India Poised to Double Down on Natural Gas Amid Rapid Growth

By Tsvetana Paraskova - Nov 21, 2024

India's natural gas demand is expected to double by 2040 and triple by 2050.

Despite rising domestic production, India will increasingly rely on liquefied natural gas imports, especially from Qatar and the Middle East.

Natural gas will play a key role in India's energy transition, supporting industrial processes and reducing reliance on coal.


India’s energy demand growth is not limited to oil. The world’s third-largest crude oil importer is set to become a major force in the natural gas market as its demand is expected to surge in the coming decades amid industry and population expansion.

The share of natural gas in India’s primary energy supply is currently between 6% and 8%, according to data from various government statistics and international forecasters such as the International Energy Agency (IEA) and the Statistical Review of World Energy published annually by the Energy Institute.

Small Share of Natural Gas in Power Generation

Unlike in other major economies, India’s share of gas used for power generation is smaller as the country continues to bet big on coal-fired electricity and expands renewables capacity. India has a goal to reach net-zero, but two decades later than most countries, in 2070.

Renewable capacity installations are booming, with the 200 gigawatt (GW) milestone reached in October, data from India’s Central Electricity Authority showed earlier this month. Renewable electricity generation capacity now stands at 203.18 GW, up by 13.5% compared to October 2023. Renewable energy now accounts for 46.3% of total installed capacity of 453 GW.

Related: World’s Largest Climate Fund Sees Few Investment Opportunities

India targets to have a total of 500 GW power capacity from non-fossil sources by 2030.

While the country continues to boost renewable capacity installations for power generation, it will increasingly rely on natural gas for industrial production and processes, especially in fertilizers, oil refining, and petrochemicals.

Industry to Drive Gas Demand Surge

As India sees fertilizers as a critical industry for its agricultural sector, and as steelmaking and construction are booming to meet the growing economy and population, natural gas demand will continue to rise. India’s domestic production, although it has increased over the past two decades, will not be enough to meet growth in demand. So the country will have to rely on more liquefied natural gas (LNG) imports, considering that it lacks pipeline connections with major gas producers such as Russia or the Gulf petrostates.

Shell, the world’s top LNG trader, expects global LNG demand to surge by 50% by 2040, driven by higher demand from Asia, with coal-to-gas switching in China and a boost in LNG consumption to fuel economic growth in South and Southeast Asia.

In the fiscal year 2023, India imported about 20 million tons of LNG, more than half of which from Qatar, according to government data. The United Arab Emirates (UAE) and the United States were the next two big suppliers of LNG to India.

These imports are set to jump in the coming years as India is expanding its refining, petrochemicals, and fertilizer industries, and economic and population growth spur additional demand for construction, steelmaking, and gas-fueled vehicles.

India was the fastest-growing major economy in 2023, with GDP increasing by 7.8%. It is on track to become the third-largest economy in the world by 2028, the IEA said in its World Energy Outlook 2024.

Population and GDP growth, as well as a shift towards cleaner energy, are set to nearly double India’s gas consumption to 113.7 billion cubic meters (Bcm) by 2040 from 65 billion cubic meters (Bcm) in 2023, according to Rystad Energy research last month.

Near-term demand is supported by a 51% jump in domestic gas production since 2020 but this will not be enough to meet the country’s growing demand for natural gas.


“The result is that India will continue to rely heavily on imports to satisfy its future energy needs,” Rystad Energy’s analysts noted.

Rising gas demand could prompt India to move to contract more LNG production from the Middle East, according to Kaushal Ramesh, Vice President, Gas & LNG Research, at Rystad Energy.

“The geographical proximity of the two regions, combined with the substantial volume of uncontracted LNG production in the Middle East, presents an excellent opportunity for India to secure favorable terms – it’s an ideal buyer-seller relationship that could help fuel India’s needs,” Ramesh said.

India’s gas demand growth will be driven by industry. Natural gas is the input for the production of urea, key for fertilizers. India will continue to support urea production, regardless of natural gas prices, as it aims to ensure food security, Rystad says.

Then there is the refining sector, which also consumes a lot of natural gas. Indian refiners plan capacity expansions to meet rising demand for fuels and petrochemicals.


Moreover, India aims to be a refining hub in Asia as it is boosting refining capacity and expects to continue relying on fossil fuels until at least 2040.

India’s natural gas consumption is set to triple by 2050 amid industry expansion and rising oil refining, the U.S. Energy Information Administration (EIA) said earlier this year.

In 2022, India’s natural gas consumption amounted to 7.0 billion cubic feet per day (Bcf/d), with over 70% of the demand coming from the industrial sector. By 2050, India’s natural gas consumption is set to more than triple to 23.2 Bcf/d, according to EIA’s estimates.

Among India’s five consuming sectors, the industrial sector’s share of gas consumption will grow the most, rising to 80% of total consumption, followed by the transportation sector rising to 10%.

By 2050, gas consumption will surge by more than 250% for the production of basic chemicals and by more than 400% for refining, with the two industries together accounting for about 79% of India’s industrial natural gas demand in 2050, the EIA reckons.


By Tsvetana Paraskova for Oilprice.com

US Breaks Dependence on Gasoline Imports

OIL PRICE

By Editorial Dept - Nov 16, 2024

In the latest edition of the Numbers Report, we will take a look at some of the most interesting figures put out this week in the energy and metals sectors. Each week we’ll dig into some data and provide a bit of explanation on what drives the numbers.
Let’s take a look.

1. US Downstream Sector Keeps on Giving Despite Shrinking Margins



- US refiners saw their average earnings per share decline to 25 cents this past quarter from $4.75 per barrel in Q3 2023 and $4.85 per barrel in Q3 2022.
- Nevertheless, shareholder returns remained very robust at $5.2 billion in total, as demonstrated by Marathon which paid $3 billion to its shareholders and has $8.5 billion in share buyback authorizations.
- Weaker gasoline and diesel cracks on the back of an oversaturated Atlantic Basin fuel market put a lot of pressure on refiners, as Valero and Marathon are up 6% on the year compared to the energy sector’s average growth of 13%.
- Margins are expected to be relatively weak in Q4 this year, with some respite coming early next year once LyondellBasell shuts its 257,000 b/d Houston refinery.


