Introduction to LNG Fueled Cargo Vessels and Bunkering Issues

Introduction to LNG Fueled Cargo Vessels and Bunkering Issues Raffaele Piciocchi ABS LNG Center - Greece Limassol 9 October 2012 CYPRUS SHIPPING FORUM

Outline Background and Key Drivers Regulatory Framework Requirements and Arrangements Fuel Containment Systems Fuel Storage Location NBOG Management Double Wall Piping Concept Fuel Gas Supply Bunker Station Prime Movers Further Considerations 2

Outline Background and Key Drivers 3

Background & Drivers Emission Control Area (ECA) 4

Background & Key Drivers Fuel and gas prices US shale gas 5

Background & Key Drivers In recent years dual fuel engine technology has been introduced to the marine market, primarily through medium speed engine applications to LNG carriers Spark ignition gas engines have also been installed on a number of ferry and patrol craft vessels primarily operating in Norway Rolls Royce Bergen C26:33, source Rolls Royce Mitsubishi GS16R-MPTK, source Diesel Power Wartsila 50DF, source Wartsila 6

Outline Background and Key Drivers Regulatory Framework 7

Regulatory Framework IMO Interim Guidelines on Safety for Natural Gas-Fueled Engine Installations in Ships (IMO Res. MSC.285(86)) IMO International Code for Safety for Ships Using Gases or Other Low Flashpoint Fuels (IGF Code) International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (IGC Code) ABS Guide for Propulsion Systems for Gas Carriers ABS Guide for Propulsion and Auxiliary Systems for Gas Fueled Ships Additional requirements may be imposed by Flag Administrations 8

Regulatory Framework: IMO IMO Resolution MSC.285(86) Interim Guidelines on Safety for Natural Gas-Fueled Engine Installations in Ships adopted 1 June 2009 voluntary IMO International Code for Safety for Ships using Gases or Other Low Flashpoint Fuels (IGF Code) originally scheduled for completion in 2012, BLG 15 in Feb 2011 extended that to 2014 Needs to be mandated by SOLAS Needs to be reviewed by other IMO bodies, DE, FP, SLF, STW 9

Regulatory Framework: IMO BLG 16 at IMO 30 Jan. 3 Feb. 2012 SIGTTO submitted BLG 16/6/7 with a number of concerns, including Location of bunker tanks ESD protected machinery spaces BLG decided LNG tanks can be located below accommodation areas risk-based analysis No power limit to ESD machinery spaces Focus on natural gas but requirements for other gases included Portable LNG storage tanks permitted Training and other sections to be reviewed by STW, FP, SLF and DE for guidance 10

Regulatory Framework: Class Rules ABS Steel Vessel Rules IACS Unified Requirements M59 Control and Safety Systems for Dual Fuel Diesel Engines PM6902 Unified Requirement Safety of Diesel Engines Supplied with Low Pressure Gas 11

Regulatory Framework: Environment IMO Annex VI EU Gaseous emissions GHG Sulfur Directive 1999/32/EC as amended CARB Oceangoing vessel (OSV) Fuel Regulation EPA 40 CFRs 12

SOx Regulations Regulation Coverage Application Date S% Comments MARPOL Annex VI Global Current 3.5 Global 01-Jan-20 0.5 Review by 2018 SECA Until 30 June 2010 1.5 Baltic/North Sea/English Channel SECA 01-Jul-10 1.0 Baltic/North Sea/English Channel US/Canada ECA 01-Aug-12 1.0 Adopted MEPC.190(60) US Caribbean Waters 01-Jan-14 1.0 Adopted MEPC.202(62) EU Directive 1999/32/EC SECA /ECA 01-Jan-15 0.1 Baltic/North Sea/English Channel/US/Canada/US Caribbean Waters EU ports at berth and at anchor 01-Jan-10 0.1 Final legal proposal for amendment in progress CARB California waters 01-Jul-09 1.5 0.5 Marine Gas Oil (ISO 8217 DMA Grade) Marine Diesel Oil (ISO 8217, DMB Grade) California waters 01-Aug-12 1.0 0.5 Marine Gas Oil (ISO 8217 DMA/DMZ Grade) Marine Diesel Oil (ISO 8217, DMB Grade) California waters 01-Jan-14 0.1 Marine Gas Oil (ISO 8217 DMA/DMZ Grade) Marine Diesel Oil (ISO 8217, DMB Grade) 13

