X-Press Feeders plans to use green methanol for ships in Europe in Q2 2024
(Reuters) - Singapore-based container shipper X-Press Feeders plans to use green methanol bunker to fuel part of its fleet in Europe in the second quarter of 2024, a senior executive said on Tuesday.
The move comes as the European Union will extend its Emissions Trading System (ETS) next year to cover carbon dioxide emissions for all ships of 5,000 gross tonnage and above entering EU ports.
Shippers can buy carbon credits to offset emissions or burn lower-carbon fuels such as methanol and biofuels, although supply of these fuels is limited. Container giant AP Moller Maersk has also ramped up orders of methanol-powered ships over the past year.
X-Press Feeders, which operates more than 100 vessels globally, has ordered 14 dual-fuel ships that can burn methanol and conventional bunker fuel.
The first such vessel, Chinese-built Eco Maestro, is expected to sail from Shanghai to Rotterdam via the Suez Canal, refueling with green methanol supplied by OCI Global at key bunker ports along the way, said Francis Goh, chief operating officer at X-Press Feeders.
The company will receive eight vessels in 2024, while the remaining six will be delivered in 2025-2026, he said.
These ships will ply routes from Rotterdam to ports in Scandinavia and the Baltic states, Goh said.
"For a start, we will deploy them in Europe, and in a few years' time, we see deployment potential for them in other countries, maybe in the Americas, where we also have significant presence," he added.
Using green methanol, which is produced from biomass or captured carbon and hydrogen from renewable power, can reduce carbon dioxide emissions for its ships by 65% compared with conventional fuels, Goh said, adding that securing sufficient supply is a challenge.
The company has a term contract with green methanol supplier OCI Global from 2024, and is in talks with other western producers to secure more supplies, he said.
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