Natural gas as a fuel for ships and shore-side operations: Commissioner Doyle hosts roundtable discussion with industry and government officials

On June 4, 2015, Commissioner William P. Doyle of the Federal Maritime Commission held a roundtable discussion at the suggestion of the Natural Gas Supply Association (NGSA). Commissioner Richard A. Lidinsky, Jr. joined Commissioner Doyle in welcoming the industry and government participants. Focusing on the topic of liquified natural gas as a marine fuel, Commissioner Doyle brought together a range of key government officials and industry stakeholders across the maritime, energy, transportation sectors. The meeting began with a presentation by NGSA Chairman Bill Green of Devon Energy, who discussed the natural gas production and supply market. He was interested in learning more about the emerging “new market” for natural gas in the maritime industry. The floor was then opened to all attendees to discuss issues regarding the use of liquefied natural gas (LNG) as a marine fuel.

The forum highlighted the substantial progress made by U.S.-based marine operators Harvey Gulf Marine, Totem Ocean Trailer Express, and Crowley Maritime who are transitioning to fueling their vessels with LNG. For U.S. operators, these retrofits and new builds take place exclusively in U.S. shipyards. International ocean carriers United Arab Shipping Company and Wallenius Wilhelmsen shared their deep-sea perspective on the choice of fuels. Wallenius Wilhelmsen heads up the Trident Alliance while United Arab Shipping Company has ordered seventeen LNG- ready vessels scheduled to be fully delivered by 2016, including one 14,000 TEU container ship, ten 15,000 TEU container ships and six 18,000+ TEU container vessels. Energy companies Sempra and Shell noted that natural gas will continue to become an important part of the global gas supply and called for continual infrastructure development. LNG America, a future natural gas bunker supplier, and design and service providers WesPac Midstream and Buffalo Marine Services, concurred that the LNG marine fuel/bunkering markets have room to grow.

Port authorities from Philadelphia, Jacksonville and New York/New Jersey also attended and commented that beneficial cargo owners are asking about sustainability. As a result, port authorities are looking at LNG as both a marine fuel and for shore-side operations, including drayage trucks and cargo handling machinery. The port authorities’ presence highlighted the important role that ports will continue to play as natural gas projects continue to expand. Government attendees included representatives from the U.S Department of Transportation, the U.S. Maritime Administration, U.S. Coast Guard, U.S. State Department and the Texas Department of Transportation.

Commissioner Doyle stated, “LNG bunkering is a potential market for America’s natural gas resources. The Federal Maritime Commission’s mission is to foster a fair, efficient and reliable international ocean transportation system. By bringing elements of the maritime industry together with the energy sector, we are beginning a long-term dialogue that should culminate in greater understanding and use of domestic natural gas that is cost-efficient and with significant environmental compliance benefits.”

Commissioner Lidinsky (center) added levity to the important discussions. Commission Doyle is to the right of Commissioner Lidinsky, David Tubman, counsel to Commissioner Doyle, is to the left.

Roundtable participants listen attentively to Bill Green present the 2015 Summer Outlook on domestic natural gas.