SOx Regulations IMO Annex VI Regulation 14 2.4% average sulfur content MEPC 61/4 14

NOx Regulations Global: IMO Annex VI Regulation 13 Local: IMO Annex VI Regulation 13, Tier III ECA Local: e.g. EPA 40 CFRs 92 & 94 + HC, CO, PM E.g. Category 1 & 2 engines over 2,000 kw, 2.0g/kWh NOx + HC from 2014 EPA Tier 4 Tier 4 Standards for Marine Diesel Category 1/2 Engines Power (P) NOx HC PM Date kw g/kwh g/kwh g/kwh P 3700 1.8 0.19 0.12 a 2014 c 1.8 0.19 0.06 2016 b,c 2000 P < 3700 1.8 0.19 0.04 2014 c,d 1400 P < 2000 1.8 0.19 0.04 2016 c 600 P < 1400 1.8 0.19 0.04 2017 d a - 0.25 g/kwh for engines with 15-30 dm 3 /cylinder displacement. b - Optional compliance start dates can be used within these model years. c - Option for Cat. 2: Tier 3 PM/NOx+HC at 0.14/7.8 g/kwh in 2012, and Tier 4 in 2015. d - The Tier 3 PM standards continue to apply for these engines in model years 2014 and 2015 only. 15

United States Coast Guard (USCG) USCG issued a policy letter on equivalency determination on 19 April 2012 USCG accepts the use of IMO MSC.285(86) Interim Guidelines subject to additional requirements For US flag vessels, USCG will likely require plan review of gas-fueled propulsion systems, even when vessels are enrolled in the Alternative Compliance Program USCG have stated acceptance of gas storage tanks under accommodation requires special approval of the Commandant 16

ABS Dual Fuel Publication History ABS published guidance on the application of dual fuel diesel engines with the ABS Guide for Design and Installation of Dual Fuel Engines in Jan. 2003 This was superseded by the ABS Guide for Propulsion Systems for LNG Carriers in Sept. 2005 Now supplemented for other vessel types by the ABS Guide for Propulsion and Auxiliary Systems for Gas Fueled Ships published in May 2011 17

Outline Background and Key Drivers Regulatory Framework Requirements and Arrangements 18

Outline ABS Guide Layout and Requirements Fuel Tank Requirements, Types and Location 19

Fuel Tank Requirements, Types & Location The key safety objectives of the IGC Code and the means by which these are achieved have been incorporated in the ABS Guide to mitigate Risk of fire in adjacent space causing over pressure Risk of leaked flammable product causing fire/explosion Risk of leaked cryogenic fluid leading to loss of structural integrity Risk of fire in adjacent space causing over pressure Hold spaces segregated from spaces containing source of ignition Cargo area forward of Category A machinery spaces Segregated from source of ignition by a cofferdam ESD system 20

Fuel Tank Requirements, Types & Location Risk of leaked flammable product causing fire/explosion Segregated from source of ignition Area classification (hazardous zones) Gas detection systems Inert cargo holds for Type A and means to quickly inert for Type B Risk of leaked cryogenic fluid leading to loss of structural integrity Separation from bottom/side shell Double hull in way of fuel storage Full secondary barrier Leak before failure concept with partial secondary barrier and small leak protection system Gas detection Temperature detection 21

Fuel Tank Requirements, Types & Location Fuel containment systems including pressure tanks, independent gravity tanks and membrane tanks designed in accordance with IGC Code, as incorporated in 5C-8-4 of the SVR, are permitted Type C independent tanks No secondary barrier Robust design Higher design pressures Easy installation Can be installed on open deck 22

Fuel Tank Requirements, Types & Location Membrane Tanks Effectively utilize available space Require full or partial secondary barriers sloshing loads can be an issue Prismatic Tanks Effectively utilize available space Require full or partial secondary barriers Type B tanks are arranged for inert gas pressurization of hold spaces, with secondary barriers and hull protection in accordance with IGC Code principles 23

