Lloyd’s Register does not believe in LNG as replacement for heavy fuel

Lloyd’s Register believes that it will be a long time before LNG catches on as fuel, and not necessarily as a straight replacement for oil, says the company in a new report.

Photo: Hanjin

Lloyd’s Register has recently released the study “LNG fuelled deep-sea shipping – Outlook for LNG bunker and fuelled newbuilding demand up to 2025,” which concludes, among other things, that there will be a market LNG fuel, but that the potential will be limited. The study found that the widespread adoption of LNG as fuel will be driven by price, the growth of alternative fuels and the degree of global collaboration. Its base case scenario predicted that, by 2025, there could be 653 deep-sea, LNG-fuelled ships in service, consuming 24 million tonnes of LNG annually. These ships are most likely to be containerships, cruise vessels or oil tankers.

When the study projected relatively cheap LNG - for example, priced at 25 percent lower than current market prices - the predicted number of LNG-fuelled ships tripled to approximately 1,960 units in 2025. If the cost of LNG increased 25 percent against current prices, hardly any new LNG-powered tonnage was projected to hit the water. However, Lloyd’s Register does not believe that LNG will replace fuel in general:

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