LNG’s playbook for ammonia

Ammonia’s use as a marine fuel still feels distant, but its early barriers mirror those LNG had to overcome before scaling.

From doubts over safety and infrastructure to uncertainty around supply, LNG’s slow rise in shipping offers a blueprint for how ammonia could move from hesitation to habit.

Infrastructure: the weakest link

A new Global Maritime Forum (GMF) survey flagged bunkering infrastructure as the critical missing piece for ammonia’s adoption. Knowledge and comfort levels differ widely between ports, underscoring the need for collaboration between ship operators, port authorities and surrounding communities to ensure safe uptake, the survey found.

This pattern seems quite familiar.

In 2013, when LNG was still a niche, the European Commission (EC) noted that smaller ports hesitated to invest in infrastructure without clarity on the “future evolution (or absence) of a LNG bunkering network” and demand outlook.

Safety concerns weighed heavily too. The EC cited the “perceived negative public perception of the dangers of LNG” and urged the industry to “demystify” procedures and prove that bunkering could be carried out safely.

A decade later, LNG bunkering has become routine.

LNG bunker sales are growing in Singapore, the ARA and Ningbo-Zhoushan, and infrastructure spans many more global ports. The network is maturing with 72 LNG bunker vessels in service and another 36 due by 2028.

Milestones like Avenir LNG’s 1,000th or FueLNG’s 500th ship-to-ship operation barely raise an eyebrow anymore. Once stigmatised, LNG is now widely accepted across the world.

The parallels with ammonia are striking. Safety dominates every discussion as ports and communities worry about toxic leaks, crew exposure and public backlash. But as LNG showed, trust comes through repeated safe operations.

“Over time, the safety distance for LNG bunkering significantly decreased and flow rates have increased as the process becomes more frequent and the industry has gained confidence. I believe the same will be true for ammonia,” Global Centre for Maritime Decarbonisation (GCMD) 's Lynn Loo told ENGINE.

Today, ammonia stands at the starting line despite lingering doubts.

Three ammonia-capable ships are in operation with 39 more on order through 2029. Early terminal-to-ship bunkering operations in China or ship-to-ship transfer pilots in Australia have shown promise. The ports of Singapore and Rotterdam are preparing to facilitate bunkering soon.

Egypt’s Sokhna and East Port Said are planning dedicated bunkering infrastructure through joint ventures with Japan’s Itochu, which has also ordered the world’s first ammonia bunker vessel.

Supply uncertainty and high costs

Shipowners were also hesitated to commit to LNG in the early days.

A 2014 DNV report cited “substantial premiums” over VLSFO “combined with the lack of confirmed LNG availability for bunkering, particularly in tramp shipping" as one of the main reasons.

The American Bureau of Shipping (ABS) noted that LNG supply decisions had to be made years in advance, unlike for conventional bunkers.

“There is currently no developed spot market for LNG for the volumes that most vessel operators/owners require,” it wrote in 2014.

Ammonia now stands at the same crossroads.

Most commercial production today is grey ammonia. Green supply capacity is still thin and with only a small share is earmarked for shipping, the fuel is priced at steep premiums over fuels like VLSFO, LNG or biofuels.

Suppliers want long-term offtake agreements and shipowners are wary of committing without affordable and reliable volumes.

Tipping the scale

The situation changed for LNG when regulations created certainty.

Its first foothold came with the 0.10% sulphur cap in Emission Control Areas (ECAs).

“The use of LNG ships for the ECA region is a good option because it also has a cost advantage in comparison with marine gasoil (MGO)…,” the World Journal of Environmental Biosciences noted in 2014.

Uptake stayed slow, with fewer than 100 LNG-capable ships in service by 2017, until the IMO’s global 0.50% sulphur cap sparked the real breakthrough in 2020.

The global LNG-capable fleet grew from 156 ships in 2019 to 185 in 2020, 246 in 2021 and over 770 today.

LNG has at periods been priced lower than LSMGO, VLSFO and even HSFO on an energy-equivalent basis, and in low-methane-slip engines, it can have a more favourable emission profile, too.

History could repeat itself, as forecasts suggest that a global greenhouse gas (GHG) emission cap combined with targeted incentives could bring the cost of bunkering green ammonia below that of other e-fuels, or even fossil fuels, by the late 2030s–40s, while still offering near-zero emission potential.

Its tipping point, like LNG’s, might eventually be driven by regulatory necessity than market demand.

In other news this week, French shipping company CMA CGM acquired a minority stake in renewable gas producer Vanguard Renewables, securing long-term access to biomethane from up to four of the company’s renewable gas projects.

COSCO’s container ship was bunkered with 210 mt of methanol at Qingdao Port on China’s Yellow Sea coast. Three trucks were used to deliver the fuel to the vessel Cosco Shipping Carnation, Shandong Port Group (SPG) told China's state-owned media firm China Daily.

British energy firm Greenergy secured a 10-year lease extension with the Port of Amsterdam for its biofuels production plant. Greenergy said the lease extension reflects rising demand for low- and zero-emission potential fuels in the Netherlands, which has been supported by the Dutch government’s “clear” policy measures to increase biofuel use.

By Konica Bhatt

Please get in touch with comments or additional info to news@engine.online