2. US Breaks Dependence on Gasoline Imports



- The United States is the world’s single largest gasoline market, however, due to regional discrepancies continues to import gasoline from other regions, mostly Europe.
- This trend now seems to be ebbing as gasoline imports to the U.S. averaged only 320,000 b/d in October, the lowest monthly reading in at least a decade, according to Kpler data.
- This comes as US refiners cranked up gasoline production after maintenance, tallying up only 333 unplanned outages across the country in Q3, the lowest number in three years.
- US gasoline demand has held up quite nicely against a creeping hybrid/EV market penetration, with the EIA’s demand metric showing consumption around 9 million b/d, unchanged from a year ago.

3. Chinese Overcapacity in Copper Aggaravates Trump Risks




- Chinese overcapacity has become one of the key market trends in metal and renewable markets this year, with copper facing its very own dilemma of Chinese domination.
- China already controls half of copper refining globally and continues its capacity expansion at breakneck speed, hurting European or Chilean operations as it is set to mark another 5% annual increase in 2024.
- The pressure on smelters is such that copper treatment fees are expected to drop to a mere $40 per metric tonne next year, halving compared to 2024 levels and marking the lowest level since 2004.
- Meanwhile, copper prices have plunged following Donald Trump’s re-election and expectations of tariff wars leading to trade disruptions, with the three-month LME contract shedding 8% since and trading below $9,000 per metric tonne.

4. Buoyed by China’s EV Bonanza, Electric Vehicles Rise Higher



- Global sales of fully electric and hybrid vehicles rose to another all-time high in October, hitting a 35% year-over-year growth rate led by a 54% annual jump in Chinese EV sales.
- European sales readings are posting only moderate increases after most government subsidies were scrapped, however the continent is still in the green with a 0.8% year-over-year rise
- China now accounts for 70% of global EV sales and that metric could even go higher in November-December, traditionally robust months for Chinese car buyers.
- In the United States and Canada, sales of electric vehicles were up by 11% from a year ago at 0.16 million units, however North American sales are just a half of Europe’s and one-seventh of China’s.

5. After Years of Freefall, Lithium Starts to Rise Again




Lithium prices are finally on the rise thanks to strong automotive demand in China and supply cuts, with lithium carbonate prices gaining more than 8% over the past month and hitting a three-month high.
Beijing has expanded subsidies for prospective EV buyers to $3,000, buoying demand, whilst prices were also lifted by speculation that external buyers are stocking up lithium ahead of potential tariff wars.
Simultaneously, some 190,000 metric tonnes of lithium mine capacity was shut by producers this year due to the profitability of mining, with another 50,000 mtpa delayed.
The price rally could be relatively short-lived as metal analysts still see a slight balance surplus in 2025 and rising protectionism presents a notable downside risk for lithium miners.

6. Europe Hits a Premium vs Asia as Supply Risks Proliferate



Northwest European LNG prices flipped to a premium vis-a-vis Asian benchmarks for the first time in 2024, trading just a tad north of $14 per mmBtu, some $0.30 per mmBtu higher than JKM.
Alongside the still unresolved Ukraine-Russia gas transit conundrum and streaks of cold weather in November, litigation between Russia’s Gazprom and Austria’s OMV emerged as a new pain point.
The Austrian energy major warned of potential disruptions in Russian gas supply as soon as this month as it seeks to recover the $243 million arbitration award from Gazprom in delivered gas.
Gas inventories have been depleting quicker than last year, with the rate of withdrawals averaging 0.039% this winter compared to the 0.09% injection rate in the same period of 2023, leading to mountain temperate concerns, too.


7. Here Come the Chip Wars



According to Reuters, the US Department of Commerce ordered the world’s largest chipmaker, Taiwan’s TSMC to halt shipments of advanced chips to Chinese customers.
The order specifically targets sophisticated chips of 7 nanometers or of more advanced design, seeking to halt the supply that feeds China’s AI accelerator and graphic processing units.
The ban comes after TSMC notified the Commerce Department that one of its chips has been found in a Huawei AI processor, in an apparent violation of export controls.
Beijing has reacted to the chip export ban by saying that the US seeks to raise tension in the Taiwan straits and that the move undermined the commercial interests of Taiwanese companies.

That’s it for this week’s Numbers Report. Thanks for reading, and we’ll see you next week.

KEYSTONE PIPELINE REDUX

TC Energy CEO sees opportunity in Trump win as company refocuses on natural gas

By The Canadian Press

November 19, 2024 

CALGARY — Donald Trump’s return to the White House is good news for Canada’s energy sector and an opportunity for TC Energy Corp., the CEO of the Calgary-based pipeline company said Tuesday.

François Poirier made the comments in a phone interview following TC Energy’s investor day presentation in Toronto. He said the former U.S. president’s re-election has been “top of mind” for the company, which has a network of natural gas pipelines in Canada, the U.S. and Mexico.

“He (Trump) is very focused on affordability. He understands the role that energy plays, and energy security, on the international stage,” Poirier said.

“Having the free flow of energy between the three countries in North America is very important. Natural gas and oil want to flow south, generally speaking. And having more supply of oil and gas from Canada will help contribute to lower prices in the U.S.”

As a company, TC Energy has already seen first-hand how business can flourish or be derailed by political winds south of the border.

Its Keystone XL project — a 1,900-kilometre proposed crude oil transportation pipeline that would have carried oil from the oilsands of northern Alberta to the major U.S. crude storage hub at Cushing, Okla. and then on to Gulf Coast refineries — was first proposed under the Obama administration, which rejected it on environmental grounds.

