIAPH,SIGTTO,IACS,IBIA,INTERTANKO,GIIGNL

• SGMF looks forward to your assistance and input…so please join in

Mark.Bell@sgmf.info