Chinese green energy firms have been developing biomethanol plants to supply the maritime sector, and view green methanol as an attractive option to decarbonise shipping, said speakers at the Argus Green Marine Fuels Asia conference in Singapore on 18-19 February.
Used cooking oil (UCO) methyl ester (Ucome)-based marine biodiesel and green methanol are expected to be the main alternative marine fuels in the next decade, according to founder of biofuel brokerage Motion Eco, Shutong Liu. But biomethanol is likely to grow in importance because of the limited supply of feedstock UCO, which will need to be shared across bio-bunkering, on-road and aviation fuel demand.
Chinese green methanol suppliers have announced more than 100 projects to produce over 30mn t/yr of green methanol, according to Liu. The planned projects comprise 12mn t/yr of biomethanol and 18mn t/yr of e-methanol capacity.
Energy, chemical engineering and food equipment firm CIMC Enric, for example, is constructing a biomethanol plant to produce 50,000 t/yr by the fourth quarter of 2025 in Zhanjiang in Guangdong with a planned capacity increase to 200,000 t/yr by 2027, said the company's director David Wang. The factory has 20,000t of storage capacity for biomethanol, Wang added. Chinese wind turbine supplier and biomethanol producer GoldWind will start up two 250,000 t/yr biomethanol plants, with one unit starting up by the end of 2025 and the other in late 2026, said the company's vice-president Chen Shi.
Biomethanol is produced by converting biomass into syngas through gasification, often with the addition of green hydrogen, before reacting with a catalyst to produce methanol.
E-methanol is produced by combining captured CO2 with green hydrogen, but is considered far less commercially viable than biomethanol because of higher production costs and less established technology.
Both alternatives can be blended with fossil methanol for marine fuel usage because of their identical molecular properties to the conventional fuel.
Money matters
Panellists said a slowing Chinese economy and high investment costs remain a barrier for suppliers to ramp up biomethanol production.
Securing long-term offtake agreements with reputable end-users is often needed to progress green fuel production projects at scale, said Swire's shipping and bulk chief sustainability officer, Susana Germino. Chinese biomethanol producers have also sought long-term offtake agreements with shipowners to move to final investment decisions (FID) on their projects, Chen said. GoldWind signed a long-term offtake agreement for biomethanol with Danish container shipper Maersk in 2023, and reached an FID on its biomethanol unit in Inner Mongolia the following year.
But pricing these contracts remains a challenge. Green methanol must benchmark against its main rival marine biodiesel to attract buyers, Liu said, despite its higher production costs. Even then, marine biofuels are often more attractive as they are operationally easier to bunker, he added.
