New gas market

Don?t hold your breath, but? There is a body of opinion within the industry that believes the transportation of carbon dioxide (CO2) represents a growth market. If this view is correct, the CO2 market could provide opportunities for shipowners, shipyards and specialist equipment manufacturers alike.

“[Because of the]? reduction of CO2 in the environment and its increasing use, I can see it as a logical trade,” explains Chris Clucas, gas projects manager at Dorchester Maritime.

Consumer uses

The current uses of CO2 vary. Norsk Hydro, one of the few companies already involved in CO2 shipping, suggests it can be used as a refrigerant in cryogenic freezing, for carbonating beverages and to replace strong acids in pH control for waste water treatment.

Norsk Hydro?s subsidiary Hydro Gas & Chemicals has three specialist vessels, with cargo capacities ranging from 860-1,200t, that it employs in the CO2 trade. These collect CO2, produced as a by-product during the manufacture of ammonia for fertilisers, from the company?s plants in Porsgrunn (Norway), Sluiskil (The Netherlands) and Ferrara (Italy) and deliver the gas to nine terminals throughout Europe.

The ships, all converted general cargo vessels, carry their cargo in non-refrigerated insulated tanks, which allow for a pressure increase of 5-7 bar according to Wiebe Buist, shipping manger at the company. This restricts their maximum voyage length to a certain number of days as otherwise cargo loss would occur through a need for venting.

Dutch operator Anthony Veder & Co employs a single 1,250m3 capacity fully pressurised, fully refrigerated CO2 carrier in the Baltic and north-west Europe trades. The small 1,666 dwt ship, Coral Carbonic, built in 1999 by Netherlands-based Frisian Shipyard, is claimed to be the world?s first purpose-built CO2 carrier.

The opportunities that exist now for CO2 transportation, as these examples demonstrate, are for small ship, short sea operations. Buist says the CO2 end user market has been growing in line with growth in the industrial gases market.

Anthony Veder?s managing director Jan Valkier is not optimistic though on the growth prospects for the transportation of CO2 for consumer uses. “It is a very, very small market,” he says. “CO2 is a very low value product so it is difficult to transport.”

Undersea reservoirs

However there are those who believe a shipping market in CO2 can grow without a new end user or new application to generate increased consumer demand. They believe that a fleet of ships could be built merely to ship captured CO2, produced during the burning of coal, oil and natural gas as well as during processes such as the production of ammonia, to an offshore dumping ground.

As alluded to by Clucas earlier, this market would exist because of emissions regulations imposed on industry to tackle global warming. Such regulations are probably the likeliest cause for an upsurge in demand for specialist CO2 ships.

Song Deuk Lee of the Korea Shipbuilders Association takes this view. “It is my full belief that liquefied CO2 vessels will be required in this decade,” he says.

He believes that the increasing electric power demand in countries such as China and India combined with concerns about the contribution of CO2, a greenhouse gas, to global warming will create a supply of the gas ? power stations ? and a demand ? depleted offshore oil wells. In this instance, he explains, the CO2 is injected as a hydrate into the depleted wells, as a competitive replacement to the current system where wells are injected with treated water.

Valkier agrees that reinjecting CO2 into oil facilities represents potential for transporting the gas beyond its carriage for consumer use. However he believes that this would not require ships. “It doesn?t make too much sense to me,” he says. Rather he thinks that CO2?s transportation for this purpose is more efficiently served by pipelines.

Lee says that in some instances pipelines make economic sense, but in other cases the well is too far from the power plants for a pipeline to be viable. As for the ships undertaking the task, Lee believes they will be very similar to LPG carriers. “Existing LPG carriers can do such work if minor modifications are done,” he says. If the trade takes off it would create a subsequent newbuilding requirement for ships to perform the task he adds.

Consumers and oil companies are most likely to bear the costs of any such trade, says Lee. This cost will mean that before any trade is realised the likelihood is that specific regulation will be required restricting CO2 emissions accompanied by further detailed investigations into whether this is an economically competitive way to dispose of any excess gas.