Shell started life in the 1880s as a shipping company, bringing shells back from the Far East. Today, on any one day, Shell has an interest in 1,500 ships and barges on the world’s oceans and rivers. It undertakes 100,000 cargo operations every year and is the world’s largest charterer of ships. Shell is also one of the world’s largest liquid natural gas (LNG) producers, with sales of around 19 million tonnes in 2011 and an interest in ventures supplying more than 30% cent of global LNG.
The two elements, shipping and LNG, come together in Shell’s management and operation of 50 LNG carriers. Shell is a world leader in LNG and has been shipping it for 45 years, which makes it best placed to meet an exponential rise in demand predicted for the coming years.
“The International Energy agency (IEA) estimates that between 2008 and 2035 at current consumption, demand for natural gas could grow by 60% globally,” says Grahaeme Henderson, VP Shipping.
Demand will be highest in non-OECD countries and, in particular, China’s middle class is expected to grow five-fold in the next 25 years as people buy their first washing machines, cars and fridges, energy demand will rise. At the same time, the issue of climate change and reducing global CO2 emissions remains paramount.
“Natural gas is really the ideal 21st century energy source,” says Grahaeme. “It is abundant, affordable and the environmental benefits of natural gas-fired power are tangible, sustainable and immediate. The IEA estimates that recoverable gas resources can sustain current consumption for two and a half centuries. Displacing coal-fired power with natural gas is the fastest and cheapest route to CO2 emissions reductions in the global power sector over the next 20-plus years.”
There are as many LNG port-to-port routes around the world as there are vessels, 370 in total. However, to continue to meet rising demand and take into account unforeseen events such as the tsunami that hit Japan last year, Shipping is evaluating every step in the chain of departing and arriving at terminals, and on the sea voyage, to streamline and simplify activities and increase operational flexibility.
The first stage in this exciting piece of work is “Virtual arrivals” – an industry process whereby weather patterns are analysed, and algorithms calculate and agree a notional vessel arrival time. It allows ships to be in contact with their port of arrival, and slowed down if there is a delay. Among other things, it reduces fuel consumption and greenhouse gas emissions.
Read more at: Shell Shipping