Growing demand for cleaner ship fuels, and thus LNG bunkering, would result in more orders for ships running on LNG, a sector analyst has opined.
CIMB Securities analyst KJ Hwang made this conclusion after meeting industry experts at the recent South Korea-Norway green ship seminar.
Hwang noted, “Consensus was strong regarding: oil price potentially rebounding to USD80 by fiscal year 2017/18, and robust order potential for the new conceptual designs.”
Currently, there are only 59 LNG-fuelled ships operating globally, with more LNG-bunkering infrastructure investment underway.
The first LNG bunkering vessels will be available in 2016, implying a new fuel cycle for the shipowners once the first-ever LNG-ready ultra-large container ships are delivered that year, said Hwang, referring to the ships that United Arab Shipping Company (UASC) ordered at Hyundai Heavy Industries.
Hwang said, “In the past years, LNG bunker costs approximately 40% cheaper than heavy fuel oil, and have shown a stable price trajectory compared with other alternative fuels.”
The impetus to use LNG as fuel would also come with the International Maritime Organization’s new regulations that require ships to burn fuel with a sulphur content of no more than 0.1% in emission control areas.