Maritime Executive: High Costs Impede LNG Use for Transport in Europe

Northern European use of liquefied natural gas (LNG) to fuel ships is becoming feasible as supply from Qatar to the Dutch port of Rotterdam becomes available, but for it to compete with oil in transport its price has to fall considerably.

New regulation on sulfur emissions in the shipping sector will come into place for much of the North and Baltic Sea in 2015, sparking interest in alternative fuels to diesel and many see LNG, currently used almost exclusively for power generation, as a viable alternative.

"LNG is seen as a popular alternative to oil as a transport fuel because it is efficient and potentially cost effective," said Gordon Inkson, energy and shipping expert at law firm Holman Fenwick Willan (HFW).

The industry estimates Baltic demand for LNG as a ship fuel will likely be around 2-5 million tons per year this decade.  MORE