Wartsila Corp. said Thursday it has signed an agreement with Royal Dutch Shell to promote the use of liquefied natural gas (LNG) as a marine fuel. Separately Shell said it plans to sell LNG for heavy-duty fleet vehicles at some Shell Flying J truck stops in Alberta beginning in 2012.
Helsinki, Finland-based Wartsila, which manufactures and services power sources in the marine and energy markets, said the agreement with Shell was signed in August and will run for several years. Shell will provide its first deliveries of LNG to Wartsila natural gas-powered vessel operators from the Gulf Coast, with future deliveries coming from other areas.
Wartsila said LNG would help ship owners and operators comply with increasingly stringent environmental laws. The company said ships equipped with dual-fuel engine technology would have less of an impact on the environment because nitrogen oxides (NOx) would be reduced by about 85% compared to diesel operation, and sulfur oxide (SOx) emissions would be completely eliminated. LNG is also cheaper than diesel.
“It’s an exciting time for the industry to have Shell, a major player, committed to increasing the availability of clean natural gas as a marine fuel,” Wartsila Vice President Christoph Vitzthum said.
Shell said it is working to acquire the necessary engineering and regulatory permits to produce LNG by 2013 at its Jumping Pound gas processing facility in Alberta. Once the company receives regulatory approval, the investment will become the first of its kind for Shell globally. In the interim, LNG will be supplied to the truck stops through agreements with third-party vendors.
“As global demand for transportation fuels increases, including for LNG, Shell is well positioned to meet this demand,” Shell Oil Co. President Marvin Odum said. “LNG can provide great advantages for our commercial customers as a future energy solution in transportation. LNG will be a welcome addition to Shell’s portfolio of quality transportation fuels.”
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