Container ship LNG bunkering to rise: MSI

LNG for container ships bunkering has gained traction, analyst firm Maritime Strategies International (MSI) said in a report.

LNG as a bunker fuel will likely sell at about 40pc discount to very low-sulphur fuel oil (VLSFO) in 2024, according to a consensus view MSI compiled. This will increase LNG bunkering demand from LNG dual-fuel ships and create a charter premium for such vessels.

At the start of April 2023, 281 alternative fueled container ships representing 3.4mn twenty-foot equivalent units were under construction, accordign to the MSI report. Two-thirds of these are LNG dual fueled and, with the exception of the two hydrogen fuel cell container ships, the remainder are methanol dual fueled.

The container ship market has been the most open to alternative fuels. Container ships are employed on a regular liner service, the predictability of which allows for reliable bunkering operations for alternative fuels. There is also a more direct interface between container shipping and the general public, helping to expose container ship owners to external pressures to decarbonise their activities.

As a rule of thumb, LNG dual fueled newbuild containerships are 20-25pc more expensive than their conventionally fueled counterparts. The methanol dual fueled option is cheaper, at a 10-15pc premium on the standard build.

The adoption of alternative fuels in the container ship sector has been possible because of the "stratospheric" freight markets in recent years, the report says.

By Stefka Wechsler