Keystone was then revived under the first Trump administration, before President Joe Biden killed it again by revoking the pipeline’s permit on his first day as president in 2021.


Last month, TC Energy completed the spinoff of its crude oil pipeline business into a new company called South Bow Corp., and as a result, TC is no longer the owner of the Keystone system.

South Bow “supports efforts to transport more Canadian crude oil to meet U.S. demand,” the company said in an emailed statement provided Tuesday by spokeswoman Katie Stavinoha.

“South Bow’s long-term strategy is to safely and efficiently grow our business,” the statement said.

But Poirier said the Alberta government has already reached out to TC in the wake of the U.S. presidential election, keen to see if that project could be revived or if there are other ways to increase Alberta’s oil and gas pipeline export volumes to the U.S.

Trump has proposed sweeping tariffs on all U.S. imports, but most experts believe Canadian oil and gas would be exempt from such a plan due to the highly integrated nature of the North American energy system. Trump has also been a vocal supporter of oil and gas generally, calling for more domestic drilling and tapping Liberty Energy CEO Chris Wright for secretary of the U.S. Department of Energy.

“We’ve had high-level conversations (with the Alberta government) around Keystone XL. We did mention that project is owned by South Bow ... and for conversations around increasing the export of crude oil from Alberta, that would be for South Bow to consider,” Poirier said.

“Our conversations have been more around expanding access to U.S. markets for natural gas — both for export to international markets as well as into the U.S. markets, particularly in the northwest and the Midwest of the U.S. where Canadian natural gas has important market share.”

For TC Energy, a second Trump administration is timely because it coincides with what is already a renewed focus on natural gas for the company. The spin-off of South Bow was designed to enable TC Energy to pursue a natural gas-focused strategy at a time when the company sees growing demand for the commodity.

TC believes a combination of factors — including the phase-out of coal-fired power, increased exports of liquefied natural gas, growing electrification, and the rise of power-hungry data centres to fuel the AI revolution — will lead to a dramatic increase in natural gas usage in North America in years to come.

It predicts North American natural gas demand rising to a total of 160 billion cubic feet per day by 2035, an increase of 40 billion cubic feet per day from today’s levels. The company also believes natural gas and electricity will account for 75 per cent of total growth in overall North American energy consumption by 2035.


“We have seen this developing for quite a number of years ... What I would say, however, is the degree of visibility that has developed over the last 12 months or so around data centres and around the importance of LNG exports has been more rapid,” Poirier said.

Approximately two-thirds of the 350 or so data centres currently proposed or under construction in North America are within 50 miles of TC Energy’s assets, Poirier said, meaning the company is uniquely poised to benefit from the AI boom by supplying much-needed natural gas infrastructure to the power-hungry industry.

While some hyperscale data centre operators south of the border have announced investments in nuclear or renewable power to reduce their emissions profile, Poirier said he is confident natural gas will play a major role in the industry’s growth.

“The issue with wind and solar is that on its own, you don’t have 100 per cent reliability because these data centres operate on a 24/7 basis,” he said.

“They consume energy on a 24/7 basis, which is why we’re so confident in the role that natural gas will play in empowering data centre growth.”

On Tuesday, TC Energy announced it has green-lit a total of about $1.5 billion in capital spending across four new projects, including two in the U.S. that will help with coal-to-gas conversion at two existing power plants as well as the sanctioning of a liquefied natural gas peaking project in southeast Virginia.

It also said its share of the capital required at an expansion at Bruce Power is about $175 million.

Poirier said the company is committed to remaining within its previously sanctioned $32 billion sanctioned capital growth program between now and 2027, but added the prospective opportunities related to natural gas right now are huge.

“We see probably twice the opportunity set that we can afford to spend our human and our financial capital on, based on all the opportunities in our footprint,” he said.

“Actually the skill that we’ve had to learn is how to say no, because we see so many good projects come across our desks.”

This report by The Canadian Press was first published Nov. 19, 2024.

 

Hong Kong Maps Action Plan on Green Maritime Fuel Bunkering

Hong Kong mapped its action plan to develop green bunkering operations (file photo)

Published Nov 18, 2024 7:31 PM by The Maritime Executive

 

 

The Government of Hong Kong hosted a presentation on Friday, November 15 to detail its action plan to promote the development of Hong Kong into a high-quality green maritime fuel bunkering center. As one of the busiest ports in Asia, the government looks to catch up and remain competitive with regional rivals such as Singapore while incorporating the central government’s decarbonization plans and anticipated industry demand.

Hong Kong’s Chief Executive announced in the 2023 Policy Address the goal to develop Hong Kong into a green maritime fuel bunkering center. In addition, China’s Five-Year Plan calls for measures to promote the development of green ports and enhance the promotion and application of clean maritime fuels.

The Transport and Logistics Bureau (TLB), in collaboration with the Environment and Ecology Bureau, reports it has conducted a feasibility study and proceeded to formulate the Action Plan released on Friday by taking into account international experiences and the current market developments, as well as in consultation with the Hong Kong Maritime and Port Board (HKMPB) and various organizations and players in the industry.

The Action Plan also reflects the expectation that the International Maritime Organization will promulgate a maritime fuel standard and launch a global maritime carbon pricing mechanism by 2027 driving the need to develop green bunkering capabilities. 

Among the goals set for Hong Kong is reducing carbon emissions for Hong Kong registered vessels by at least 11 percent compared to 2019 levels. They are also seeking to ensure that 55 percent of the diesel-fueled vessels in the government fleet switch to using green fuels by 2026. Carbon emissions from the Kwai Tsing Container Terminal are targeted to fall by at least 30 percent compared to 2021 levels.

Among the goals of the Action Plan to to ensure that at least seven percent of Hong Kong-registered ships take up green maritime fuels by 2030. The government projects that the bunkering service will involve over 200,000 tonnes of green maritime fuels by 2030, with at least 60 bunkering operations.

