TrialityTaking the environmental and economic performance of VLCCs a great step forward

The Triality VLCC 4

The green VLCC 6

LNG as fuel 8

A ballast-free design 10

Using the low LNG temperature to capture

cargo vapours that are otherwise lost 12

Using the low LNG tempareture to cool

the scavenging air to main engines 14

Is it possible to go green and be profitable? 16

Contents

A CoNVeNTIoNAL VLCC Is ALreAdy AN eNerGy effICIeNT CArGo CArrIer. ThIs projeCT shows ThAT performANCe CAN be sIGNIfICANTLy ImproVed.“

“

4 TrIALITy VLCC

Triality is an innovative concept VLCC that fulfils three main goals:

1. It is environmentally superior to conventional VLCCs2. It has technically feasible solutions3. It is more economical than conventional VLCCs

The name Triality reflects these three main elements. Triality is defined as three united, “the state of being three”.

Triality is a VLCC that has the same operational range and capacities as other VLCCs. Three most likely trading routes have been selected for our study, all starting in the Gulf. one is to the Us, one is to europe and one is to China:

The Triality concept consists of different elements. each has been com-pared environmentally and economically with a base case which represents a conventional VLCC. The first step was the introduction of LNG as fuel in a conventional VLCC. The main engine is a high pressure dual fuel ( gas or oil fuel) two-stroke engine, while the generator engines are low pressure dual fuel engines and the boilers are also multi fuel versions.

The next step was to introduce a ballast-free more V-shaped hull design in addition to the LNG propulsion. The limited draft leads to some changes to the machinery configuration, and a two-propeller arrangement has been chosen. finally a VoC re-condensation system and the cooling of the main engine scavenging air were added. each step makes the concept better from both an economic and environmental point of view.

The Triality VLCC

main dimensions: Lpp= 351m, Loa= 361m, b=70m, T (design, mean)= 21.6m, T (unloaded, mean) = 7.1m. speed= 15 knots/ 16.5 knots, 300 000 dwT. block coefficient loaded: 0.6 and unloaded: 0.52.

6 TrIALITy VLCC

each step in the evolution from a conventional VLCC to Triality has an impact on energy consumption and/or emissions to air and discharges to sea. The energy demand is reduced for most of the steps, giving a total 25% reduction in yearly energy consumption.

The Nox reduction given above is gained without adding any treatment system. by adding a simple exhaust Gas recirculation system for the main engines a further reduction of at least 82% can be gained, fulfilling Tier III emission requirements for ships built after 2016.

Co2 emissions from Triality compared with other transport alternatives, based on Imo figures published in 2008:Triality 3 g/tonkm heavy truck with trailer 50 g/tonkm Air freight 540 g/tonkm Cargo vessel >8 000 dwt 15 g/tonkm

The green VLCC

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Conventional + LNG V-Shape + LNG V-Shape + LNG + VOC Triality

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Triality has the same cargo capacity and operational range as a conventional VLCC, but emits 34% less Co2

8 TrIALITy VLCC

LNG as fuel is a proven concept for short sea shipping. Now this alternative is being developed for full-scale deep-sea shipping.

LNG is used for propulsion, power and steam production (instead of hfo). Triality will have twin high pressure dual fuel two-stroke main engines using marine Gas oil (mGo) as pilot fuel, low pressure dual fuel genera-tor engines using mGo as pilot fuel and a triple fuel boiler that can burn natural gas, mGo and Volatile organic Compounds (VoCs = hydrocarbon vapours recovered from the cargo tank atmosphere). Two pressure tanks (Imo type C), each of 6 750 m3 volume, will be located in deck houses in front of the superstructure on the main deck. The LNG tanks are kept at a pressure of 5-6 bar by the use of pressure build up heat exchangers. This is sufficient to supply LNG to the high pressure pumps for the two-stroke main engines without using submerged pumps. pumping LNG to a high pressure is much more efficient than using compressors to create an equally high pressure.

The LNG fuel tank pressure is sufficient to supply LNG through the low pressure vaporizers and to the auxiliary engines and boilers without the use of pumps. A submerged pump is, however, included in each tank. This can be used to pump LNG out of the tank should the tank pressure be too low.

LNG export terminals are located relatively close to important crude oil terminals in the Gulf area. making LNG available as fuel should therefore be a realistic possibility.

The LNG volume stored on board Triality is sufficient for a range of 25 000 nautical miles, so that bunkering in the Gulf can provide enough fuel for even the longest round trips. This is standard practice for conventional VLCCs today. LNG terminals are also close to crude oil import terminals visited on our chosen routes, so in the future bunkering may be possible at many locations.

LNG as fuel

Natural gas is used as fuel for Triality’s slow speed main engines, auxiliary engines and auxiliary steam boilers. The 13 500 m3 LNG fuel tank capacity gives the vessel a range of 25 000 nautical miles.

10 TrIALITy VLCC

A conventional VLCC carries sea water as ballast in transit in unloaded condition and during loading and discharging in port.

ballast water is used by all VLCCs today for two purposes:• to achieve sufficient draft and suitable trim• to control hull stress levels

The ballast operations have two main unwanted effects: • ballast water may contain organisms that can cause damage when re-

leased into foreign ecosystems. This is why the Imo has established the International Convention for the Control and management of ships’ ballast water and sediments. expensive ballast treatment systems will also increase fuel consumption.

• Additional fuel is needed to transport 80–100 000 tons of ballast water.

