EMERGING LNG VALUE CHAIN IN THE SOUTH BALTIC SEA REGION

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Apr 22, 2015 - Technology Park), Vytautas Paulauskas (Klaipeda Shipping Research Centre), Charlotte Vinding ..... Table 18: Storage services providing key stakeholders of the South ...... Feasibility Study (Coordinator) LNG Terminal Construction in Police, Swinoujscie ..... Logistik Initiative Mecklenburg-Vorpommern.
Laima Gerlitz and Vytautas Paulauskas

EMERGING LNG VALUE CHAIN IN THE SOUTH BALTIC SEA REGION

JOINT STUDY ON LNG KNOWLEDGE, COMPETENCE AND PARTNERSHIP PLATFORM SUPPORTING THE BLUE GROWTH IN THE SOUTH BALTIC SEA REGION AND ON THE MACRO-REGIONAL LEVEL

In the frame of the EU project “Maritime Competence, Technology and Knowledge transfer for LNG (Liquefied Natural Gas in the South Baltic Sea Region – MarTech LNG“ funded by the European Regional Development Fund (ERDF) within the South Baltic Programme 2007-2013

April 2015

Imprint The book in hand represents a compilation of the results achieved in the South Baltic Sea Region in terms of LNG development as compared in years 2012-2015 and provides future prospects and recommendations for further LNG technology integration in the region. All rights reserved by the “MarTech LNG“ project consortium and the Coordinator of the project “Klaipeda Science and Technology Park (KSTP)”. Herkaus Mano str. 84 92294 Klaipeda Lithuania E-mail: [email protected] Website: http://golng.eu The project was part-financed by the South Baltic Programme 2007-2013 (European Regional Development Fund). Intellectual contribution of the authors is ensured and should not be reproduced without a prior permission. All questions and enquiries relating to the authors’ contribution should be addressed to the Coordinator of the project – KSTP. No part of the contents is allowed to be reproduced in any form whatsoever (photocopy, microfilm or by any means) without the written consent of the Coordinator. FINAL VERSION (April 2015) Lead by:

PP4 Wismar University of Applied Sciences: Technology, Business and Design with contribution of all project partners mentioned in the Acknowledgments

Authors: Prof. Dr. habil. Captain Vytautas Paulauskas and PhD Candidate; M.A, M.Sc. Laima Gerlitz

Acknowledgements The book in hand represents a compilation of results from the development and implementation of the MarTech LNG project implementation part-financed by the South Baltic Sea Programme 2007-2013. We would like to express our gratitude to the project partners and researches as well as project stakeholders who have worked together during the life of the EU-funded project and contributed to the development and integration of LNG in the South Baltic Sea Region. This study has been part-funded by the European Union and has seen intellectual contribution from the project partners from the participating regions: Andrius Sutnikas (Klaipeda Science and Technology Park), Vytautas Paulauskas (Klaipeda Shipping Research Centre), Charlotte Vinding (Maritime Development Centre of Europe), Steen Sabinsky (Maritime Development Centre of Europe), Anatoli Beifert (Wismar University of Applied Sciences), Laima Gerlitz (Wismar University of Applied Sciences), Andy Albert (ATI, erc gGmbH), Stefan Jankowski (Maritime University of Szczecin) and Lawrence Henesey (Blekinge Institute of Technology). We express also our thankfulness to the cooperation partners within the MarTech LNG project, who gave our research team opportunity to gather valuable practical insights into LNG as well as to the South Baltic Programme Joint Secretariat for the support.

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TABLE OF CONTENTS Acknowledgements ....................................................................................................................................... 4   List of Abbreviations ..................................................................................................................................... 7   List of Tables ..................................................................................................................................................... 8   List of Figures ..................................................................................................................................................10   Preface ................................................................................................................................................................12   Executive summary ......................................................................................................................................14   Introduction......................................................................................................................................................16   1   Methodological framework.............................................................................................................19   2   Rationale behind the LNG technology in the South Baltic Sea Region ................21   2.1   Environmental framework conditions ................................................................................................................. 21   2.2   Economic framework conditions........................................................................................................................... 34   2.3   Technological framework conditions .................................................................................................................. 42  