"This Action Plan fully reflects the Hong Kong Special Administrative Region Government's determination to develop green maritime fuel bunkering, and provides clear and definite directions and action targets for Hong Kong to keep pace with the international trends of green shipping,” said Lam Sai-hung, Hong Kong’s Secretary for Transport and Logistics.

The plan sets out five strategies and 10 actions to develop the supply and infrastructure for green maritime fuels. The government reports it has identified a land parcel near the port for green maritime fuel storage and expects to invite expressions of interest from the industry next year in developing the designated site. It will also facilitate the first LNG ship-to-ship bunkering demonstration by the industry within the first half of 2025. It also plans to establish a Green Maritime Fuel Bunkering Incentive Scheme to encourage enterprises to start green maritime fuel bunkering businesses in Hong Kong.

To build the supply chain for green maritime fuels, the government will also seek to facilitate offtake agreements between the green fuel bunkering supplies from the mainland and shipping companies.

By early next year, the government expects to release a comprehensive Code of Practice both for LNG and methanol bunkering. These steps are viewed as a key part of the strategy to build Hong Kong’s role in the future green bunkering marketplace.
 

Vancouver Accredits Seaspan Energy for First LNG Ship-to-Ship Bunkering

Seaspan Energy is building three LNG bunker vessels to start the first ship-to-ship operation based in the Port of Vancouver (Seaspan Energy)

Published Nov 19, 2024 6:03 PM by The Maritime Executive

 

 

The Port of Vancouver and Seaspan Energy took a key step forward to launching the first ship-to-ship LNG bunkering operation for a wide range of vessels calling at the port. The company went through an extensive multi-year assessment process conducted by the Vancouver Fraser Port Authority in collaboration with other Canadian authorities to ensure the safety of the new operation.

Seaspan Energy is working toward launching its LNG bunkering operation along the West Coast of North America. Harly Penner, Senior Vice President of Seaspan Energy called the accreditation a “meaningful step,” towards the start-up of the Vancouver-based LNG bunkering hub.

The first two of three newly built 7600 cbm LNG bunkering vessels are due for delivery in the near future with a third scheduled for 2025. The LNG bunkering vessels are being built by CIMC Sinopacific Offshore & Engineering after Seaspan Energy worked closely with the Canadian-based team at VARD Marine to incorporate emerging technologies resulting in a decrease in emissions and underwater noise.

Each of the vessels will be approximately 113 meters (approximately 370 feet) in length with a design speed of 13 knots. Seaspan reports the design is focused on safe, efficient, and economical refueling of multiple ship types with an ability to transfer to and from a wide range of terminals. The vessels will be engaged in ship-to-ship LNG transfer along with coastal and short-sea shipping cargo operations.

 

Three vessels due for delivery in 2024 and 2025 will provide the new ship-to-ship bunkering operation (Seaspan Energy)

 

The first of the vessels, Seaspan Garibaldi was launched in January 2024. It was followed by the launching of Seaspan Lions in April and Seaspan Baker in July.

The Port of Vancouver highlights that it is a key step in its efforts to meet industry demands and proceed with sustainability programs.  They expect to be able to provide bunkering operations to a wide range of vessels including Ro-Ro vehicle carriers, tankers, containerships, and cruise ships expanding the role of the port in the West Coast trade.

The safety assessment program incorporated international best practices, assessed operational procedures, and produced a risk assessment. Vancouver approved designated locations for LNG bunkering operations within the port area. 

The port authority is also requiring Seaspan Energy to renew its license annually to ensure it continues to meet the highest LNG bunkering safety standards and procedures.

As winter approaches, UK pays more for gas than EU, sparking anger among Remainers

Gabrielle Pickard-Whitehead 

Yesterday

LEFT FOOT FORWARD


‘Endless is the victory.’

As it tries to outbid neighbouring countries for limited supplies as we head into winter, Britain is paying more for natural gas than continental Europe.

Data by the pricing agency Argus Media which was published by the Financial Times, found that UK gas prices for delivery rose to more than €1.6 per megawatt hour above the European benchmark, while prices for delivery next month have reached €1.5/MWh higher than Europe.

Both levels mark the widest points relative to Europe since late 2021, when Russia began reducing the amount of pipeline gas it sent, although the gaps have since narrowed slightly.

Gas storage facilities in Europe are almost full but is not enough to meet what Europe will need this winter. As a result, Europe will need to continue importing pipeline gas and liquified natural gas (LNG), meaning it will be in competition with the UK for supplies.

As the FT reports, the price difference has been worsened by structural problems in the UK’s gas system, including a lack of storage and high transmission costs. Britain can only store a maximum of 3.1bn cubic metres of gas, meaning demand has to be mostly met with imports. Conversely, countries like France, Germany and Italy, have between 15 and 25bn cubic metre capacity, meaning they rely less on imports. European nations are also interconnected with a network of pipelines, allowing flexible supplies between countries.

Around half of the UK’s gas needs are currently met by imports, and National Gas, which owns the country’s main transmission network, expects more than 60 percent of the UK’s gas to come from imports this winter.

Additionally, a shortage of available liquefied natural gas globally, means the UK is having to offer a much higher price to try to secure the supplies it needs.

If this winter is colder than average, the UK could pay even more over European prices, analysists have warned.

“Now that colder weather is setting in, driving up households’ gas use, the UK must compete with EU markets for available LNG and pipeline gas supply,” said Natasha Fielding, head of European gas pricing at Argus Media

The FT’s report sparked anger among Remainers who were quick to remind how Brexiteers promised the UK cheaper energy bills.

Boris Johnson made the claim several times during the EU referendum campaign in 2016. Leave campaigners argued Britain’s energy bills will be slashed by £2 billion a year if voters back Brexit because it would allow ministers to scrap the ‘unfair’ VAT tax on gas and electricity.