Triality has a ballast-free design with the following characteristics:i. New transverse cargo tank divisions enable cargo tanks to be loaded without the need for ballast for strength or trim/heel compensationii. The new V-shaped hull form provides sufficient draft without cargo or ballastiii. The new hull shape has a mean average of 16% less wet surface on a roundtrip, a lower block coefficient and is 11% more energy efficient

A ballast-free design

The new hull shape is designed for sufficient draft, even in an empty condition. New cargo tank divisions eliminate the need for ballast, including during cargo operations.

12 TrIALITy VLCC

The global fleet of crude oil tankers is estimated to emit five million tons of cargo vapours an-nually during transit.

The low temperature associated with LNG vaporization is used to capture cargo vapours (Volatile organic Compounds – VoCs) normally released to the air during voyage. It is estimated that up to 500-600 tons of cargo vapours can be captured during each cargo roundtrip.

The recovered cargo vapours are stored in deck tanks and intended for use as fuel for auxiliary boilers supplying steam to operate cargo pumps. significant financial losses are avoided and environmental benefits are gained.

Using the low LNG temperature to capture cargo vapours that are otherwise lost

Triality uses the low LNG temperature to capture cargo vapours otherwise lost to the atmosphere. This reduces the annual fuel consumption by eight per cent.

14 TrIALITy VLCC

The cooling energy from the LNG glycol circuit may be used for different cooling purposes in a ship.

The low temperature from the LNG vaporization and pressure build up process can be used for various purposes. The glycol circuit is at the heart of this process.

Triality uses cooling energy primarily for VoC re-condensation but also to cool scavenging air for the main engines. This will increase efficiency by up to three per cent. The remaining cooling effect can be used for the fresh water cooling of the engines. The glycol circuit must be kept at a temperature above minus 40°C to avoid freezing. sea water heat exchangers have also been included to provide additional heating when needed. The low LNG temperature may also be used for other purposes like air conditioning, freezers, fridges and so on.

Using the low LNG temperature to cool scavenging air to main engines

don’t underestimate the value of cooling. The scavenging air cooling may provide an energy efficiency gain of up to three per cent.

16 TrIALITy VLCC

The financial performance of Triality is evaluated with respect to investment and voyage cost, compared to a conventional VLCC run on hfo with a ballast water treatment (bwT) system and an exhaust gas scrubber.

The shipping industry is facing an ever increasing demand to reduce its environmental footprint. for ships built before 2016, the present chal-lenge is to comply with ballast water and emission requirements.

we have estimated that Triality has a significantly smaller environmental footprint than a conventional VLCC run on hfo with a ballast water treat-ment system (bwTs) and an exhaust gas scrubber (conventional VLCC). The question then is: is it possible to go green and be profitable? The short answer is yes – Triality is more profitable than a conventional VLCC.

The financial analysis (investment cost versus voyage costs for different fuel price scenarios ) shows that Triality: • improves the expected present value before tax by mUsd 24 in the

reference fuel price scenario (This corresponds to around 20% of the investment cost for a conventional VLCC)

• is profitable until the LNG price reaches Usd 15 per mmbtu in the reference oil price scenario

• is more profitable than a conventional VLCC except in the low oil price scenario

These points are substantiated on the following pages.

Is it possible to go greenand be profitable?

even with different investment scenarios there are good margins in favour of Triality.

Expected present value before tax compared to a conventional VLCC run on HFO (MUSD)

Steel -1.3

-30.0 -20.0 -10.0 0.0 10.0 20.0 30.0

-15.7LNG Tanks & Systems

-3.9Engines & Boilers

-3.0VOC Systems & Tanks

-0.1Cool Air

+0.4Coating

+4.4Scrubber

+4.8Ballast System

+38.2Recuced Voyage Costs

+24.2TRIALITY

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figure 1: Triality cost structure compared to a conventional VLCC.

Triality improves expected present value before tax by MUSD 24 in the reference fuel price scenarioover 20 years Triality improves expected present value by mUsd 24 com-pared to the conventional VLCC in the reference fuel price scenario. The chart below shows how the Triality cost structure differs from a conven-tional VLCC. In short, Triality increases the initial investment by mUsd 14 and reduces the voyage costs by mUsd 38.

18 TrIALITy VLCC

Triality is profitable until the LNG price reaches USD 15 per MMbtu in the reference fuel price scenario Triality is profitable with an LNG price up to Usd 15 per mmbtu given the reference oil price scenario. Given high and low oil price scenarios the expected breakeven price is Usd 26 and Usd 6 per mmbtu respectively. The chart below shows the difference in present value before tax (∆pV b.t.) between Triality and the conventional VLCC as a function of LNG and oil price.

figure 2: LNG breakeven price for different price scenarios Start price of LNG long-term bunker contract (USD/MMbtu)

5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

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Oil price (USD/MMbtu) LNG price (USD/MMbtu)

2010-35 2010-35 -100.0 -50.0 0.0 50.0 100.0 150.0 0.0 -5.0 10.0 15.0 >20.0

PV b.t. from conp. to the conv. VLCC (MUSD) Payback time (yrs)

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figure 3: Triality financial performance for different fuel price scenarios.

Triality is more profitable than the conventional VLCC except in the low oil price scenarioso far we have mainly discussed the financial performance given the ref-erence fuel price scenario. There are major uncertainties connected with fuel price developments. The figure below gives a more detailed view of fuel price scenarios, present values and the payback time on marginal investment (mUsd 14). Triality is more profitable than the conventional VLCC in the reference (r) and high (h) oil price scenarios irrespective of the LNG price scenario. The present value before tax is mUsd 9–129. The payback time on marginal investment is 6–16 years.

Det Norske Veritas ASNO-1322 Hovik, Norway

Tel: +47 67 57 99 00Fax: +47 67 57 99 11 www.dnv.com

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