3   LNG-related research and training institutional profile ..................................................49   3.1   Identifying relevant institutions................................................................................................................................ 49   3.2   Specification of LNG-related knowledge & competence potential .................................................. 63   3.3   Institutional cooperation patterns ......................................................................................................................... 67   3.4   Specification of scientific LNG-related activities ........................................................................................... 68   3.5   Challenges, obstacles and future perspectives faced by the SBSR scientific community ...... 81  

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4   Scrutinising LNG value chain in the South Baltic Sea Region .....................................83   4.1   Anchoring present technological LNG-related capabilities .................................................................... 83   4.2   LNG-related stakeholders and players............................................................................................................... 85   4.3   LNG-related infrastructure .................................................................................................................................... 112   4.4   LNG product portfolio............................................................................................................................................. 114   4.5.   LNG-related services................................................................................................................................................ 118  

5   LNG-related initiatives and projects ....................................................................................... 121   6   Comparative analysis of LNG development patterns in the SBSR....................... 131   7   LNG-related value for regional development and future prospects ................... 136   8   LNG-related challenges in the next future ......................................................................... 141   Conclusions ................................................................................................................................................... 145   Summary in German ................................................................................................................................ 148   Summary in Polish ..................................................................................................................................... 150   List of references and sources............................................................................................................ 151  

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List of Abbreviations SBSR – South Baltic Sea Region LNG – Liquefied Natural Gas MarTech LNG – Marine Competence, Technology and Knowledge Transfer for LNG (Liquid Natural Gas) in the South Baltic Sea Region LT – Lithuania DE- Germany DK – Denmark SE – Sweden PL – Poland LBG – Liquefied Biogas LCNG – Liquefied to Compressed Natural Gas CNG – Compressed Natural Gas MDO – Marine Diesel Oil MGO – Marine Gas Oil IPCC – Intergovernmental Panel on Climate Change CO2 – Carbon dioxide NOx – Nitrogen oxides SOx – Sulphur oxides PM – Particles CO – Carbon monoxide HC – Hydrocarbon

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List of Tables Table 1: Emissions share per main sectors in 2012 ................................................................................................ 25   Table 2: Legislative framework supporting shift to environmental-friendly solutions in the maritime field ..................................................................................................................................................................... 28   Table 3: LNG handling related regulations and standards .................................................................................. 33   Table 4: EU measures to be implemented for clean power for transport ............................................... 46   Table 5: Research institutions in the South Baltic Sea Region .......................................................................... 50   Table 6: Training institutions in the South Baltic Sea Region ............................................................................ 54   Table 7: Consulting institutions in the South Baltic Sea Region....................................................................... 57   Table 8: Education institutions in the South Baltic Sea Region ........................................................................ 61   Table 9: Key topics in the South Baltic Sea Region science and research related to LNG development ...................................................................................................................................................................... 66   Table 10: Bunkering-related scientific-research projects in the SBSR........................................................... 69   Table 11: Shipbuilding & repair-related scientific-research projects .............................................................. 73   Table 12: Ports-related scientific-research projects in the South Baltic Sea Region ............................ 77   Table 13: Shipping-related projects in the South Baltic Sea Region.............................................................. 79   Table 14: Existing key LNG solutions in the South Baltic Sea Region ......................................................... 88   Table 15: Key stakeholders from shipbuilding & repair industry of the South Baltic Sea Region . 89   Table 16: Key stakeholders from shipping industry of the South Baltic Sea Region ............................ 91   Table 17: Key stakeholders involved into distribution activities across the South Baltic Sea Region .................................................................................................................................................................................... 93   Table 18: Storage services providing key stakeholders of the South Baltic Sea Region .................... 95   Table 19: Bunkering solutions providing key stakeholders of the South Baltic Sea Region ............. 96   Table 20: Ports of the South Baltic Sea Region with existing LNG activities........................................... 98   Table 21: Ports of the South Baltic Sea Region with forthcoming LNG-related activities ............... 99  

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Table 22: Ports of the South Baltic Sea Region revealing high potential for the LNG-related activities ................................................................................................................................................................................. 99   Table 23: Ports of the South Baltic Sea Region involved in plans for development for LNGrelated activities ............................................................................................................................................................. 101   Table 24: Key authorities of the South Baltic Sea Region relevant for LNG-related activities ... 102   Table 25: Key associations of the South Baltic Sea Region relevant for LNG-related activities 103   Table 26: Classification societies of the South Baltic Sea Region relevant for LNG-related activities .............................................................................................................................................................................. 105   Table 27: Key consultation services providing stakeholders of the South Baltic Sea Region....... 106   Table 28: Key stakeholders of the South Baltic Sea Region involved into end-user oriented technologies ..................................................................................................................................................................... 109   Table 29: Specification of present LNG-related activities of the South Baltic Sea Region value chain ..................................................................................................................................................................................... 120   Table 30: Overview of LNG-related initiatives and projects across the South Baltic Sea Region ................................................................................................................................................................................................ 121  

