Maersk eyes up to 60 new dual-fuel ships as it seeks to match fleet renewal pace

August 7, 2024, by Fatima Bahtić

Danish shipping giant A.P. Moller Maersk has unveiled that it is in the process of signing newbuilding orders and time-charter contracts for dual-fuel vessels to match the planned renewal pace of around 160,000 TEUs per year.

As disclosed, the orders represent a continuation of its fleet renewal program initiated in 2021. The orders will comprise a total of 50-60 containerships combining both owned and chartered dual-fuel vessels equaling 800,000 TEU. Approximately 300,000 TEU will be owned capacity while the remaining 500,000 TEU is planned through time-charter agreements, the company noted.

The announcement came on the back of Maersk reports of financial results from the second quarter of this year. The shipowner reported that its profit was $623 million in Q2 2024, compared to $1.3 billion earned in the same period last year. The profit drop of 52% came as a result of several factors including macroeconomic conditions, bunker fuel prices, freight rates, and Red Sea disruptions.

“Our results this quarter confirm that performance in all our businesses is trending in the right direction. Market demand has been strong, and as we have all seen, the situation in the Red Sea remains entrenched, which leads to continued pressure on global supply chains. These conditions are now expected to continue for the remainder of the year,” Vincent Clerc, CEO of Maersk, commented.

Meanwhile, in line with its commitment to decarbonization, Maersk revealed that all new units will be dual-fuel with the intent to operate them on low-emissions fuel.

To ensure the long-term competitiveness of the fleet and its ability to deliver on the decarbonization goals, the Danish shipping major has chosen a mix of methanol and liquified gas dual-fuel propulsion systems.

In 2021, Maersk ordered the world’s first methanol-enabled container vessel following a commitment to the principle of only ordering newbuild vessels that can sail on green fuels.

When running on methanol at sea, the feeder saves up to 100 tons of CO2 daily when compared to running the vessel on conventional fuel, and when you look at the greenhouse gas impact the fuel that is used provides a reduction of about 65% compared to conventional fuels, according to Maersk.

The potential can go up to 95% depending on how the methanol is produced.

Maersk has set a net-zero greenhouse gas emissions target for 2040 across the entire business and has also set tangible and ambitious near-term targets for 2030. To ensure its targets are met, the shipowner ordered 24 containerships which will be equipped with dual-fuel engines and will be able to operate on green methanol.

While green methanol is likely to become the most competitive and scalable pathway to decarbonization in the short term, the Danish shipowner also foresees a multifuel future for the industry which includes liquified bio-methane (bio-LNG).

Earlier on, the liner major commenced the work of securing offtake agreements for liquified bio-methane to ensure that the new dual-fuel gas vessels provide greenhouse gas emissions reductions in this decade.

Once the vessels have been delivered, around 25% of the Maersk fleet will be equipped with dual-fuel engines.

“Our fleet renewal program is fundamental to maintaining competitive edge in our ocean business, and it is a cornerstone in decarbonising our operations. As the shipyard orderbooks have been filling up quickly and lead time for vessel deliveries have increased significantly, we decided to place orders and charter contracts of 800,000 TEU (twenty-foot equivalent) dual-fuel vessels, which ensures a steady flow of needed capacity for our network for the years 2026-2030 while building a competitive toolkit,” Rabab Boulos, Chief Operating Officer at Maersk, commented.

“These orders will not add to the overall capacity and over time every vessel coming in will be replacing a scrapped vessel having reached end of life, ensuring that we maintain our fleet size at around 4.3 million TEU. By diversifying our fleet and fuel options, we gain the flexibility, knowledge, and experience to cater to a future with multiple fuel paths. We thank our partners for working with us to move the industry further towards enabling a future with decarbonised ocean transport,” Ahmed Hassan, Head of Asset Strategy & Strategic Partnerships at Maersk added.

In March this year, Maersk announced that more than 660,000 TEU were transported in 2023, saving over 683,000 tonnes of greenhouse gases from being emitted into the atmosphere.