Methanol as a Marine Fuel Symposium on Evolution of Marine Fuels Los Angeles July 21st 2014 Per Fagerlund [email protected]

Emission legislation IMO NOx Technical code

g NOx/kWh 16

NOx Tier II - 2011 (Global)

14 NOx Tier III - 2016 (NOx emission control areas)

12

10

8

6

4

2

rpm

0 0

100

200

300

400

500

600

700

800

900

1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

International shipping CO2 emission scenarios

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Perspectives  Short term 2015/2021

SOx, NOx  Medium term 2020/2030

SOx, NOx, PM, GHG  Long term 2050 and beyond

SOx, NOx, PM, GHG, Renewable fuels

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Alternatives  Heavy Fuel Oil + Scrubber or  Marine Gas Oil max 0.1% Sulphur or

 LNG or Methanol

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Stena Line operations in North Europe

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Marine traffic in the baltic sea

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Professor Georg A. Olah Nobel Price Chemistry 1994

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Methanol produced from forest products 72

€/MWh

29 $/MMBtu

1244

$/ton

MGO eqv.

Natural gas well head price

Methanol cost ex works

10

€/MWh

4 $/MMBtu

25

€/MWh

10 $/MMBtu

45

€/MWh

18 $/MMBtu

183

$/ton

Crude eqv.

432

$/ton

MGO eqv.

778

$/ton

MGO eqv.

Methanol along side Göteborg

Methanol CIF GOT

Natural gas well head price €/MWh

4 $/MMBtu

183

$/ton

Crude eqv.

Crude oil well head price

843

$/bbl

$/ton

€/MWh

16 $/MMBtu

690

$/ton

MGO eqv.

LNG cost ex works

10

115

40

LNG FOB Zeebrugge

18

€/MW h

7 $/MMBtu

345

$/ton

MGO eqv.

Crude landed (WTI/Brent approx) 119

$/bbl

872

$/ton

MGO port price

LNG along side Göteborg

25

€/MWh

10 $/MMBtu

46

€/MWh

19 $/MMBtu

518

$/ton

MGO eqv.

794

$/ton

MGO eqv.

MGO along side GOT

66

€/MWh

69

€/MWh

975

$/ton

1025

$/ton

HFO along side GOT

HFO port price 47

€/MWh

661

$/ton

50

€/MWh

711

$/ton

Methanol related spin-off projects Stena Germanica

SPIRETH Alcohol (Spirit) and Ether as Marine fuel

Methanol Conversion

EffShip Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Stena Scanrail

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

2CH3OH → CH3OCH3 + H2O

Liquid methanol

Temp increase to 200 C Catalytic reactor approx 90% conversion

Does not work as diesel fuel

Modified diesel engine

Pressure increase to 16 bar

Service tank 1600 L DME 260 L Water 140 L Methanol One phase liquide at 13 bar

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Double walled High pressure fuel pipes

Ballast tank converted to methanol fuel tank

Transfer pump room High pressure pump room

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

MS MARINEX. Tanker for Oil Products and Chemicals.

Fuel consumption (methanol) per day around 50 ton Source: MARINVEST Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Methanol in integral tanks and service tank on deck

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Wärtsilä 4-stroke combustion concept

Source: WÄRTSILÄ Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Wärtsilä 4-stroke Methanol engine conversion scope

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

MAN 2-stroke engine High pressure liquid gas (methanol) engine

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

MAN ME-LGI

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Inland waterways

http://www.worldcanals.com

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Road ferries

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Commuter ferries

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Inland waterways vessels

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Diesel vs methanol Fuel cost per ton $/ton €/$ Fuel cost per ton €/ton Energy content kJ/kg Fuel cost per energy unit €/kWh Typical operation Engine power kW Average part load Fuel consumption g/kWh Running hours per year Fuel consumption per year ton Fuel cost per year € Fuel cost difference

Diesel Methanol $ 1 000 $ 370 1,3532 € 739 € 273 42700 19900 0,062 0,049

400 75%

200

429 6000

360 € 266 036

772 € 211 211 € 54 825

Market price conversion €/kW engine power Market price conversiont € Pay back time years

€ €

Number of conversions per year Estimated turn over for conversion

50 € 4 000 000

Additional value  An opportunity to approach a profitable marine service market  Land based markets can also be exploited

200 80 000 1,5

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Market, smaller marine engines  Road ferries

 Commuter ferries

 Tour boats

50 50

50

Waxholmsbolaget Styrsöbolaget 20 20 Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Western European Inland Waterway Fleet Approx 10 000 vessels Standard Inland Shipping Waterway vessel L B Draft Dwt TEU Typical power

110 11,4 4 3000 200 4 x 400 kW

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB

Thank you

Presentation at Symposium on Evolution of Marine Fuels, USC 21st Julu 2014, Per Fagerlund, ScandiNAOS AB