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List of Figures Fig. 1: South Baltic Sea Region with the participating project regions .......................................................... 17   Fig. 2: Methodological framework ..................................................................................................................................... 20   Fig. 3: Global maritime transport routes and transport density as a result of major trading economies ........................................................................................................................................................................... 21   Fig. 4: CO2 emissions projection from international shipping 1990-2050 ................................................. 23   Fig. 5: Absolute change of emissions from 1990 till 2012: Sectoral GHG emissions by IPCC sector ...................................................................................................................................................................................... 24   Fig. 6: Comparison of emissions ......................................................................................................................................... 26   Fig. 7: SECAs in Europe according to the MARPOL Annex VI ....................................................................... 27   Fig. 8: World primary energy demand by fuel 1980 to 2035 ........................................................................... 35   Fig. 9: Natural gas consumption per capita, 2013 .................................................................................................... 36   Fig. 10: Container shipping in the Baltic Sea................................................................................................................ 37   Fig. 11: Ro-Ro and passenger ferries traffic in the Baltic Sea ............................................................................. 38   Fig. 12: Recoverable natural gas reserves 2011 in trillion cubic meters ...................................................... 39   Fig. 13: Natural shale gas basins .......................................................................................................................................... 40   Fig. 14: Comparison of natural gas transportation cost ........................................................................................ 41   Fig. 15: LNG powered ships in operation .................................................................................................................... 43   Fig. 16: LNG powered ships ordered ............................................................................................................................. 44   Fig. 17: Measures of technologies in ships according Energy Efficiency ....................................................... 45   Fig. 18: TEN-T core network corridors Europe........................................................................................................ 48   Fig. 19: South Baltic Sea Region institutional profile ............................................................................................... 49   Fig. 20: Institutional portfolio in the South Baltic Sea Region ............................................................................ 50   Fig. 21: WS1 LNG/FO Combo Vessel ........................................................................................................................... 71  

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Fig. 22: LNG bunker barge TBX ........................................................................................................................................ 72   Fig. 23: FLEXI- Bunker vessel ................................................................................................................................................ 72   Fig. 24: Retrofit of ferry MS “Ostfriesland” on LNG by AG Ems ................................................................... 74   Fig. 25: German-flagged LNG-fuelled ferry .................................................................................................................. 74   Fig. 26: Floating Storage and Regasification Unit (FSRU) – technology of the LNG Terminal project in Lithuania ......................................................................................................................................................... 75   Fig. 27: LNG Terminal Project in Swinoujscie, Poland .......................................................................................... 76   Fig. 28: Construction plan for ScanBunk LNG terminal in Sweden ............................................................... 77   Fig. 29: Profile of stakeholders in the South Baltic Sea Region ......................................................................... 87   Fig. 30: LNG Import Terminal in Nynäshamn ......................................................................................................... 112   Fig. 31:LNG Terminal in Lysekil, Sweden, opened in 2014 ............................................................................. 113   Fig. 32: LNG Terminal FSRU “Independence” in Klaipeda, Lithuania ........................................................ 114   Fig. 33: LNG Hybrid Barge “Hummel” developed by Becker Marine Systems GmbH, Hamburg ................................................................................................................................................................................................ 115   Fig. 34: Nordic Arctic LNG carrier ................................................................................................................................ 116   Fig. 35: LNG Power Barge developed by Marine Service GmbH ............................................................... 116   Fig. 36: LNG fuel tank container developed by Marine Service GmbH .................................................. 117   Fig. 37: Duel-fuelled (LNG) Samsø ferry operating in Denmark ................................................................. 118   Fig. 38: Distribution of stakeholders’ capabilities along the LNG supply chain in the South Baltic Sea Region ........................................................................................................................................................................ 119   Fig. 39: MS Viking Grace passenger as novel technological LNG solution ............................................. 126   Fig. 40: MS Stavangerfjord LNG ferry with single LNG engine ..................................................................... 127   Fig. 41: LNG fuelled Fjord1 ferry built in the Lithuanian shipyard ............................................................... 129   Fig. 42: LNG-fuelled Solbus for public transport ................................................................................................... 139   Fig. 43: LNG-fuelled truck Mercedes Benz Econic LNG ................................................................................... 140   Fig. 44: Tracing LNG development in the South Baltic Sea Region ........................................................... 146

