18/12/24
Viewpoint: Japan eyes methanol as marine bridging fuel
Tokyo, 18 December (Argus) — Japanese demand for methanol as an alternative
marine fuel is expected to increase, especially after 2027, but it is likely it
will mainly be used as a transition fuel before the commercial launch of
ammonia- and hydrogen-fuelled vessels. The Japanese shipping industry is
expected to launch more methanol-fuelled vessels from 2027 ( see table ), to
help reduce greenhouse gas (GHG) emissions from the global maritime sector.
Global regulatory body the International Maritime Organization (IMO) in 2023
pledged to achieve net zero emissions in international waters by or around 2050.
To help achieve the IMO's target, a total of 26 methanol-powered vessels are
expected to be commissioned worldwide by the end of this year, followed by 54
ships in 2025 and 96 carriers in 2026, according to a report released in
November by Japanese classification society ClassNK. This would increase global
methanol demand to 4.5mn t/yr by 2026, said the report. As of June, there are 33
methanol-fuelled vessels currently in use. Methanol-fuelled vessels can refuel
at around 130 major ports all over the world, except in Japan, according to
Japanese shipowner Mitsui OSK Lines (Mol). The city of Yokohama in the eastern
prefecture of Kanagawa, in co-operation with Mitsubishi Gas Chemical (MGC) and
Maersk, launched a study on methanol and green methanol bunkering in the port of
Yokohama in December 2023. Since then, the group, in collaboration with new
partners — Japanese refiner Idemitsu, MGC's shipping subsidiary Kokuka Sangyo,
domestic shipping firm Uyeno Transtech and Yokohama Kawasaki international port
— has conducted a ship-to-ship bunkering simulation at the port of Yokohama in
September. Expectations of the increase in methanol use, especially cleaner
e-methanol, have led Japanese firms to become more involved in upstream projects
to secure the fuel. Japanese firms have invested in more than 10 e-methanol
production projects both in and outside of Japan ( see table ), with the number
of projects likely to increase, according to the ministry of economy, trade and
industry. Japanese firms are developing new carriers, but at the same time are
also trying to modify existing vessels — which currently use fuel oil, LNG, LPG
and methanol — to be able to burn renewable fuels such as biofuels, e-methane
and e-methanol. It would be easy to increase the number of methanol-fuelled
ships, given their relatively low initial or modification costs compared with
LNG-fed vessels, according to Mol. Methanol is also a stable liquid at room
temperature and atmosphere pressure, making it easy to transport and store
compared to other alternative fuels, Mol added. Fellow shipping company Nippon
Yusen Kaisha (NYK line) is also mulling the development of smaller
methanol-fuelled handymax ships that are unable to be equipped with large
ammonia fuel tanks, to aid with decarbonisation. Methanol a temporary solution
But Japanese firms see methanol mostly as a "bridging fuel" rather than a
zero-emission fuel, as methanol can reduce GHG emissions only by 15pc compared
to traditional bunker fuel, although it can curb sulphur oxide and nitrogen
oxide emissions by up to 99pc and 80pc, respectively. It would be vital to begin
introducing much cleaner marine fuels, such as ammonia and hydrogen, to meet the
maritime sector's net-zero goal. Tokyo is trying to promote the development of
ammonia and hydrogen-fuelled ships by providing financial support, while the
utilisation of such clean vessels could materialise from around 2030, the
ministry of land, infrastructure, transport and tourism (Mlit) said. Japan's
state-owned research institute Nedo plans to provide ¥35bn ($229mn) to support
the development of engines, fuel tanks, fuel supply systems and other core
technologies for zero-emission ships that use hydrogen and ammonia, as well as
LNG and e-methane, under its ¥2.76 trillion green innovation fund. But the
grants are much larger than those for the development of methanol-fuelled ships,
which are currently available only from Mlit and the environment ministry, with
the amount of ¥100mn per vessel over two to three years. The scheme has been
open for application every year since 2023. But the ministries' scheme also
targets LNG-fuelled ships, with a breakdown of allotment for methanol-powered
vessels unclear. By Reina Maeda and Nanami Oki Japanese firms' methanol projects
Methanol-fuelled ships Company # of vessel Type Target commercialisation
Announcement Mitsubishi Gas Chemical, Mitsui OSK Line 1 Ocean-going methanol
carrier Jul-05 May-23 Toyofuji Shipping, Mitsubishi Heavy Industries 2 Ro-Ro
vessel 2027-28 fiscal year Jun-24 Mitsui OSK Line 1 Coastal methanol carrier
Dec-24 Jul-24 NS United Kaiun, Nihon Shipyard, Jaman Marine United, Imabari
Shipbuilding Multiple Bulk carrier After 2027-28 fiscal year May-24 Orix,
Tsuneishi Shipbuilding 2 Bulk carrier Jul-24 Production Company Product Country
Target commercialisation Target capacity (t/yr) Mitsui E-methanol US Jan-24
1630000 Mitsubishi Gas Chemical Bio-methanol Japan Jun-24 Small amount
Mitsubishi Gas Chemical, Kobelco E-methanol Japan NA NA Cosmo, Toyo Engineering
E-methanol Japan NA NA Sumitomo Chemical E-methanol Japan 2030s NA Mitsui, Asahi
Kasei Bio-methanol US Jun-23 NA Toyo Engineering E-methanol India 2030 NA
Investment Company Product Country Target commercialisation Target capacity
(t/yr) Mitsui E-methanol Denmark NA 42,000 Idemitsu E-methanol Brazil, US,
Chile, Uruguay, Australia 2,030 4,000,000 JOGMEC E-methanol Brazil, US, Chile,
Uruguay, Australia 2,030 4,000,000 Mitsu OSK Line E-methanol Brazil, US, Chile,
Uruguay, Australia 2,030 4,000,000 Table source: Firm's company releases Send
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