KR Webzine Vol.160

KR has joined a consortium of Korean companies, which include LOTTE Fine Chemical, POSCO, Lotte Global Logistics, HMM and Korea Shipbuilding & Offshore Engineering, to explore the development of a green ammonia supply chain.

Ammonia is a zero-carbon fuel attracting worldwide attention as an eco-friendly option to meet global carbon neutral regulations. Under the terms of the new agreement, the companies will work together on areas of the supply chain to form an end to end solution for ammonia bunkering, including production, storage, and transportation.

Korea Shipbuilding & Offshore Engineering (KSOE) plans to develop an ammonia-powered ship, which will be certified by KR. HMM and Lotte Global Logistics will focus on testing and operating the vessel. POSCO will be responsible for the production of green ammonia overseas, while LOTTE Fine Chemical will transport the fuel and perform bunkering operations.

<Cooperation Diagram>

The International Maritime Organization (IMO) has set the goal of reducing greenhouse gas emissions by 50% by 2050 compared to 2008 levels. As a result, fossil fuels are expected to be gradually replaced by eco-friendly ship fuels such as ammonia and hydrogen. According to the ‘2050 Zero Carbon Roadmap’ report recently released by the International Energy Agency (IEA) ammonia is expected to account for 45% of marine fuel by 2050.

In order to gain a competitive edge in the future eco-friendly market, Europe and Singapore have formed a multinational consortium to develop related technologies and standards. This agreement is significant because it is the very first time that Korea has formed a consortium of global-level companies in ‘one country’, covering the entire value chain, from green ammonia production and distribution to ship development and operation.

KR published its first technical report ‘Forecasting the Alternative Marine Fuel – Ammonia’ back in 2019 when ammonia was still unfamiliar as a marine fuel. In the second half of 2020, KR completed a risk assessment, granted Approval in Principle and signed an MOU with EMEC ship design company, Man Energy Solutions, a ship engine manufacturer, and Navig8, all with the aim of promoting the use of alternative, cleaner fuels. KR continues to support the drive for cleaner fuels, and intends to publish further guidelines for ammonia fueled vessels later this year.