Norwegian JV gets public funding to build ammonia-fueled ships

Ammonia-powered shipping joint venture Viridis Bulk Carriers and consortium partners have been awarded NOK 13.75 million ($1.5 million) in development funding from the Norwegian Pilot-E program to build ammonia-powered vessels.

As informed, the aim of the “FlexBulk – NH3 Power” project is to realize a carbon free short sea bulk transportation service comprising cargo, ships- and fuel logistics.

The consortium partners include Amon Maritime, Kongsberg, Elkem, Navigare Logistics, Arena Ocean Hyway Cluster, Sintef, Yara, Franzefoss Minerals, Vestkorn, Saltimport, Viken AT Market, Mosvolds Rederi and Biomar.

Grant support from Norwegian government to drive decarbonisation of shipping

The Pilot-E program is a collaboration between the Norwegian Research Council, Innovation Norway and ENOVA, designed to support innovative maritime projects from idea stage to full scale realization.

The grant includes support from each of the institutions. The value granted to Viridis Bulk Carriers does not yet include investment grant from ENOVA.

Viridis Bulk Carriers is a new joint venture between Navigare Logistics, Amon Maritime and Mosvolds Rederi. It is solely focused on building and operating ammonia-powered short sea bulk vessels.

The Viridis vessel platform is directly applicable for 3,000+ ships in Europe and indirectly applicable for most others shipping segments.

“This award is a recognition of our vision and marks a milestone in our commitment to an environmentally friendly fleet renewal. Through our FlexBulk project, we will build the world’s first short-sea fleet based on ammonia as fuel, and we are pleased that the Norwegian authorities are helping to promote innovative initiatives towards the green shift,” Espen Nordstrøm from Viridis Bulk Carriers / Navigare Logistics said.

Ammonia-powered ships and infrastructure

According to the JV, the ships will be sufficiently flexible to handle varying types and volumes of cargo, in terms of both operational range and functional capabilities, while maintaining crew and societal safety at the level of conventional ships.

Viridis Bulk Carriers expect to place the first shipbuilding orders within the end of 2022, with deliveries starting in 2024/25.

The project “Flexbulk – NH3 Power” is closely related to the sister-project “Ammonia fuel bunkering network” project which received NOK 89 million from the Norwegian Green Platform program earlier this year.

Together, the two projects remove the chicken-and-the egg dilemma for introducing new fuels. The granted support will expedite technical and commercial development and be an enabler, catalyst and accelerator for introducing ammonia fuel in shipping.

Global adoption of ammonia as marine fuel has a massive potential to reduce carbon emissions, since it is scalable to serve the entire deepsea shipping fleet.

“Our strategy is to lead the green shift in shipping through commercial and technical innovation. We are certain that the Pilot-E grant from the Norwegian government will prove to be an important success factor for placing the first ammonia-powered cargo ships on the water,” André Risholm from Viridis Bulk Carriers / Amon Maritime said.

Close collaboration with client partners

Together with client partners Elkem, Yara, Franzefoss Minerals, Vestkorn, Saltimport, Viken AT Market and Biomar all cargo flows will be evaluated to find the best synergies to optimize the trading of the vessels.

These seven charterers alone have an underlying short sea bulk cargo volume of 20 million tons across 5,000 + shipments per annum, equal to 100 ships in operation.

The project will realize commercial viability of zero-emission solutions through business model innovation and increased ship utilization – based on a significant optimization effort.

“Elkem earlier this year announced a new climate roadmap detailing how the company plans to develop its business in line with the aim of the Paris agreement, reducing emissions towards net zero while growing supplies to the green transition,” Ellen Groeneveld, Managing Director at Elkem Maritime Center, noted.

“The FlexBulk project with Viridis Bulk Carriers, fits with our strategy to start reducing emissions from ocean transportation as soon as possible.”

“Franzefoss Minerals are moving large cargo volumes at sea and we need to reduce the carbon foot print in our logistical chain. Being part of the Flexbulk project is important for Franzefoss and we look forward to Viridis Bulk Carriers bringing green vessels to the market,” Nils-Petter Eriksen, Chief Sales Officer at Franzefoss Minerals AS, commented.

“80% of the remaining CO2 emissions in our value chain, which we can influence ourselves, come from transport. Viridis’ FlexBulk project uses the right approach, and we look forward to using these ships to transport our goods in the future,” Aslak Lie, CEO at Vestkorn, said.

“This grant is very important to the Viridis project and an important step to start the decarbonization of shipping, Yara Clean Ammonia is a global producer of Ammonia as a shipping fuel, and also involved in developing bunker solutions. This is a ground-breaking collaborative project where the visionary companies are taking the first big step to make ammonia as zero-emission fuel a realistic option for the future,” Murali Srinivasan, Senior Vice President, Yara Clean Ammonia, pointed out.

“Viken AT Market manages an important sustainable resource for the green shift. This resource is important both for our generation and not least future generations. We have a focus on the entire value chain and more sustainable logistics solutions are an important part of this. The Flexbulk project helps us on our way to our goals towards contributing to a green shift also in shipping,” Kjersti Denver, Supply Chain Manager at Viken AT Market, explained.

“The development of new carbon-free solutions in shipping is important, and Flexbulk is a significant step in getting the decarbonization within the maritime industry started,” Tore Gunnar Wikdal, Director Distribution and Inbound Logistics at BioMar, said.

“As a total supplier of salt products which is a sustainable raw material with great national significance for both road, industry and fisheries, Saltimport has a strong focus on sustainable solutions… the project is very important in helping to reduce emissions in the value chain. We look forward to further cooperation and help to find a carbon-free solution for sea transport,” according to Lisbeth Nordal, Dry Cargo Broker at Saltimport.

“The shift to a more sustainable future requires collaboration. Flexbulk is a unique example with broad commitment from 7 client partners who will achieve significant synergies between them. Combined with Viridis Bulk Carries, an innovative shipping company, they are positioned to lead the green shift in short sea shipping,” Kristin Svardal, Innovation Manager at Ocean Hyway Cluster, said.

“SINTEF Ocean is looking forward to finding new solutions for coastal bulk transport in the FlexBulk project. The combined know-how and expertise in the consortium provides an excellent platform for developing robust solutions for the market,” Anders Valland, Research Manager at SINTEF Ocean, concluded.