Boris Johnson told the Sun: ‘In 1993, VAT on household energy bills was imposed. This makes gas and electricity much more expensive.

“EU rules mean we cannot take VAT off those bills. The least wealthy are hit particularly hard. As a proportion, the poorest households spend three times more of their income on household energy bills than the richest households spend.

“As long as we are in the EU, we are not allowed to cut this tax. When we vote Leave, we will be able to scrap this unfair and damaging tax.

Remainers dismissed the claims at the time, with then chancellor George Osborne and former PM David Cameron branding it ‘fantasy economics.’

“Endless is the victory” wrote Sheffield for Europe, in response to the recent news that the UK is paying more for natural gas than continental Europe as we head into winter.

“Heating or eating? Since Brexit, energy costs have surged, forcing people to make impossible choices. The promises were cheaper bills; the reality is colder homes,” wrote the Rejoin EU Party on X.

 

Video: Disney’s Newest Cruise Ship Rescues Sinking Catamaran in Atlantic

Disney Treasure maneuvered close to the catamaran and its tender rescued the four people with the USCG helicopter overhead (USCG)

Published Nov 11, 2024 11:20 AM by The Maritime Executive

 

 

Disney Cruise Line’s new ship, the Disney Treasure (144,236 gross tons) has already caulked up its first heroic act even before it enters service. The brand-new cruise ship on its repositioning trip after delivery from its builders Meyer Werft to its homeport in Port Canaveral, Florida diverted yesterday to save four recreational boaters from their sinking catamaran.

The 1,119-foot (341-meter) cruise ship departed the Netherlands on October 29 bound for Port Canaveral. After making a technical stop in Funchal a week ago, the ship was on the final leg of its crossing only with crew aboard. When the compliment is complete the ship will have 1,555 crew with those aboard now learning the new ship and training in advance of the first paying passengers joining the ship next month.

The U.S. Coast Guard reports it received a distress call Sunday, November 10, at 0830 from a 50-foot catamaran with four people aboard. It was located about 230 nautical miles southwest of Bermuda and reported that a gasket had failed causing the ship to take on water. The four passengers were preparing to abandon their vessel.

 

 

Coast Guard Air Station Elizabeth City (North Carolina) responded while they also determined the new Disney ship was the closest vessel to the catamaran in distress. The crew of the Disney Treasure responded coordinating the rescue with the passengers on the boat. When they reached the catamaran, one of the new cruise ship’s lifeboats was launched to retrieve the four people from the catamaran.

“We are pleased that the Disney Treasure was able to provide aid to the boat passengers in peril. Our crew members worked together on the rescue, skillfully demonstrating their training and commitment to safety,” said Captain Marco Nogara, master of the cruise ship.

The four people have become the first passengers on the new cruise ship. The Disney Treasure’s AIS signal shows an arrival tomorrow, November 12, in Port Canaveral. The ship the second in the Disney Wish class, the new LNG-fueled cruise ships building for the line, is due to complete its final fitting out and crew training before embarking its first paying passengers in December.

Europe Parliament Calls for Crackdown on Russia’s Shadow Fleet

European Parliment is calling for crackingdown on shadow tankers with inspections, monitoring, and seizing illegal cargo (file photo)

Published Nov 14, 2024 3:08 PM by The Maritime Executive

The members of the European Parliament on Thursday, November 14, overwhelmingly approved by a show of hands a new resolution calling for enhancing the enforcement of the price cap on Russian oil by cracking down on the shadow fleet. While the Parliament is proposing to move to a ban on Russian energy imports, reports are saying Germany has already taken that move at its state-operated gas import terminals.

The resolution in Parliament comes as the European Union is preparing its next round of sanctions on Russia and considering its next steps to support Ukraine after the election of Donald Trump as the next U.S. president. The media is reporting that UK Prime Minister Keir Starmer and French President Emmanuel Macron are meeting to plan the next steps in the European strategy to support Ukraine.

A letter sent by the German economy ministry, The Financial Times reports, is instructing Deutsche Energy Terminal not to accept any deliveries of Russian LNG. Germany historically was Russia’s largest importer of LNG before the invasion of Ukraine but moved to end its dependence on Russia by establishing floating LNG import terminals.  Today’s Financial Times article reports the government is saying due to public interests it is calling on the operators to reject Russian LNG deliveries “until further notice.”

The European Parliament resolution also recognizes that the EU “must ban all imports of Russian fossil fuels.” In particular, France, Spain, and Belgium have continued their imports of Russian LNG citing long-term contracts. Their ministries have suggested the EU would have to enact a total ban to free the countries of their obligation.

The new resolution in the Parliament recognizes that Russia continues to finance its war through oil exports despite EU, G7, and international sanctions. It highlights the so-called fleet of “shadow tankers,” older vessels often uninsured and without clear ownership, as providing a “key financial lifeline.”

The European Parliament is calling for more targeted measures against the shadow fleet in the next EU sanctions package, including all individual ships as well as their owners, operators, managers, banks, and insurance companies. Among the steps they are calling for are systematic sanctions on the vessels sailing through EU waters without known insurance.

The resolution urges enhancing surveillance capabilities using drones and satellite monitoring, as well as conducting targeted inspections at sea. They want to designate ports capable of handling sanctioned vessels and call for seizing illegal cargo without compensation.

Better enforcement is required for the sanctions they agreed all in an effort to crack down on the loopholes that Russia continues to use. 

In some of its most direct language, the European Parliament says member states are urged to ban all imports of Russian fossil fuels, including LNG. They also recommend that the EU should “seriously reassess its bilateral cooperation with third countries that are helping Russia circumvent EU restrictive measures in place, if diplomatic efforts are unsuccessful.”

The EU in June 2024 adopted its fourteenth package of sanctions against the Russian economy, The European Council last month took further steps by establishing a new framework for restrictive measures including allowing the EU to target individuals and entities engaged in the activities.

