INTEGRATED LNG VALUE CHAIN

IN THE BALTIC SEA REGION :

CASE OF GoLNG Project
Asst. Prof. Lawrence Henesey1 & Dr. Laima Gerlitz2

1Blekinge Institute of Technology,,Karlshamn, Sweden

2Wismar University of Applied Sciences , Wismar, Germany

LNG as Future Marine Fuel: Trends and Challenges 3rd April 2019
Shanghai Maritime University (SMU), China
 ’
Karlshamn

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GO LNG Project

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Organisation Launched – Launched –

April 2017 April 2017

BSR Blue corridor BSR LNG Business BSR LNG competence

strategy Cluster center

Integrated LNGchain
Integrated value Value Functioning business Training programs
Chain
study network

LNG fuel distribution Training & research

strategy R&D infrastructure
Sweden, Norway, Spain, the
LNG Standard and Netherlands
regulation toolbox Study visits Service package

LNG shipping index B To B meetings Network of training

institutions
Business plans and
LBG business concept pilot projects
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Bringing LNG out of the “Dark Side”

WWW.GOLNG.EU
…Or attend a GO LNG meeting to see how
misinformed people are?

WWW.GOLNG.EU
 What is LNG?

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LNG – Governance & Regulation Drive – MARPOL VI

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 LNG – Effects of MARPOL VI

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 LNG – Effects of EU Policy
 The EU White Paper for Transport (2011) has set a greenhouse gas
reduction goal of at least 40% by 2050.
 GHG emissions reduction from transport of 60% by 2050.
Measure Coverage Timing
Electricity in urban/suburban and other densely Appropriate number of publically by end 2020
populated areas accessible points
CNG in urban/suburban and other densely populated Appropriate number of points by end 2020
areas
CNG along the TEN-T core network Appropriate number of points by end 2025
Electricity at shore-side Ports of the TEN-T core network and by end 2025
other ports
Hydrogen in the Member States who choose to Appropriate number of points by end 2025
develop it
LNG at maritime ports Ports of the TEN-T core network by end 2025
LNG at inland ports Ports of the TEN-T core network by end 2030
LNG for heavy-duty vehicles Appropriate number of points along by end 2025
the TEN-T core network
Along the TEN-T refuelling stations are installed AnLNG truck has an autonomy of about by 2020
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every 400 km 800–900 k
 Why LNG?
 Turning framework conditions into opportunities:
 Environment – negative footprint from air pollutants,
emissions, particulate matters.
 Technology – progress in technologies and infrastructure
in transport, energy and other markets.
 Economy – intensifying globalisation and intra-trade
among global regions; increasing supply and demand
conditions; cost-benefit scenarios.
 Governance – international and EU regulations; local
regulative incentives; collaboration and
internationalisation.
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 Reducing Environmental Pressure from Shipping

 Ability and feasibility to reduce emissions

Durr et al, 2005. LNG Technology for the Commercially Minded.

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 LNG as Technologically Feasible Solution
 LNG is the most promising alternative shipping fuel
technology in the short to medium term, at least for
short sea, e.g. Ro-Ro vessels.
 Nearly a decade of small scale LNG driven ships
experience has proven the reliability of the technology.
 Suitability of LNG for long-distance freight transport as
an alternative to diesel.
 Reduction of fuel costs of LNG in comparison with diesel
for inland navigation by approx. 20%.

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 LNG as THE Alternative

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 LNG as A Blue & Green Business Opportunity
 Building critical mass for LNG
 Secure energy supply
 Ensure competition
 Blue & green growth and innovation

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 LNG As Alternative Competitive Edge for Blue
& Green Growth 1
 Marine technology service providers
 Shipbuilding
 LNG distribution, bunkering and storage solutions across
multimodal transportation
 Port operation environmental performance
 LNG cooling energy for storage and loading operations
 Strategic approach towards the LNG infrastructure
deployment in BSR shaping BSR Blue Corridor strategy
 Adding users to existing LNG infrastructure –> decreasing
costs
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 LNG As Alternative Competitive Edge for Blue
& Green Growth 2

 Marine technology service providers

 Technology, skills and knowledge for LNG value chain,
establishing BSR LNG competence centre
 Business opportunities for regions LNG industry, establishing
BSR LNG business cluster.
 Competence building – & sharing opportunities
 Sustainability factor for LNG infrastructure, providing LBG
value chain, technological concepts and business models

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 LNG is regarded as one of the most promising
alternative strategies and business opportunities. Yet, High infrastructure cost
and limited demand, effects to the fact that cost of infrastructure is from 30 to
50 % of the LNG cost for end user.

Yet, no recent studies record approaches on LNG use as

opportunity and value proposition leading towards emerging
Research value chains that integrate different transport modes and
Gap business sectors, and where LNG is recognised as value
proposition for all stakeholders involved.

