DNV GL forms LNG Solutions Group in the Americas

(HOUSTON) — To meet the rapidly growing demand for a wide variety of LNG-related services, DNV GL has established a group of LNG experts in North America. In addition to deep LNG expertise, the Houston-based LNG Solutions Group – Americas is also experienced in all business, risk and regulatory matters specific to the North American market.

With the increasingly strict regulation of sulfur emissions in force next year and the already tightened Emission Control Area regulation for the U.S., shipowners are likely to feel more pain by the rising fuel prices. For instance, due to the new regulations, marine gas oil (MGO) will likely see a price jump in three months, possibly as high as 30 percent in the short term, and a minimum of 20 percent in the long term. This has impact well beyond the maritime industry.

“Judging from our list of recently completed projects, you can clearly see the market is about to reach a tipping point, from market, feasibility and risk studies to actual new-buildings, export and bunkering facilities,” says Bjørn-Harald Bangstein, director of Operations Maritime Advisory, Americas.  

As of July 2014 there are 116 LNG fueled vessels in total (50 vessels in service and 66 on order). Of these, 75 are classed by DNV GL (46 in service, 29 newbuildings), which gives DNV GL a market share of 65 percent. “We are now doing what we can to meet pent-up demand for LNG services also beyond the maritime industry by drawing on our expertise from oil and gas. This allows us to offer an unrivaled set of capabilities, from major export or liquefaction projects to small scale bunkering and everything in between,” says Bangstein.

”More than any other company, DNV GL has championed LNG as a solution for some of the main challenges facing the maritime industry: fuel cost and emission reductions. Combined with the abundance of cheaper natural gas in North America this contributes to a surge in LNG activities. We are happy to now see shipowners, yards, ports, bunkering operators and LNG proponents in general acting to be well positioned for LNG,” says Bangstein.  

Regulatory certainty underway

“Through our interfaces with the U.S. Coast Guard, both formal and informal, we know that they are now finalizing the remaining regulatory requirements on a detailed level. They are doing so in an open and consultative manner that involves the industry and prevents surprises and misunderstandings. Naturally there could be additional state, county and municipal regulations. But with a national regulatory framework designed to prevent major hazards using a risk based approach, particular local variations can be addressed through risk assessments, allowing for a consistent and predictable national regulatory framework,” he says.

Drawing on experiences also from previous LNG projects around the world, the Houston-based  group can offer class and advisory services throughout the value chain of LNG. The group has the following sets of competencies:

LNG as fuel, class and statutory requirements

Regulatory advisory operations and bunkering:
• DNV GL’s recommended practice for bunkering
Crew training standard
Feasibility studies ship and shore facilities:
• Technical
• Financial
• Risk assessments
• Gas dispersion analyses
• Technology qualification
Waterway suitability assessments
Navigational risk assessments

A selection of DNV GL’s recently completed LNG projects in North America show a trend towards a tipping point:

• For IMO, DNV GL carried out a feasibility study on the use of LNG as fuel in North America
• Waterway suitability assessments for several planned North American LNG export terminals
• A comprehensive risk assessment study on LNG bunkering for MarAd, the U.S. government’s Maritime Administration
• Security and risk assessment study for Washington State Ferries
• Market feasibility study for LNG America
• Classification of two LNG-ready containerships for Matson
• Classification of two LNG-fueled ro-ro containerships for Crowley
• Hosted visits from USCG and Transport Canada for familiarization with LNG as a fuel in Norway
• Technology qualification for flashing liquid expanders
• Quantitative risk assessment studies for North American export terminals
• Termpol 3.15 risk assessments for all planned LNG export terminals in Canada
• Industrywide LNG Fuel Advisory Council headed by DNV GL’s Tony Teo in 2011.

DNV GL has published several widely referenced industry documents such as "Rules for Classification: Gas Fueled Ship Installations" (last update January 2014), "Recommended Practice for Development and Operation of Liquefied Natural Gas Bunkering Facilities" (January 2014) and "Competence Related to the On Board Use of LNG as Fuel" (April 2003).

The “Rules for Classification: Gas Fuelled Ship Installations” was developed in 2000 and later introduced to the IMO which was adopted as the “IMO Interim Guidelines on Safety for Natural Gas-Fuelled Engine Installations in Ships," Resolution MSC.285(86) on June 1, 2009.

By Professional Mariner Staff