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Preface According to one of the topics of the Baltic Sea Region Strategy “Energy independency” most of the countries across the South Baltic Sea Region (SBSR), especially Lithuania and Poland, have declared their intentions to build up LNG terminals in order to mitigate their energy dependence on Russia. At the same time, the SBSR has to reduce its coal use as part of its climate policy obligations. Countries in the other part of the region – Sweden, Germany and Denmark – yield sound LNG technologies and record successful terminal operation. Against this background, it appears extremely effective to use knowledge and technology that are tested and proved to implement into the regions that plan to build LNG terminals. Problematic nature of the project initiative is based on a current situation indicating that declared investments in Poland and Lithuania will not benefit for the regional maritime industries. Because of the lack of technologies and relevant competences terminal construction and operation will be outsourced out of the countries of the South Baltic Sea Region. Supporting the local maritime industries with the LNG building and operation knowledge will allow them benefit from the investments by gaining specialisation and efficiency. Maritime companies in the region will develop new products and competencies that are demanded in the global market. Created supply chain will establish cooperation in between regional maritime industries and scientific institutions. As a result, this will allow companies to improve them products using scientific knowledge and make them more competitive by forming consortiums for big international tenders – cluster development. LNG appearance itself creates new business possibilities in transportation, port operations and energy sectors. That needs to be supported by scientific and technological knowledge to ensure benefit for the local companies. Implemented project activities will allow regional governments to benefit from energy security plans not just establishing a new energy source but also supporting local maritime industries. From these observations there can be deduced key aims associated with the project. In this light, the main aim of the project is to create a better access to technology and knowledge on LNG-related business activities to build up better competences and specialisation among the SBSR maritime business supply chain. Focus of the project is to foster know-how on LNG construction and operation within different South Baltic companies to help them define their business niche. One of the core project activities is LNG Knowledge Partnership Platform (KPP) that will assist project partners to foster business support activities, scientists to commercialise their knowledge and companies to access required knowledge and partnership. Partners will ensure dissemination of the collected information to the direct customers of the services and products. All the information will be placed on LNG KPP web communication tool and web pages of all partners involved.

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LNG developments is new activity in the Baltic Sea, and the most of the local industries in the SBSR are lacking knowledge on such type of projects. Nevertheless, it is investigated that the region research institutions and engineering companies had worked on this type of projects. At the first step of the project, it is important to gather LNG knowledge available into the one structural database developing LNG knowledge and partnership platform. Database will allow fostering science and business cooperation in the field of developing competences for the local industries and promoting regions LNG supply chain abroad. This platform that constitutes one of the core components of the MarTech LNG project results from further activities, the present joint LNG mapping study being one of the contributors to this platform.

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Executive summary The book in hand discusses LNG-related knowledge and competence development in the South Baltic Sea Region (SBSR). In exploring LNG-related knowledge and competence development patterns in the region concerned, the study has built upon the methodological framework generated for the analysis purposes to reflect LNG-related knowledge development capabilities, capacity of the LNG supply chain in the SBSR as well as existing and future LNGrelated bottlenecks and LNG-related potential. LNG-related knowledge and competence portfolio accumulated by the respective education, research, training and consulting institutions reveals which institutions and in which parts of the SBSR demonstrate high potential to be employed in the LNG-related activities, what capabilities the region are lacking, what are the opportunities for the science and academia in the SBSR and what challenges do they cope with. In enhancing the institutional dimension of the SBSR by the investigation of the maritime supply chains within the SBSR, the study outlines the evolving LNG value chain of the SBSR and its capabilities to handle LNG-related activities, such as LNG infrastructure, LNG-related products and services as well as relevant research projects. By bringing together knowledge development (scientific dimension) and knowledge absorption (business dimension) arrays the study aims at filling the void between science / academia and business. In exploring available science and business capabilities across the South Baltic Sea Region – Lithuania, Poland, Denmark, Germany and Sweden – the study advocates LNG as a sound business opportunity in the region. Observations gathered and discussed in this study may serve as an impetus for increasing LNG discussions in the business array. Opening-up of LNG activities in the regional parts manifesting moderate involvement into LNG-activities at the moment, or upswing of LNG-activities in those ones that have been already recorded in relevant LNG-related discourses would be promising results, which, in turn, would catalyse growing competences and capabilities all over the SBSR in terms of LNG. The study aims at mapping and evaluating LNG capacity in the region and the regional competences for an efficient establishment of the science and business network to support LNG infrastructure development in the South Baltic Sea Region. LNG is considered as a regulation-driven demand to comply with the environmental regulations enforced by the Sulphur Emission Control Area (SECA), as introduced by the International Maritime Organisation (IMO) Marpol Annex VI that generates additional costs to end-users of maritime transport and investments for ship owners and other related industries. To transfer this challenge into an opportunity, it is necessary that additional revenue generated by the regulations become as a source for the development and innovation for the regional maritime industries. This applies when LNG is used as a solution to comply with the environmental regulations. The emerging value chain will help to promote and develop LNG as a growth factor