 Last week, after the U.S. elections, Josep Borrell, Vice-President of the European Commission and its top diplomat, visited Ukraine to reassure officials of the EU’s unwavering commitment. He said the next sanctions package, the EU’s fifteenth, was currently being prepared.
 

 

Malaysia’s MISC and Armada Explore Merger to Form Floating Production Giant

FPSO Marechal Duque de Caxias, MISC's newest FPSO marked its first oil prodcution in October 2024 (MISC)

Published Nov 14, 2024 8:08 PM by The Maritime Executive

 

Two of Malaysia’s leading offshore energy and shipping companies announced today, November 14, in a stock exchange that they are commencing merger talks. MISC Berhad and Bumi Armada Berhad signed a non-binding memorandum of understanding to explore a prospective merger.

The companies stated that the talks are at an “early stage of evaluation” warning there is no certainty that ongoing discussions will result in an agreement. The MOU is effective for nine months and until either the execution of a definitive agreement or an agreed termination. 

The discussions focus on combining MISC’s Offshore Business with Armada and they anticipate the resulting company would remain a publicly-traded entity on the Malaysian stock exchange.

Explaining the rationale behind the potential merger, the companies highlighted the merged entity would be among the leading floating production businesses globally with the scale, resources, and financial capacity to compete in the growing and capital-intensive offshore floating production segment. The filing notes that the proposed merger would establish a Malaysian-based sector-focused entity that leverages the combined talent pool, project development, and engineering capability, and know-how of both MISC’s offshore business and Bumi Armada.

MISC, which is majority-owned by the Malaysian state energy firm Petronas, notes its history started in 1968 and since then has grown to become one of the global leaders in the transportation of energy in the maritime industry. Describing its offshore business, it calls it one of the world’s largest FPSO/FSO owner and operators with 12 assets, including the first and largest semi-submersible floating production system in Asia. 

At the end of October, MISC reported that the FPSO Marechal Duque de Caxias, one of the largest ultra-deepwater FPSOs in the world, had achieved its first oil. The FPSO is chartered to Brazil’s national oil and gas company, Petrobras on behalf of the Libra Consortium, which developed the Mero unitized field, and has a production capacity of 180,000 barrels of oil per day, storage capacity of 1.4 million barrels, and total gas handling capacity of 440 mmscfd.

Bumi Armada highlights that it has a range of capabilities including field development support, production facilities, installation & operations, pipe-laying, hook-up, and commissioning. Currently, it is operating seven FPSOs as well as one LNG FSCU between Asia, Africa, and Europe and has two construction vessels. The company also recently entered into the upstream sector and is working on developing and carbon capture and storage joint venture with Navigator Gas called Bluestreak CO2. The joint venture is expected to design and implement a value chain of liquid CO2 shuttle tankers capable of loading from and delivering to floating carbon and storage (injection) units, and subsequently injecting CO2 into offshore storage aquifers and/or depleted oil and gas reservoirs.

Combined the two operations would have the opportunity to expand their global role at a time when the market is rapidly evolving. The companies said they would provide updates if they agree on terms and the conditions of the proposed merger.

Fudged Figures, Gas, and Debt: Digging into MDBs’ “Climate Finance”

Half of all Multilateral Development Banks’ climate finance goes to Europe. Just 4% is grants. We don’t just need more but better climate finance.

By Petra Kjell Wright

November 15, 2024

Source: African Arguments

At the COP29 climate talks, World Bank President Ajay Banga (middle) committed to increase climate finance available through MDBs for low- and middle-income to $120 billion per year by 2030, much of it through leveraging private sector investment. Credit: Madeleine Race/Recourse.



At the COP29 climate talks, World Bank President Ajay Banga (middle) committed to increase climate finance available through MDBs for low- and middle-income to $120 billion per year by 2030, much of it through leveraging private sector investment. Credit: Madeleine Race/Recourse.

This week, at the COP29 climate talks, the multilateral development banks (MDBs) are patting themselves on the back. Side events, panels, and press releases all celebrate their achievements in aligning their activities with the Paris Agreement and delivering climate finance at record levels – $125 billion in 2023. The MDBs, including the World Bank and the African Development Bank, claim to “drive transformative change” in global climate action. However, a new report by Recourse, supported by 18 organisations and networks, tells a very different story – and raises critical questions about what “climate finance” actually is in the eyes of the MDBs. This comes at a critical moment with a new climate finance goal on the table at COP29.

The report scrutinised the MDBs’ own figures and found a plethora of problems. One of these is a lack of transparency on what is being counted. For example, Oxfam could not verify 40% – that’s $7 billion – of what the World Bank claimed as climate finance for one fiscal year. The Asian Infrastructure Investment Bank (AIIB) declared that they reached their target for 50% of their financing approvals to be for climate finance in 2022, three years early to their 2025 deadline, but failed to make the relevant data public. Meanwhile, the African Development Bank (AfDB) has not published any public record at all of what it counts as climate finance.

The funding is also not flowing to where it is most needed. Almost half of all MDB climate finance for 2023 did not go to the world’s most climate vulnerable countries. Instead, it went to Europe. Sub-Saharan Africa received a fraction – just 14% – and Asia little more – 21%. And despite public finance’s particularly important role in supporting efforts to adapt to climate change impacts, almost 80% of MDB climate finance went to emissions reduction activities (referred to as mitigation).

The financing models are also concerning. Climate Action Network (CAN) International, a network of over 1,900 civil society organisations, calls for climate finance to be delivered as grants, yet just 4% of MDB climate finance in 2023 came in this form. 70% took the form of loans. The Asian Development Bank (ADB) reported an even higher level of loans at 96%, while the AIIB has no proper grant function at all. Disturbingly, this means that climate finance is worsening the debt crisis in many countries and further undermining countries’ ability to deal with climate change.

