In focus: Time to part ways with old habits

Old habits die hard. Hence, it may be a lot more difficult for the offshore energy industry and the maritime sector to make peace with the transition they have to undergo and renounce previous business practices.

The message was echoed in this week’s protest of Greenpeace environmental activists, who chained themselves in front of the Norwegian Ministry of Petroleum and Energy in protest against the award of new production licences off Norway.

Namely, as part of the 25th licencing round, the Norwegian government on Wednesday offered four production licences to seven oil and gas companies. Out of those four licences, one is located in the Norwegian Sea while the other three are all in the Arctic Barents Sea off Norway.

As part of its protest, Greenpeace demanded that the next government advocates a complete halt to all oil exploration, in line with the IEA’s recent report, which said that there is no place for further oil and gas investments in the net-zero roadmap.

The calls for no new oil exploration come as the draft is leaked of a new EU law intended to drive the uptake of clean fuels by ships. The official version of the bill is set to be released in July.

Brussels-based environmental NGO Transport & Environment said the inclusion of LNG and biofuels in the law, which was supposed to drive ships to progressively switch to sustainable marine fuels, would cause the EU to miss its 2050 decarbonization goals.

LNG has been identified by the maritime industry as the go-to transitional fuel, however, it has been under a lot of fire over its well-to-wake impact on the environment.

“Counting fossil gas and biofuels as green will lock shipping into decades of further pollution while we should be promoting renewable hydrogen and ammonia,” Faig Abbasov, shipping programme director at T&E, said.

Meanwhile, the shipping sector continues to order LNG-fuelled ships being faced with a lack of other viable alternatives. On Tuesday, German liner major Hapag-Lloyd revealed it has hired the South Korean shipyard Daewoo Shipbuilding & Marine Engineering to build six dual-fuel containerships with a capacity of over 23,500 TEU. The contract is worth KRW 1.1 trillion (about $1 billion). 

The large container ships will be outfitted with high-pressure dual-fuel engines that will operate on LNG, but they will also have sufficient tank capacity to operate on conventional fuel as an alternative, according to Hapag-Lloyd.

Coupled with the six vessels ordered last year, the latest deal will bring the liner company’s order tally to a dozen LNG-powered 23,500+ TEU ships in total.

At this point in time, there is no technology in sight that would make large, ocean-going ships carbon-neutral in the next three to five years, CEO of Hapag-Lloyd, Rolf Habben Jansen believes.

“That means that if you want to modernise your fleet, ideally you opt for something that has significant upward flexibility. For example, in our investments, we went for dual-fuel engines that are, in principle, suited to run on synthetic fuels that are carbon neutral going forward, even if they may operate on LNG initially,” Jansen said at the beginning of this month while addressing a Green Shipping Roundtable.

Nevertheless, renewables are not renouncing a good fight marking several breakthroughs this week in major projects.

Scottish wave energy developer AWS Ocean Energy has reached a milestone in the construction of its Waveswing wave energy device, having joined two large concentric cylinders to give the device its final shape.

The final hook-up of the internal systems for the 16kW partial-scale device is now underway. The Scottish developer said it expects to start commissioning and testing the submerged point absorber-type wave energy device early in July.

Separately, the NeuConnect interconnector between the UK and Germany has secured an updated UK Interconnector Licence from the UK’s Office of Gas and Electricity Markets (Ofgem).

NeuConnect is a privately-financed £1.4 billion interconnector that will create the first direct link between UK and German electricity networks, connecting two of Europe’s largest energy markets for the first time.

Over 700 kilometres of subsea cables will allow 1.4 GW of electricity to flow in either direction.

The project is now targeting reaching financial close this year, allowing major construction work on the new link to begin in 2022.

On the offshore wind front, the chemicals giant BASF has entered into a deal with Vattenfall on the sale of 49.5 percent of Vattenfall’s Hollandse Kust Zuid (HKZ) offshore wind farm in the Netherlands.

Once fully commissioned in 2023, HKZ will be the largest offshore wind farm in the world and also the first one ever to be built without subsidies for the power produced.

Vattenfall will use HKZ to supply fossil-free electricity to its customers in the Netherlands, while BASF plans to use its electricity share to support chemical production in sites across Europe.

Finally, diesel-electric operation is getting a greater grasp of the dredging market.

Callan Marine has released a tender package for construction of its latest fleet addition, a trailer suction hopper dredge to be named Admiral Nimitz. With an overall length of 422 ft and a breadth of 92′, the vessel is set to be the U.S. largest capacity trailing suction hopper dredge (TSHD).

The Nimitz will be diesel-electric powered. The company also owns General MacArthur, the largest fully diesel-electric dredge of its kind in North America. With electric power, dredgers can get to work right away versus traditional engines that have to ramp up before dredging can begin.