INTERVIEW: 85% of ship engines ordered in 2030 likely to be dual-fueled: MAN Singapore

MAN Energy Solutions expects the order book for dual-fuel engines to ratchet, with around 85% of all ship engines ordered in 2030 to be dual-powered, as the global shipping industry speeds up maritime decarbonization efforts, its Singapore Managing Director Nicolas Brabeck said.

The 2030 estimates compare to just around 35% dual-fuel engines ordered in 2021 and 56% in 2022, Brabeck told S&P Global Commodity Insights in an interview.

"All our engines which can run on alternative fuels are dual fuel. We have engines for methane, ethane, LPG, methanol and soon ammonia," Brabeck said.

"The industry is segmented and there are pro/cons about all fuels and its subject to vessel type and size, involved parties etc," Brabeck added, hinting at a multi-fuel future for shipping as it grapples to comply with various environmental regulations including the EU ETS, which is set to boost the uptake of green fuels.

The lack of adequate fuel availability and actual main engines for ammonia and hydrogen dual-fueled vessels being built in the shipyards means that LNG and biofuels, as well as methanol, are the main candidates to fill the slots until the new fuels are tested and more prevalent, analysts at S&P Global said in a recent report.

According to S&P Global's reference case, the overall bunker fuel demand in 2030 will likely be 328 million mt, with LNG set to occupy a 7.8% share in the total mix and all alternative fuels excluding LNG and LPG set to hold a 2.2% share.

Navigating a multi-fuel future

MAN, for its part, is already developing a fuel-flexible, two-stroke ammonia engine as a key technology in the maritime energy transition.

According to its website, the company aims to have a commercially available two-stroke ammonia engine as early as this year, followed by a retrofit package for the gradual rebuild of existing maritime vessels by 2025.

Meanwhile, in December 2023, MAN Energy Solutions inked a deal with China's COSCO for methanol retrofits.

MAN has over 180 of its methanol engines ordered so far by various shipowners and operators globally, Brabeck shared. Meanwhile, the total number of methanol powered ships with the company's ME-LGIM engines ordered in China is around 105, he added, reflecting the growing popularity of methanol as a marine fuel.

MAN Energy also recently announced a Dual-Fuel Methanol Agreement with China Classification Society.

"The MAN B&W ME-LGIA apply the same double wall concept as our existing LGI based dual-fuel engines. This means that leakages will be contained within a double wall concept so no direct leakages to engine room will occur," Brabeck said.

He clarified that the company was not considering investing in green methanol companies nor producers. It will, however, supply crucial components for e-methanol facilities.

When it came to LNG as a marine fuel, Brabeck noted that LNG was both a transition fuel as well as a fuel in transition.

"LNG is the fossil variant of methane, and it has limited potential in regards to meeting IMO emission reductions. However, LNG-fueled engines can also run on bio-methane or synthetic natural gas," Brabeck said.

The MAN B&W ME-GI two-stroke dual fuel engine is among the most efficient in the market and provides a future-solution to LNG powered ships as it has negligible methane slip emissions, Brabeck said.

The emissions are several times lower than competing Otto cycle engine, he added.

Meanwhile, Brabeck remained confident that the demand for LNG powered engines was set to stay robust despite volatile gas markets.

"Fuel prices are exposed to cycles, but engine contracting is not exposed to the short-term price of LNG," Brabeck said.

MAN's Singapore foray

Singapore, the world's largest bunkering port, has been at the helm of various initiatives to promote sustainable shipping.

On March 1, MAN unveiled its new mixed-purpose facility at the city-port, with the facility also being the largest service hub outside of Europe.

"The opening of MAN Energy Solutions' new mixed-purpose facility will expand local business activities," Brabeck said.

The facility offers maintenance and repair services for users of its alternative fuel two-stroke engines, and can also provide faster access to spare parts to reduce turnaround time for ships at the trans-shipment hub.