Besides these critical issues lie a more fundamental problem – the fact there is no agreed definition of what “climate finance” is in practice. In this void, the MDBs have come up with their own principles for what type of projects count as climate finance, but with some significant flaws. The only kinds of projects that are fully excluded are coal and peat projects, as well as those leading to deforestation. However many other initiatives are allowed to be counted as climate finance, subject to some restrictions. This includes false solutions like carbon capture and storage, which is costly and not proven to work at scale, and highly polluting and greenhouse gas intensive waste-to-energy (WTE) incineration projects.

Another problem is that part of a project can be counted as climate finance, even when the rest of the project is highly greenhouse gas intensive. When scrutinising the MDBs’ publicly available documentation, there are some surprising and concerning finds. The AIIB, for example, counted almost half of its $153 million funding for an airport expansion project in Turkey as climate finance, disregarding the fact it will double the airport’s capacity – and in turn, more than double its emissions. The same bank also counted part of a greenfield gas power plant set to run for at least 22 years as climate finance – despite the long-term carbon lock-in that it represents for Bangladesh, one of the world’s most climate-vulnerable countries. There is even evidence an MDB counted funding of a mega LNG project in East Africa as climate finance, according to OECD.

But the Paris Agreement isn’t just about greenhouse gas emissions and environmental destruction – it also calls for human rights obligations to be respected and promoted. Yet the MDB principles for climate finance are void of any requirement to protect and support those most vulnerable, including women and girls. They are completely gender blind. According to the MDBs, they rely instead on their own policies, which differ across the banks. But there is a wide range of evidence showing how these are lacking in numerous respects. For example, the AIIB and the ADB counted their investments in a hydroprower project in Nepal that has severely marginalised and displaced local Indigenous peoples, with women worst impacted, as 100% climate finance. In Mongolia, civil society is protesting a “climate smart” mining project, also counted as 100% climate finance by the ADB, due to the high risks to local communities, including Indigenous peoples.

In the first week of COP29, World Bank President Ajay Banga announced a big commitment to increase climate finance available through MDBs for low- and middle-income countries. He set an annual goal of $120 billion by 2030, much of it through leveraging private sector investment. But before they scale-up the quantity, the banks need to reassess the quality. Ultimately, the MDBs are accountable to the farmers, workers, women, Indigenous peoples, and the most marginalised communities in developing countries. These are the people that their climate finance should serve, whatever the goal agreed by countries here at COP29.

 

ALT. FUEL

Guinness World Record for Power Set by Damen-Built Electric Tug in UAE

Damen's electric tug delivered to AD Ports set a new record for pull power for electric tugs (Damen)

Published Nov 12, 2024 7:44 PM by The Maritime Executive

 

 

Fully electric tugs have quickly emerged from a novelty in the industry and now Damen Shipyards Group and its client SAFEEN Group, part of AD Ports Group’s Maritime & Shipping Cluster, have set a Guinness World Record as the Most Powerful Electric Tugboat. The vessel delivered earlier this year demonstrated what the companies are calling “unprecedented for a fully electric tug” and further the growth of this sector of the industry.

The record was set by measuring the bollard pull of Damen RSD-E Tug 2513 Bu Tinah, which achieved an average high peak pull of 78.2 tonnes. It is the first fully electric tug to operate in the Middle East and now has the unique distinction of the unique honor by a world-recognized body for record keeping. Launched in 1954 as a promotional idea for the Guinness Brewery, the Guinness Book of Records (today Guinness World Records) is an often-quoted source of data.

“This Guinness World Record achievement demonstrates that the transition to alternative energy does not come at the cost of performance,” said Captain Ammar Mubarak Al Shaiba, CEO – Maritime & Shipping Cluster, AD Ports Group. “We are very proud that the first electric tug in the Middle East is also making waves on a global level with this accolade and the fact that in parallel it is improving the sustainability of our operations alongside cost efficiencies in terms of overall fuel saving is extremely important.”

The record-breaking performance took place at Khalifa Port, AD Ports Group’s flagship facility where the tug is a key component of AD Ports Group’s Marine Services fleet and its electrification strategy.

The RSD-E Tug 2513 according to Damen is designed with a focus on sustainability. It offers zero emissions from tank to wake playing a significant role in reducing emissions.

The RSD-E Tug 2513 builds on the already efficient design of the diesel propulsion RSD Tug 2513. The spec sheet highlights a 320 gross ton tug with a length of 24.73 meters (81 feet). It is designed to operate at a speed of up to 12 knots and can be recharged in two hours. 

The vessel can operate with a crew of just two or three persons or a maximum of up to sic and can be customized with options for oil and pollution control or fire fighting. 

The electric version according to its spec sheet is very similar to the earlier diesel version which has a maximum bollard pull of 80 tonnes. It operates at a speed of 12.6 knots.

Damen has been at the forefront of electric tug development, including delivering the world’s first electric harbor tug, aptly named Sparky, in 2022 to Ports of Auckland. It won the prestigious “Tug of the Year” at the 2022 International Tug and Salvage Awards ceremony and pioneered the growing deployment of electric tugs in ports around the world.

Effort to Develop First U.S. Liquid Hydrogen-Fueled RoPax Ferry

SWITCH promotes the move to a larger platform to enable the U.S. adopt liquid hydrogen fueled vessels (LMG Marin)

Published Nov 11, 2024 6:05 PM by The Maritime Executive

 

An effort is underway to leverage the cutting-edge technology for hydrogen-fueled vessels to develop the first RoPax vehicle ferry in the U.S. to be fueled by liquid hydrogen. SWITCH Maritime, the U.S. shipowner that launched the first hydrogen-powered ferry in the U.S. is in collaboration with LH2 Shipping and LMG Marin in Norway to commence construction in the U.S. of a hydrogen-fueled RoPax ferry.

