Vanguard Magazine

28 FEBRUARY/MARCH 2018 www.vanguardcanada.com 600 times. Even with this, the density is still only 60 per cent that of diesel, but it can now offer a realistic alternative to conventional fuels even for longer-haul ships. CNG is generally considered to be viable only for short routes. Liquefaction has been used for many years for two main purposes: to allow for trans-ocean transportation and to provide local on-shore storage reserves. Both ap- plications have almost unblemished safety records. NG poses a range of hazards, but arguably no more than alternative fuels such as propane or even gasoline. The IMO has for some time had a Code to en- sure the safety of LNG carriers (tankers) and more recently developed a new Code for use on ships using NG as a fuel, which is now included in the marine regulations of Canada, the U.S. and other countries. The Code has also been supplemented by a range of industry rules and standards, providing a clear basis for new ship de- signs. An NG-fueled ship has considerable dif- ferences from a conventional ship. Oil fuel tanks can be positioned almost anywhere and can form part of the overall ship struc- ture. CNG and most LNG tanks are pres- sure vessels, which must be mounted in or on the ship, and can pose arrangement challenges. LNG can also be carried in membrane tanks, which are complex and highly insulated boxes built into the hull. They require additional pressure manage- ment systems to handle boil-off of the very low-temperature fuel. Much of any LNG fuel system has to be fabricated from cryo- genic materials, and ventilation and vent- ing arrangements are needed to mitigate fire and explosion risks. NG-fueled engines come in several main types, with multiple variants of each. The majority of installations to date are dual- fuel, in which a small amount of diesel (often around 1 per cent) is used as a pilot fuel to ignite the NG. If there is an inter- ruption in the NG supply, these engines can also operate on 100 per cent diesel. Dual-fuel engines operate either on a die- sel combustion cycle or on an Otto cycle – different manufacturers are strong pro- ponents of one or the other, which have different efficiencies and emissions. There are also pure gas engines, which have to be spark-ignited. In all cases, the engines marine fuels Figure 3: M.V. Seaspan Swift "The biggest impediment to the adoption of LNG has been the lack of infrastructure." are currently significantly more expensive than conventional marine diesels, partly because they are carrying high develop- ment costs over small production runs. This disadvantage may reduce as NG use becomes more widespread, but in overall terms, an NG fuel system will always be substantially more expensive than a liquid fuel system. The extra installation costs have to be offset by lower operating costs, particularly the cost of the fuel. The biggest impediment to the adop- tion of LNG has been the lack of infra- structure; often referred to as the chicken- and-egg challenge – owners will not order expensive LNG ships until the fueling in- frastructure is available, and potential sup- pliers will not build expensive infrastruc- ture until they are sure of clients. Proactive policies by a number of ma- jor ports, governments and suppliers have now started to fill this gap, with the re- sult that 11 per cent of all ships ordered worldwide in 2017 will be LNG-ready, and the proportion is expected to grow in 2018 and beyond, as the key 2020 date approaches. In and around ports such as Singapore, Rotterdam and other major, hubs LNG is now available from shore tanks, bunkering ships and barges, and tanker trucks. The (potential) Canadian advantage Natural gas is currently cheaper than other fossil fuels in most parts of the world. It is particularly cheap in North America, and even more so in Canada. The shale gas (or fracking) revolution has led to an excess of supply over demand in North America, while huge new conventional reserves are coming on line in places such as the Mid- dle East, Russia and Australasia. Forecast- ing fuel prices is notoriously difficult, but no mainstream forecasts suggest that the differential between NG and crude will drop in the next several decades – which is more than enough for most investment decisions. Liquefaction adds cost, but LNG in Canada is much cheaper than die- sel and very competitive with heavy fuels. Canadian ports are either an actual or a potential end point for many major in- ternational shipping routes. Ports such as Vancouver and Halifax lie near the Great Circle (shortest) routes between North America and Asia/Europe respectively. If cheap fuel is available in these ports, op-

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