1. Baltic Sea Strategy Annual Forum Green Growth Workshop A feasibility study on an LNG Infrastructure for Short Sea Shipping (Project 4.6 in the EUBSS) Mogens Schrøder Bech Danish Maritime Authority 15 October 2010

2. Outline The Danish Maritme Authority LNG in short Aim of the project The project Partners Conclusions

3. The Danish Maritime Authority An Authority within the Ministry of Economic and Business Affairs Mission To promote health and safety on clean seas and to effectively strengthen the competitiveness and employment of maritime industries Vision To set up pointers for future quality shipping Our results matter We seek influence and results nationally as well as internationally, and we achieve clear improvements for companies, seafarers and society in general On ”stop shopping” To a wide extent

4. LNG – Transport, storage and logistic Natural Gas Main content methane Liquefaction -162 degrees Celsius Volume decreases with 1 : 600 Transport, storage and bunkeringReliquefaction on bord the shipNatural gas for combustion

5. LNG – environment and climate change ”Friendly” No sulphur No particles No soot Nitrogen oxides heavily reduced Climarte change reduced Still a fossil fuel! Shipping is a/the most problematic sector from a renewable fuel point of view

6. LNG is to become a competitive fuel for shipping ECA (Emission Control Area) provisions A sulphur content reduction from 1.0% to 0.1% in 2015 Or equivalent technologies Loss of competitiveness for Short Sea Shipping A new avenue for innovation is needed The LNG supply chain Operation of ships Economies of scale in order to reduce costs A proper framework as enabler Hard as well as soft

7. Do we have a Gordian LNG knot? Manufacturers can supply LNG engines, tank systems, etc. In order to invest, shipowners need access to a system of LNG bunkering facilities The LNG providers will invest only if there is a market No momentum until the infrastructure problem is solved A broad infrastructure perspective is needed The problem is biggest for international shipping Oil-based fuels, on the other hand A supportive and competitive infrastructure No major cash flow problems for the infrastructure

8. A strategic decision paper on an LNG infrastructure is needed 1/2 Central enablers must be identified Basis for policy making Basis for industrial standards and co-operation Basis for commercial decisions Holistic paper Shipowners, ports, LNG providers, states, EU and IMO, etc. Ownership is needed

9. A strategic decision paper on an LNG infrastructure is needed 2/2 Supporting framework conditions A system of LNG filling stations Regulation and industry standards, etc. Recommendations Test of recommendations

10. The feasibility study/central enablers Safety Local municipalities and public awareness Technical possibilities for fuelling ship engines with LNG Fuelling of other means of transport etc than ships from ”maritime ” LNG filling stations LNG filling stations - fixed and mobile Economy - Shipowners, ports and an LNG providers The LNG market The potential

11. Schedule An EU application submitted 31 August 2010 The TEN-T call for Motorways of the Sea Start of feasibility study and test of recommendations from Q2 2011 Depends on the EU decision about the application End Q1 2012

12. Partners States: Belgium, Denmark, Finland, Sweden and Norway Regional: Council of Nordic Ministers Ports: Port of Hirtshals (DK), Port of Zeebrugge (BE) and Szczecin and Swinoujscie Seaports Authority (PL) LNG terminals and gas distribution companies: Fluxys (BE), Gasum (FI), Gasunie (NL), Energinet.dk (DK), Energigas Sverige (SE) and Gasnor (NO) The Maritime Cluster: Germanischer Lloyd (DE), MAN Diesel and Turbo (DK), Lauritzen Kosan A/S (DK) and indirectly The Danish Maritime Fund

13. Conclusions The competitiveness of Short Sea Shipping is set under pressure by the ECA provisions Modal back shift must be avoided Shipping must be green A new avenue for innovation based on LNG is needed A supporting framework must be set up – hard and soft! Central stakeholders must contribute and take ownership

14. Thank you for your attendance