Oil major Royal Dutch Shell has agreed to charter six 174,000-cubic-metre liquefied natural gas (LNG) carriers after entering into agreements with ICBC Financial Leasing, Korea Line Corporation and Knutsen LNG, as well as a group of institutional investors being counselled by JP Morgan Asset Management.
Hyundai Samho Heavy Industries and Hyundai Heavy Industries will build the new vessels, which will be gradually integrated into the time-chartered trading fleet at Shell, starting from the middle of 2023. They will feature a number of efficiency features to reduce emissions, such as dual-fuel X-DF engines, which can burn cleaner LNG as fuel when available but switch to diesel when necessary. Air lubrication systems, meanwhile, will help to reduce fuel consumption by reducing the drag on the hull. The vessels will also have plants to manage the boil-off gas from the LNG tanks.
Shell Shipping & Maritime’s head, Grahaeme Henderson, said about the new vessels:
“These ships will deliver a 60% reduction in carbon emissions compared to 2004 steam turbine LNG carriers. Shell’s ambition is to be a net-zero emissions energy business by 2050 or sooner and highly efficient ships like these are one of the ways that we are reducing emissions in our operations.”
He added that as they work towards developing zero-carbon fuels that can be produced at scale, Shell, which also makes lubricant products, believes that LNG will have an interim role to play in delivering a cleaner supply chain for the world.