Fuel Tank Requirements, Types & Location LNG approximately 1.6 x volume of HFO and CNG approximately 4 x volume of HFO Real world volume requirement for small Type C LNG fuel storage tank and FGS system 4 x HFO 24

Fuel Tank Requirements, Types & Location Fuel storage tank location to be B/5 from sideshell as per IGC Code Type 1G ship For ships other than passenger vessels, the revised IGC Code tank location criteria for Type 2G and 2PG ships may be applied 25

Fuel Tank Requirements, Types & Location Tanks under accommodation? One view...solas establishes the fact that the accommodation cannot be located above the (LNG) fuel tank/containment system... Another view: whether or not the tank is under accommodation is not causing additional risk to the tank with regard to external impacts or fire loads as long as the risks of damaging the tank are kept very low a location under accommodation will not make a change to the risk picture 26

Fuel Tank Requirements, Types & Location LNG fuel tanks under accommodation? IMO BLG 16 has agreed that this would be permitted Risk based approach to be applied IMO to undertake further assessment of collision data to determine equivalency with existing prescriptive requirements on LNG tank distance from sideshell Source: NOF 27

Outline ABS Guide Layout and Requirements Ship Arrangements Fuel Tank Requirements, Types and Location NBOG Management 28

NBOG Management means are to be provided to maintain tank pressure below MARVS by safely utilizing or disposing of NBOG at all times, while in port, while maneuvering, while standing by... One or more of combination Dual fuel diesel plant for propulsion and power generation Single gas fuel engine plant for propulsion and power generation A gas turbine plant for propulsion and power generation A re-liquefaction system A gas combustion unit Other approved consumer such as auxiliary steam boiler Pressure accumulation Cold ironing requirements to prevent operation of auxiliary diesels in port? 29

NBOG Management maintain tank pressure below MARVS and not to become liquid full for a period of 15 days Type C tank has higher pressure capability Larger vessels using low pressure tanks will also need GCU, re-liquefaction or boiler/steam dump 30

Double Wall Fuel Gas Piping Machinery Space Double wall pipe with annular space pressurized with inert gas at pressure higher than fuel gas pressure. Loss of pressure alarm and activate ESD. Installed within a ventilated pipe or duct with negative pressure, gas detection or loss of ventilation activate ESD Provision for inerting and gas freeing piping in engine room Master gas valve outside the machinery space Continuous gas detection in any fuel gas utilization space Independent ventilation for machinery space High pressure internal combustion engines must be double walled 32

Double Wall Fuel Gas Piping Machinery Space Vent Exhaust Ventilation 30 A/C Vent Ventilation Gas detectors GVU room Master gas valve Gas fuel Double wall gas pipes ** Double wall gas pipes may be sealed inert gas pressurized type Duct ventilation inlet or from external location DFD or gas engine Non-hazardous machinery space 33

Single Wall Fuel Gas Piping Concept Low pressure gas systems (< 10 bar) only Two separate machinery spaces are to be provided Spaces to contain only engines and minimum necessary equipment Space to be as small in volume as practicable Two independent gas monitoring systems. Locations of gas detectors to be verified by smoke tests or gas dispersion analysis. Alarm upon gas detection at 20% LEL Upon gas detection (40% LEL), shut-off gas supply and shutdown the machinery space Source: Mitsubishi 35

Single Wall Fuel Gas Piping Concept 36

Outline ABS Guide Layout and Requirements Ship Arrangements Fuel Tank Requirements, Types and Location NBOG Management Tank Connection Space and Room Requirements GVU Requirements Double Wall Fuel Gas Piping Machinery Space Single Wall Fuel Gas Piping Concept Fuel Preparation and Supply Piping and Purging Requirements Bunker Station Requirements 37

Bunker Station Requirements No gas is to be discharged to air during bunkering operations Key bunker station requirements Sufficient natural ventilation Physical separation and structural protection Stainless steel drip trays Class A-60 protection Remote control and monitoring Manual and remote ESD valves Draining/purging/inerting provision Ventilation and gas detection of bunkering lines Stop valve and ESD valve LNG SUPPLY VAPOR RETURN COMM LINK/ESD CONTROL STATION Gas detection and ventilation for enclosed or semi enclosed station BONDING CONNECTION Drip trays and means of drainage to be provided 38

