Oil major Shell plays multiple roles in the maritime industry relating to decarbonisation - a fuel provider, a vessel charterer and a vessel manager.
Shell has set up some very ambitious targets to decarbonise, together with partners, suppliers and customers, said Carl Henrikson, Head, Shipping & Maritime Technology, Innovation & Digitalisation, Shell.
He was speaking at an International Chamber of Shipping (ICS) webinar on June 2, “Infrastructure Transformation - Pathway to COP 26”
“None of this is going to happen quickly, [but] a huge mistake is to sit back and do nothing and wait for all of this to play out.”
“We can move forward with LNG, its available, abundant, safe, there's a global bunkering infrastructure. If you tie that into energy efficient technologies, you start to see a reduction in emissions on ships, which is a precursor to delivering the future fuels.”
Future fuels
“If shipping is really going to make progress on decarbonisation we need to understand what's getting in the way of us doing that right now,” he said.
“We did some work last year for Shell's shipping decarbonisation ‘All Hands on Deck report'. We interviewed 80 senior leaders in industry and asked them, what is the barrier and how do we break that deadlock on decarbonisation.”
“Almost 80 per cent of participants saw alignment on future fuel as being the major barrier to decarbonisation and getting going on the journey.”
We may see a poly-fuel world as the outcome, where ships do not pick one decarbonised fuel but use many different fuels, he said.
Shell believes that hydrogen is likely to be the dominant fuel for the future, together with fuel cells onboard which convert hydrogen to electric power.
The safety risks with hydrogen and ammonia “are more challenging than with hydrocarbon fuels of today,” he said. “As an industry we must focus on overcoming and exploring these safety challenges.”
On cost, “any future fuel is going to require serious investment. We know the costs will come down the more we collaborate,” he said. We start to create economies of scale.”
“We've got to look at the long term cost of production of different fuels, and weighing up the space for maturation and optimisation.”
It is important for emissions to be considered on an end to end basis, he said. “We have to avoid moving emissions from one part of the supply chain to another. This is an entire system that must decarbonise, not just the ships.”
“There's an immense amount of work that needs to be done on analysis and testing for future fuels to be brought to market at scale. It is going to take many years before we see a future fuel at ports around the world, and for ships to use them safely and in a cost effective way.”
Technology
In terms of technology development, ammonia, methanol and hydrogen fuels have a lower energy density than standard marine fuel oil, so they need larger storage tanks on ships, and transportation systems capable of handling larger volumes. “We also need to find ways to deliver the fuel onto ships, and develop operating practises,” he said.
For hydrogen, Shell believes fuel cells will be the “enabling technology”, and it is already getting involved in research. “We don't want to sit back and wait for hydrogen to be available before we get started with the fuel cell,” he said.
Shell is looking to “get a number of consortiums up and running” to trial fuel cells on ships.
One project in Singapore being run by Shell is trialling the use of a fuel cell on a vessel working in a harbour. Another project, with Shell as a participant in a wider consortium, is trialling a fuel cell on a deep sea ship, initially to provide auxiliary power, together with LNG.
LNG
“In Shell, we believe LNG plays an important role, it is the lowest emission fuel that's available at scale in the shipping sector today, it has no near rivals in this regard,” he said.
Mr Henrikson was asked whether companies would get a viable return on investing in a vessel running on LNG, if it is only available for 10 years.
He replied that as we move to an era of zero carbon fuels, LNG could be replaced with bio LNG (gas from rotting organic matter), or synthetic LNG (gas made with renewable energy and captured CO2).
“I think that's the way we have to look at it,” he said. “What is the pathway that prolongs the use of LNG for the longer term while we work on fuels of the future?”
“It’s going to be decades, years and years, before we see future fuels coming at scale, globally.”
Cargoes become fuels
With past energy transitions in shipping, to coal and then oil, the maritime industry used fuels which the vessels were already carrying as cargoes. And the same my happen in the transition to zero carbon fuels. In other words, perhaps the maritime industry could end up using fuel infrastructure which someone else has developed for onshore purposes.
This could be a much simpler way to decarbonise than the maritime sector developing a new fuel infrastructure by itself.
“Rather than go alone, let's see what happens in the other sectors and how the energy system starts to move. That creates an opportunity for shipping to get into that, become a pipeline for whatever that commodity is, and use it as a fuel. We engage with that as a co-owned solution.”
The shipping industry has already been involved in a number of projects carrying hydrogen as a cargo, including one to carry hydrogen from Uruguay to North West Europe.
“We can focus on hydrogen because that seems to be the fuel that's working its way through,” he said.