Singaporean container shipper X-Press Feeders is set to introduce green methanol bunkers to power a segment of its fleet in Europe by the second quarter of 2024. The decision aligns with the European Union's expansion of its Emissions Trading System (ETS) to encompass carbon dioxide emissions for all ships of 5,000 gross tonnage and above entering EU ports from the coming year.
As part of the initiative, shippers can opt to purchase carbon credits for emission offset or utilize lower-carbon fuels like methanol and biofuels, albeit with limited fuel supply availability. In line with this trend, container industry leader AP Moller Maersk has significantly increased orders for methanol-powered vessels over the past year.
X-Press Feeders, overseeing a fleet of more than 100 vessels worldwide, has committed to 14 dual-fuel ships capable of utilizing both methanol and traditional bunker fuel. The maiden vessel, Eco Maestro, constructed in China, is anticipated to navigate from Shanghai to Rotterdam via the Suez Canal. The vessel will refuel with green methanol supplied by OCI Global at key bunker ports along its route, according to Francis Goh, X-Press Feeders' Chief Operating Officer.
The company anticipates receiving eight vessels in 2024, with the remaining six slated for delivery between 2025 and 2026. These ships will primarily operate routes from Rotterdam to ports in Scandinavia and the Baltic states, with potential expansion to other regions in the future.
Using green methanol, derived from biomass or captured carbon and hydrogen from renewable sources, can reportedly reduce carbon dioxide emissions for X-Press Feeders' ships by 65% compared to conventional fuels. However, securing a sufficient supply of green methanol remains a challenge.
X-Press Feeders has entered into a term contract with OCI Global for the supply of green methanol starting in 2024. Additionally, discussions are ongoing with other Western producers to ensure a steady and expanded supply chain, Goh stated.