Bunker Station Requirements ABS Guide Section 4 Fuel Bunkering System The Guidelines for systems and installations for supply of LNG as fuel to ships is under development under ISO TC67 WG10 Target is to standardize the interface between the ship and the fuel supply facilities, to ensure that a LNG fuelled ship can refuel in any port with LNG fuel supply facilities... SIGTTO have published STS guidelines 39

Prime Mover Requirements & Options DF Diesel Electric: four-stroke medium speed dual fuel diesel DF Direct Drive: four-stroke medium speed dual fuel diesel MAN B&W ME-GI engine: dual fuel two stroke slow speed diesel direct drive Spark (or micro pilot) ignited gas only engine: four-stroke medium and high speed gas engines Electric drive Direct drive Gas turbine 41

Prime Mover Requirements & Options Low pressure systems according to Otto cycle Pre-mixed Port injection Lean burn Pilot injection Spark ignition Micro pilot High pressure systems according to Diesel cycle Direct injection Dual Fuel Diesel Engine is a diesel engine that can burn natural gas as fuel simultaneously with liquid (pilot) fuel and also have the capability of running on liquid fuel only Single Gas Fuel Engine is an engine capable of operating on gas fuel only (100%MCR) 42

Prime Mover Requirements Explosion protection for air and exhaust manifolds Means to sample crankcase gas concentration and means of inerting Crankcase oil mist detection Exhaust system purge capability Combustion monitoring knock sensor No gas admission without pilot injection or spark ignition Rapid (emergency) changeover gas to fuel (DF) Start and stop on diesel (DF) Source: MAN SE 43

Outline Background and Key Drivers Regulatory Framework Requirements and Arrangements Further Considerations 44

Further Considerations: Emissions Otto cycle DF and single gas fuel engines meet IMO Tier III NOx 24% NOx reduction for direct injection slow speed engines 45

Gas Fueled Engine: GHG Performance Gross Calorific Values HFO 41.2 MJ/Kg LNG 55.5 MJ/Kg And CO 2 -Kg/Fuel-Kg Conversion Factor HFO 3.11 LNG 2.75 Gross Calorific Values HFO 41.2 MJ/Kg LNG 55.5 MJ/Kg And Density HFO 991 Kg/m3 LNG 464 Kg/m 3 For the same energy input, LNG produce 35% less CO 2 than HFO does Possibly more opportunity for optimizing EEDI Potential to Improve EEOI Satisfy international and regional Sox emission regulations For the same energy input, LNG need 1.6 times more space to store Tankers: no penalty by on-deck storage Container ships: less cargo carrying capacity Type-B LNG tank Will be most space Efficient 46

Further Considerations DF medium speed engine (ECA) LNG = SOx + NOx Tier III MGO + SCR = SOx + NOx Tier III HFO + Scrubber + SCR = SOx + NOx Tier III? DF medium speed engine (non-eca) LNG = SOx + NOx Tier III MGO / HFO = SOx + NOx Tier II Single gas fuel Otto cycle engine (ECA and non-eca) LNG = SOx + NOx Tier III 47

Further Considerations Slow speed ME-GI DF engine (ECA) LNG + EGR = SOx + NOx Tier III MGO + EGR = SOx + NOx Tier III Slow speed ME-GI DF engine (non-eca) LNG = SOx + NOx Tier II MGO / HFO = SOx + NOx Tier II Selective Catalytic Reduction (SCR) Exhaust Gas Recirculation (EGR) 48

Further Considerations Low load considerations Fuel, on-engine and aftertreatment choices for SOx and NOx compliance outside and inside ECA s We can expect ECA and non-eca electronic engine control settings Fuel switching procedures and record book, SOx emission compliance plan, on board NOx verification procedure Source: MAN B&W 49

Further Considerations Availability of LNG fueling terminals Ship-to-ship transfer Sufficient storage space Emissions Local regulations GHG methane slip Gas spec methane number Transient response Crew training 50