SWITCH’s first hydrogen-powered vessel, the Sea Change, is a 75-passenger catamaran ferry featuring 600 kW of electric motor propulsion, powered by 360 kW of fuel cells with 246 kilograms of gaseous H2 (GH2) storage at 250 bar pressure. The Sea Change started public passenger service as part of the San Francisco Bay Ferry system in July 2024, after receiving its final Certificate of Inspection (COI) from the U.S. Coast Guard in May 2024.

“With rigorous planning, state-of-the-art engineering, and support from leading industry partners and the U.S. Coast Guard, we are ready to pioneer zero-carbon LH2 fueling for heavier, higher-horsepower workboats,” explains Pace Ralli, Founder & CEO of SWITCH.

They plan to develop a vessel using the designs from LMG Marin for an 80-car, 300-passenger RoPax vehicle ferry. The design is already DNV classed and is being successfully operated by Norled. Named MF Hydra, the ferry performs a triangular six nautical mile round-trip fueled with liquid hydrogen (LH2). The companies highlight it has a four-tonne LH2 tank (about the size of a 40-foot container) that fits easily on the top deck and receives fuel from an LH2 truck via a bunkering system using over-pressure in the truck to push the liquid to the ship. To date, MF Hydra has successfully received LH2 fuel approximately 50 times since starting hydrogen-powered operations in March 2023.

The RoPax vehicle ferry will have a service speed of 14 knots and is expected to require fueling only once per week (volume of 3000 kilograms from one LH2 truck) in a typical operation, with no requirement for shoreside electric charging infrastructure. While the design will require some further adapting to meet USCG requirements, SWITCH notes the larger steel hull of the vehicle ferry offers more flexibility in terms of space and weight compared to aluminum catamaran fast ferry designs, making it an ideal platform for introducing LH2 fueling in the U.S. The LH2 from the cryogenic storage tanks is vaporized onboard and used in the PEM fuel cells to create electricity for the electric motors. Like the GH2 fast ferries, the vessel’s only emissions will be pure H20 vapor, with zero carbon or other diesel-related emissions.

In addition to the Sea Change, SWITCH is also working on a 150-passenger, 25-knot catamaran to build for the SF Bay Ferry service, using the same gaseous H2 (GH2) storage and fuel cell equipment as the first vessel (to be revealed in Q1 2025). When designing larger zero-emissions harbor craft such as 300+ passenger ferries, vehicle ferries, and harbor tugs, SWITCH plans to transition from gaseous storage to cryogenic liquid H2.

SWITCH has focused on hydrogen for its potential to serve as a viable option highlighting its belief that other battery-only solutions fall short due to space and weight constraints. The company notes that generally, hydrogen as a fuel source can support greater range and power requirements due to its high energy density. Additionally, it simplifies zero-emissions vessel operations by eliminating the need for fixed shoreside charging infrastructure, allowing for fueling through established truck-to-ship or ship-to-ship practices. Compressed GH2 SWITCH says is well suited for small- to medium-sized vessels; however, as vessel size and energy demand increase, cryogenic LH2 becomes the preferred storage solution. Similar to Liquefied Natural Gas (LNG), cryogenic LH2 supports faster refueling speeds for large volumes (e.g. tons per hour).

Maersk Tankers Adopts Wind-Assisted Propulsion with Landmark Deal

Maersk Tankers will add wind-assisted propulsion using suction sails on five vessels (Maersk Tankers)

Published Nov 11, 2024 4:38 PM by The Maritime Executive

Maersk Tankers is becoming the latest blue chip brand in shipping to embrace wind-assisted propulsion technology to help it meet its aspirations for reducing emissions. The tanker operator selected suction sales for five of its medium-range tankers giving Spain’s Bound4blue its largest agreement to date for its wind-assisted propulsion system.

With over 240 tankers and gas carriers, Maersk Tankers reports it is continually exploring and adopting advanced energy-efficient technologies. The company demonstrated wind-assisted propulsion in 2018 with the installation of rotor sails on the Maersk Pelican and recently retained Njord, a specialist in green solutions for the maritime industry, to assist in assessing and evaluating a broad range of wind-assisted propulsion systems.

Maersk Tankers awarded a contract to Bound4blue to install a total of 20 suction sails across five ships of the fleet. The vessels including Maersk Tacoma, Maersk Tampa, Maersk Tangier, and Maersk Teesport, built in 2015 and 2016 and each 49,800 dwt, as well as the Maersk Tokyo also built in 2016 and 44,000 dwt. 

“For the tanker industry to progress in the energy transition, concrete investments and actions are essential,” said Claus Grønborg, Chief Investment Officer for Maersk Tankers. “By implementing Wind-Assisted Propulsion Systems at scale in our fleet, we enable our customers to meet their sustainability targets, while also advancing the objectives of FuelEU Maritime and the EU Emissions Trading System."

Each of the suction sails will be 26 meters (85 feet) in height. The technology works by dragging air across its aerodynamic surface to generate lift and propulsive efficiency. Maersk Tankers report the sails will be installed during normal dry dock periods in 2025 and 2026 and they expect to realize double-digit percentage reductions in fuel consumption and CO2 missions per vessel.

“Designed to operate safely in challenging conditions, our system is particularly well-suited for safe, high performing, and cost-efficient operation on tankers,” said José Miguel Bermúdez, CEO and co-founder of Bound4blue.  He called the order a “key milestone” for the technology.

Started a decade ago in Spain, the company highlights that it has installed its eSail system on four ships. They note growing momentum having signed additional agreements with other well-known shipping companies such as Klaveness Combination Carriers, Eastern Pacific, Odfjell, and Louis Dreyfus.

The shipping industry is showing increasing interest in adding wind propulsion systems to their vessels. Several different technologies are competing and from the early results the installed systems are providing meaningful reductions in fuel consumption and supporting the goals to reduce emissions and meet emerging regulations.