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LNG in the US

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For a long time DNV GL has been looking to LNG as a cost-effective solution to the challenges faced by the maritime industry – particularly challenges related to fuel cost and emissions.

For a long time DNV GL has been looking to LNG as a cost-effective solution to the challenges faced by the maritime industry – particularly challenges related to fuel cost and emissions. This pro-LNG approach, combined with the abundance of inexpensive natural gas in North America, has led to a surge in LNG-related activities. Shipowners in the US are already feeling the effects of tightened Emission Control Area (ECA) regulations. Next year, an increasingly strict sulphur emissions regulation will go into effect. LNG is an attractive fuel choice for many vessels, because it exceeds the air quality standards set forth in the North American Emission Control Area (ECA), and the price of LNG is significantly lower than ECA-compliant fuel. 
 
Several owners have committed to switching to LNG, in anticipation of the strictly limited emissions to air allowed under the North American Emission Control Area (ECA) requirements and Phase II of California’s Ocean Going Vessel (OGV) Clean Fuel Regulation. Two owners have already decided to work with DNV GL as they make their first forays into this new chapter of shipping. DNV GL has been asked by Crowley Maritime to provide classification services for its two new LNG-powered ConRo ships to be built at VT Halter Marine in Pascagoula, Mississippi. The ConRos will transport vehicles and containers between the US and Puerto Rico. 
 
The 219.5 meter long vessels will have space for 2400 TEU and 400 vehicles, and will meet the DNV GL Green Passport and CLEAN class notation environmental standards. Tucker Gilliam, Crowley’s Vice President of Special Projects, says the company was pleased with DNV GL’s expertise and professionalism during the project. “Over the past year and a half VT Halter Marine, Wärtsilä Ship Design, Crowley, and DNV GL have worked very hard to develop an evolutionary ship design that will yield a higher level of safety and environmental responsibility,” he says. “The name ‘Commitment Class’ was chosen to represent Crowley’s commitment to the Puerto Trade, but it is also a fitting tribute to the commitment from firms such as DNV GL, who helped us design and deliver a safer, smarter, greener class of ships.” Bill Skinner, CEO of VT Halter Marine added: “DNV GL has demonstrated that they have the knowledge and experience to ensure that our first LNG-powered vessel construction program will be a successful one,” he said. “DNV GL’s outstanding support during the construction of VT Halter Marine’s prior RO/RO and ConRo vessels ensured that they were the surveyors of choice for this programme.” 
 
Another shipowner, Matson, has also decided to construct two new Aloha class 3600TEU containerships at Aker Philadelphia Shipyard with DNV GL as its partner for classification. Designed for service between Hawaii and the West Coast, the 260.3 meter long vessels will be the largest containership constructed in the US and feature dual-fuel engines and hull forms optimised for energy efficient operations. “We are proud to have been chosen to support Matson and Crowley on these ground-breaking projects,” says Paal Johansen, Vice President and Regional Director Americas at DNV GL. “Their vision in taking this step forward will not only enhance their own competitiveness, but will prove valuable for the US shipping industry as a whole. 
 
This will also give the yards the opportunity to develop and showcase new competencies, while spurring infrastructure development around the country. Their customers will benefit from access to the latest generation of highly efficient ship designs.” DNV GL forms LNG solutions group in the Americas DNV GL has also established a Houston-based LNG Solutions Group – Americas. It offers deep LNG expertise, as well as extensive experience in business, risk and regulatory matters specific to the North American market. The LNG Ready service is also part of the service portfolio, offered by the DNV GL Advisory Service in Houston (see LNG Ready, page 12). “By drawing on our expertise from oil and gas we can offer an unrivalled set of capabilities, from major export or liquefaction projects to small-scale bunkering and everything in between,” says Bjørn-Harald Bangstein, Director of Operations Maritime Advisory for DNV GL Americas. “We are happy to see shipowners, yards, ports, bunkering operators, and LNG proponents well-positioned for LNG,” he says. 
 
Study for IMO MEPC 66 DNV GL was engaged by the International Maritime Organization (IMO) to study the feasibility of using LNG as a ship fuel for international shipping in the North American ECA. The study identified the necessary conditions for the successful implementation of LNG as a fuel source for shipping in the region. MARAD The US Department of Transportation’s Maritime Administration (MARAD) awarded DNV GL a contract to analyse the issues and challenges associated with LNG bunkering, and the landside infrastructure needed to store and distribute LNG. The study was delivered in spring 2014. Because the development of infrastructure is acutely dependent on the needs of specific ports and stakeholders, there is no one size fits all bunkering option for the USA. To address the key factors for the development of infrastructure at a port, four potential bunkering options were identified and evaluated: truck to ship, shore to ship, ship to ship, and portable tank transfer. The report concluded that the development and implementation of a regulatory approval process for LNG bunkering operations and associated facilities should include a Quantitative Risk Assessment (QRA) that utilizes probabilistic risk acceptance criteria to assess the acceptability of the risk posed. 
 
To promote safe LNG bunkering operations, the approval should also include completion of a port risk assessment at each port where LNG bunkering will likely take place. The development of a methodology for, and completion of a quantitative port-wide navigational risk assessment that determines how changes in traffic character and frequency/ density affect the safety and security of the public, workers, critical infrastructure, and commercial operations is essential. Effective security and safety zone enforcement procedures to promote a safe environment for the port population, is also necessary. Regulatory gaps were identified for LNG metrology, local vs. federal jurisdiction over bunkering operations, and a lack of framework for the review of potential risks related to LNG bunkering from non-self-propelled barges. There is a need for greater clarity in regulations addressing simultaneous operations (SIMOPS). Proper training for crew and operators involved with LNG bunkering operations is critical for the establishment and maintenance of safe practices. 
 
The report provides a training scheme for crew and first responders that addresses basic, advanced, and site-specific recommended practices. The Houston-based group of LNG experts has been communicating frequently with regulatory bodies, including the US Coast Guard, in an effort to understand and help ensure compliance with new US regulations. “Through our interfaces with the US Coast Guard, we know that they are now finalizing the remaining regulatory requirements on a detailed level,” Bangstein says. “They are doing so in an open and consultative manner that involves the industry and prevents surprises and misunderstandings. Naturally, there could be additional state, county, and municipal regulations. But with a national regulatory framework designed to prevent major hazards using a risk-based approach, local variations can be addressed through risk assessments, allowing for a consistent and predictable national regulatory framework.” 