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for the region’s maritime industry facilitating business partnerships and innovation, thus contributing to the EU Blue Growth Strategy.

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Introduction The EU cross-border project “MarTech LNG” carried out under the South Baltic Programme 2007-2013 aims at fostering LNG development in the whole South Baltic Sea Region (SBSR) and supporting the cooperation between the key stakeholders of the region concerned. Since the involvement and intertwining initiatives related to stakeholders representing the science side and stakeholders from the businesses have been addressed as one of the current drawbacks in some parts of the SBSR, initiatives undertaken in order to stimulate their cooperation, thus enabling knowledge and competence transfer as well as exchange of best practices among representatives from both science and business realms, are one of the key aims of the LNG knowledge and partnership platform. This platform that constitutes one of the core components of the MarTech LNG project results from further activities, the present joint LNG mapping study being one of the key contributors to this platform. Since the involvement and intertwining initiatives related to stakeholders representing the science side and stakeholders from the businesses have been addressed as one of the current drawbacks in some parts of the SBSR, initiatives undertaken in order to stimulate their cooperation, thus enabling knowledge and competence transfer as well as exchange of best practices among representatives from both science and business realms, are one of the key aims of the LNG knowledge and partnership platform. Against this background, the present Joint LNG Study contributes to one of the key project deliverables. The study emerged as a result of significant content inputs, communication and dissemination activities of all project partners and lead by the partner responsible for its implementation. Compiled and communicated to the LNG stakeholders and the public at large, this study provides with information on regional research and training institutions working in the LNG industry, promotes LNG experts in the whole region and technological solutions as well as proposals for the LNG development, enables acceleration of research and training services for maritime industries and boosting of company register reflecting LNG supply chain, thus generating networking platform for cooperation proposals and industry related tenders. More specifically, this joint LNG mapping study aims at communicating reasonable and useful information for all potential stakeholders dealing with LNG, namely, policy makers, regional and local authorities, companies, scientists, researchers, representatives from maritime and other industries as well as business stakeholders. The study can be regarded as point of departure or trigger to launch or deal with LNG-related initiatives and their practical implementation at a regional level. The study at hand focuses on the regions in the South Baltic Sea Region, i.e. Danish, German, Polish, Lithuanian and Swedish regions that due to geographical location and maritime proximity have declared their intentions to participate in the LNG activities.

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Fig. 1: South Baltic Sea Region with the participating project regions

Source: adopted from the South Baltic Programme 2007-20131

The study is built upon individual regional reports. Each individual report was compiled by the representatives of the regions, which are involved in the project. Nevertheless, since the project underscores the cross-border initiatives and LNG development in the whole SBSR, the data in the individual regional reports were analysed, compared and assessed. The key insights are reflected in this study. This study will be accompanied by the digital LNG knowledge and competence map, which embraces useful LNG-related information in a cartographic way. As a result, this study can be

1 South Baltic Programme 2007-2013, http://en.southbaltic.eu/files/?id_plik=1132, accessed on 22 April 2015.

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regarded as a new approach, since it gathers both science and businesses. The most valuable insights in the LNG context were gathered in terms of: §

Relevant science, research and consultation institutions across the SBSR and their potential to support regional and local businesses in LNG activities

§

Peculiarities of LNG supply chains in the SBSR

§

Key stakeholders from science and businesses

§

Primary interests of regional partners from SBSR in terms of LNG development

§

Greatest current and future challenges in terms of LNG to cope with.