How to integrate LNG stakeholders involved in diverse LNG

Research activities, with different needs, capacities and capabilities into
Question one macro-regional transport and energy supply and value
chain?
LNG value chain integration for BSR - 2017
Domain of LNG Value Chain Integration
Segments of Infra- Environ-
Know- structure
LNG Value & Economy & ment & Evaluation
Segment Specification ledge & Business Gover- Location criteria
Chain of the Skills Technolog nance
BSR y
LNG feeder vessels +++ + 0 0 SE Existing +++
LNG bunker vessels +++ ++ ++ ++ SE Developi ++
Shipping ng
Ship-to-ship bunkering +++ ++ ++ ++ BSR Projected +
(STS)
LNG Terminals LNG Import terminal +++ ++ ++ ++ LT, NO, PL SE Planned 0
Small-scale export / +++ + + + DK, LT, PL, SE Missing -
bunker facilities
LNG bunker stations ++ 0 - 0 DK, NO, SE
LNG onshore LNG filling stations ++ ++ - 0 DE
infrastructure
LNG fuel tank +++ +++ ++ ++ BSR
containers
LNG trucks +++ + + + DE, LT PL, SE
Tank & bunkering +++ ++ ++ ++ BSR
solutions
LNG trucks for roads +++ ++ - ++ LT
LNG-fuelled buses for +++ ++ - ++ NO, PL
End-users public transport
LNG power supply ++ - - - DE, NO, SE
LNG ferries +++ +++ ++ ++ DE, DK, NO,
PL, SE
LNG tank containers ++ 0 - - LT
for railways
 Lack of Refuelling Infrastructure

Source: NGVA, 2018

Overall Strategy for LNG Value Chain Integration

Source: Gerlitz, 2018

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Theory based and practice related research have been applied and built upon …

Qualitative expert Marine Competence, INTERREG IV

interviews MarTech Technology and Knowledge A South EU Clean Fuel
LNG Transfer for LNG in the South Baltic Strategy
Baltic Sea Region Program
Surveys EU Directive on
LNG Value Chain for Clean INTERREG V Deployment of
Shipping, Green Ports and B Baltic Sea Alternative Fuel
Go LNG
Practical findings Blue Growth in Baltic Sea Region Infrastructure
Region Program

Primary empirical data sources were gained in Findings have been validated &
Research form of: verified by the project target groups:
findings
Empirical data • Policy makers
mainly
• Ports’ &terminals’ operators
based on Evidence- from
Obser-vations • International associations &
primary based quantitative
gained from corporations
and observations surveys and
project • Shipping companies & ship building
qualitative (here: case qualitative
activities yards
data studies), expert • Academic & research institutions
interviews • Regional industries

WWW.GOLNG.EU
 Strategic ecosystem approach for macro-regional
and cross-sectoral LNG value chain integration
• LNG knowledge basis & skills • Availability of LNG technology
development
& resources
• Education & Training
• Cross-industrial LNG
• Research tools & infrastructure
applications
• Accessibility to knowledge &
• Macro-regional infrastructure
skills
Knowledge & Infrastructure & development
• Cross-sectorial and
multidisciplinary capacity Skills Technology • Shared technology &
building infrastructure
• Organisational culture & • Digitalisation & advanced IT
learning toolkits
Integrating LNG
Value Chain
• Access to finances & LNG
infrastructure funding
• Macro-regional governance Environment Economy schemes
• Strategic future foresight & Governance & Business • Co-funding & crowd funding
• Harmonisation of regions' opportunities
framework conditions • Shared ownership and joint
• Sustainability compliance projects
• Social responsibility • Open innovation
• Cross-sectorial collaboration
and internationalisation
Source: Gerlitz, 2017
WWW.GOLNG.EU
Small-Scale LNG Terminal & Distribution – Lithuania

Source: Klaipedos Nafta 2018

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 LNG for End-Users: LNG for Energy – Germany

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Source: Becker Marine Systems, 2018
 LNG Ships – Sweden

Source: Furetank

Half of all ships on order are LNG driven !

LNG is obviously the fuel of the future, at least if you study
the list of ships in order with any relation to Sweden.

Sjöfartstidningen, 4 april 2017, kl.

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Small-Scale LNG Distribution – Lithuania

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Source: LNG Cluster Lithuania, 2018
LNG for Transprotation: LNG Hybrid Locomotive – Lithuania

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Source: LNG Cluster Lithuania, 2018
Functional LNG Value Chain Integration in the BSR

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Source: Gerlitz, 2018
Example of Value Chain at a Port…
QUESTIONS?
GO LNG PROJECTYOU
THANK

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