Greece: LNG as a marine fuel

Greece is ready to enter the era of liquefied natural gas as a marine fuel, since DEPA is conducting the tender to select an advisor, which will select the shipyard to build an LNG bunker vessel.

During the first phase 23 companies expressed their interest. At the end, four of them submitted a binding offer. They are French Gazocen, Greek NAP Engineering, Spanish Seaplace and German-Chinese Schulde.

The Poseidon project

The project is a continuation of the EU’s Poseidon program and it concerns two LNG bunker vessels, one on behalf of DEPA in Greece and one on behalf of Navi Gas in Cyprus. The construction of the two vessels will have a budget of 60 million Euros, while 6 million more will be spent on infrastructure in the two countries. The EU Commission supports the project with 19.8 million (30% of total expense).

The advisor will be chosen according to the offered price in about 1-2 months and will seek the necessary shipyards in cooperation with DEPA and Navi Gas (whether in Europe or elsewhere) in order to build the two LNG bunker vessels. The program will last 45 months. The first phase for selecting a shipyard will take a year. The second phase will follow with the construction of the ships and the third step is to select a managing company.

The ships’ role

The two LNG bunker vessels will take over the supply of ships using liquefied natural gas as a fuel and they will contain 3,000 c.m. using the process of ship to ship. DEPA’s ship will be supplied with LNG from Revythousa and will operate in the Piraeus harbor, but also islands of the Aegean if there is demand. The basic consumers are expected to be new technology cruiseships, but also container ships running with LNG engines. Supply will take place inside the harbor or in the mooring.

When it comes to passenger ships, there are still none using LNG engines. Attica Group has expressed its interest to participate in the European program (which subsidizes 30% of the LNG equipment). As for Cyprus, the ship will be based in Limassol.

The BlueHUBS project

The two ships will be built as part of the European project BlueHUBS with co-financing from the EU. They will be the first LNG bunkering vessels in the wider Eastern Mediterranean region. The goal of the program is to promote as soon as possible Greece’s transition to green fuels, according to regulations by IMO, which impose the use of fuels with lower than 0.5% sulfur from 2020 onwards.

The EU Commission has promoted 49 different projects with a total of 695.1 million Euros to develop sustainable and innovative infrastructure in Europe for all transportation projects.

DEPA’s planning, however, extends even further, since there are plans to build a second bunker vessel in Greece. Its capacity is estimated to be higher, reaching even 7,000 c.m., and it will have the mission to satisfy demand in the Ionian. Initially, the prospect of building an LNG storage in Patras was examined, which will be supplied by the bunker vessel and will also satisfy onshore demand. However, according to “N”’s information from DEPA, the case of Igoumenitsa is also examined.

Demand

In following years, demand for LNG as a marine fuel is expected to rise. For example, out of 94 cruiseships under construction around the globe, 18 are designed to use LNG as a fuel. During this period, the global fleet using LNG reached 143 ships in 2018 from 118 in 2017.

Furthermore, 135 ships in total are in the orderbook and another 135 are LNG ready. Orders for ships using LNG concern all types, such as container ships, tankers, cruise ships and VLCCs.

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