ADNOC Logistics & Services, a wholly-owned subsidiary of UAE’s ADNOC, said Wednesday that it had signed an agreement with Japan’s Inpex to collaborate on LNG bunkering activities.
Under the framework agreement, the companies will explore opportunities for LNG bunkering in the UAE as well as the potential to jointly expand LNG bunkering activities to cover other regions, including Southeast Asia, it said in a statement.
“Our goal, through this partnership, is to offer safe and efficient LNG fueling solutions to our customers,” Abdulkareem al-Masabi, CEO of ADNOC L&S said.
The accelerated move towards LNG bunkering comes at a time when LNG as a marine fuel is gaining increased momentum due to upcoming environmental rules in shipping worldwide.
The International Maritime Organization will cap global sulfur content in marine fuels at 0.5% starting January 1, 2020, from 3.5% currently. This applies outside the designated emission control areas where the limit is already 0.1%.
In April, the IMO’s Marine Environment Protection Committee agreed to an initial strategy to cut the shipping industry’s total greenhouse gas emissions by at least 50% from 2008 levels by 2050.
Most LNG variants have no detectable sulfur, and emission of particles and nitrogen oxide by LNG-fueled vessels are considerably lower than by ships using other marine fuels. It also helps tackle greenhouse gas emissions.
Due to upcoming rules, availability and expectations of favorable pricing economics, LNG’s adoption as a marine fuel is expected to be high, with some industry sources expecting it to account for over 10% share of the global marine fuel mix by 2030.
The agreement between ADNOC and Inpex is also in line with Inpex’s 2040 vision for the company.
“As outlined in VISION 2040, our long-term corporate vision, we will look to develop gas demand in Asia and other growing markets. LNG bunkering will be a key component to the creation of natural gas demand,” Inpex said.
ADNOC and Inpex have also partnered in the past in the Umm Shaif and the Lower Zakum fields, within the former Abu Dhabi Marine Areas, or ADMA, concession.
Inpex joined in the development of three other offshore oil fields: Upper Zakum field in 1977, Umm Al Dalkh in 1978 and Satah in 1980, ADNOC said.
In February, ADNOC awarded Inpex a participating interest in the Lower Zakum offshore concession, as well as a 25-year extension of the Satah and Umm Al Dalkh offshore concession.
Source: Hellenic Shipping News.