More Shipowners Take the LNG Path to 2050

The outcome of MEPC 83 in April could establish the IMO’s mid-term GHG and carbon pricing strategy for achieving net-zero by around 2050. Not everyone is waiting; they have enough confidence in the LNG pathway to order new ships.

According to the latest figures from DNV’s Alternative Fuels Insight (AFI) platform, 34 new orders for alternative-fueled vessels were placed in February 2025, 33 of them for LNG-fueled container ships.

The trend is continuing this week with CSSC subsidiary Jiangnan Shipyard reporting orders worth around $2.5 billion for LNG-fueled container ships on March 2.

More than 305 LNG-fueled ships were ordered last year, accounting for approximately 14% of newbuilding orders, significantly outpacing methanol and ammonia.

A report released this week by Lloyd’s Register notes that LNG retrofits are surging. With zero-emission fuel supply chains still in their infancy, many operators are seeing LNG as the most viable retrofit option.

Also this week, the U.S. Department of Energy announced an order that removes barriers for the use of LNG as marine fuel.

A container ship case study released late last year by SEA-LNG indicated that the fuel provides the lowest compliance cost for meeting EU and IMO decarbonization regulations. The basis for this is that the LNG pathway offers GHG reductions now and in the future. The use of LNG also dramatically reduces SOx, NOx and particulate matter thereby avoiding the use of relatively expensive MGO for Emission Control Area compliance.

An immediate benefit of being on the LNG pathway was demonstrated by Furetank last month. The company’s tanker Fure Viken was bunkered with mass-balanced bio-LNG as a way of complying with the new FuelEU Maritime Regulation which requires a 2% reduction in GHG intensity this year.

Mass balancing involves purchasing and injecting biomethane of certified origins into the gas grid, while the corresponding amount of gas is withdrawn from the grid and liquefied into maritime fuel. This satisfies FuelEU Maritime requirements.

Renewable e-LNG, which is synthesized from CO2 and hydrogen using renewable energy, is attracting attention as a further big step along the pathway to net-zero that can be used in existing LNG-fueled vessels, and this week saw another commitment to it. MOL joined the e-NG Coalition saying:

“In addition to using carbon-neutral e-methane as marine fuel, MOL will contribute to the broader use of e-methane and the establishment of a value chain by developing a synthetic fuel supply chain, backed by its extensive know-how in LNG transport accumulated over the past four decades as well as expertise in ocean transport of liquefied CO2.”

Renewable e-LNG offers medium and long-term benefits and can enter the market relatively quickly, but the path is not without its challenges. A recent report prepared by ABS and CE Delft and published by EMSA notes a huge expansion in the number of renewable-electricity plants, electrolyzers, direct air capture (DAC) plants and e-fuel synthesis plants will be needed.

“Whereas the projected global growth in renewable electricity production could prove large enough to serve the demand for e-fuels of the commercial fleet in 2030, electrolysis capacity, e-fuels synthesis capacity and DAC capacity are not expected to keep pace. Furthermore, the shipping sector will need to compete with all other sectors for the renewable electricity, green hydrogen and renewable CO2 required for e-fuels production.”

Regulatory measures seem to be indispensable: “Without global policy measures to either bridge the price gap or to encourage ships to use green fuels, a transition towards e-fuels with zero-CO2 impact is unlikely to accelerate at the desired speed and scale in the next decade,” states the report.

And, as Aurelia Leeuw, EU Policy Director at the Skies and Seas Hydrogen-fuels Accelerator (SASHA) Coalition, says: “Transparency must be the point of departure for policy: only an honest account of fuels’ lifecycle emissions can lead us to the most sustainable fuel mix and the stability the industry needs. It now falls to policymakers to chart the course towards e-fuels that have the lowest lifecycle emissions.”