The project team and the participating regions have recognised the environmental regulations and obligations put on the region’s ship owners and other related maritime stakeholders not as a challenge but rather as an opportunity to transfer the South Baltic Sea as a modal reducing the environmental impact and increasing competitive strength of the regional industry using LNG as a feasible alternative fuel in the maritime transport and LNG-related solutions as new business opportunities for the regional growth. LNG has been used as a solution to comply with the environmental regulations. The emerging value chain will help to promote and develop LNG as a growth factor for the region’s maritime industry facilitating business partnerships and innovation, thus contributing to the EU Blue Growth Strategy.

Wismar / Klaipeda, April 2015

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1

Methodological framework

When developing methodological framework for information gathering on LNG knowledge and competence within the framework of the MarTech LNG project, the focus has been laid on the South Baltic Sea Region (SBSR) and the participating project regions from Lithuania, Poland, Denmark, Germany and Sweden. Although the main emphasis has been put on the specific regions, as determined in the project and the South Baltic Programme, the light has been shed on relevant LNG activities on both local / regional and national levels. In this particular case, there has been seen a need to go beyond the boundaries of particular project regions for several reasons. First, due to the proximity of several involved stakeholders it appears to be reasonable to include stakeholders (institutions, business players and other actors and activities) across the borders of the clearly delimitated project regions, from areas adjacent to the project regions areas or thriving areas beyond these regions, since the identified stakeholders are significant for or can advance intense LNG activities to take place in the SBSR. Second, involving relevant stakeholders beyond the regional borders correspond with an attempt to exploit strong scientific, research and competence potential in the region as a baseline condition for effective academia and business collaborations in the SBSR. This thorough LNG study results from specification and analysis of three main realms: LNGrelated education, research, training, consulting and other relevant institutions – knowledge developing stakeholders or supply side (Component 1 “LNG Institutional Profile” in the framework below); stakeholders from LNG-related businesses, relevant industries and technologies, stakeholders involved into LNG infrastructure, products and services – knowledge absorbing stakeholders or demand side (Component 2 “LNG Value Chain”); LNG-related activities such as projects and initiatives (Component 3 “LNG Initiatives and Projects”). Analysis of the three realms, which, it may be stated here, implicate tangible (effective) activities, e.g. operating stakeholders, projects realised, products and services launched, etc. in the SBSR, is accomplished by two components (LNG-related future prospects and LNG-related challenges) that imply intangible (future-related) measures and activities. Taking into account knowledge absorbing stakeholders or demand side, this portfolio will be enhanced by pinpointing stakeholders in the SBSR who already record LNG solutions. Accordingly, these ones will be marked in the particular constellation with the MarTech LNG project logo. A blurry delineation of the components in terms of their scope and extent is reflected in the figure 1 on the methodological framework. Finally, when combined, the LNG study accumulates key knowledge, research, business performance competences and practices in terms of LNG and evolves into comprehensive LNG Knowledge and Competence Map. Therefore, in this manner the study gathers together both arrays science and business. Thus, it provides a solid overview of LNG-related topics and issues from two different perspectives: scientific and business. Beyond this, the present study reveals the extent to which the science and the

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businesses interface, the knowledge and competence respective institutions can develop and provide with and, in turn, the stakeholders that may demand and absorb it. From the business perspective, it reflects significant LNG competences, technology and knowledge. To give more detailed information on the content issues covered in this study, it follows the guideline for information gathering generated as a basis to provide scientific LNG knowledge and competence profile in the SBSR. As a result, by building upon the mentioned guideline and the observations above, the methodological framework can be presented in the following way. Fig. 2: Methodological framework

1. LNG institutional profile 4. LNG future prospects 2. LNG supply chain 5. LNG challenges

SBSR LNG knowledge & competence map + emerging LNG value chain

3. LNG initiatives and projects

Source: own draft

The joint LNG profile below is based on the regional LNG-related profiles provided by the representatives of the participating project regions. In this respect, the joint LNG study is therefore a result of a comparative analysis of individual regional profiles from Lithuania, Poland, Denmark, Germany and Sweden. The book in hand follows a descriptive and comparative analysis approach. Mainly, it is built upon the secondary literature analysis approach, provided that there have been used existing primary data or the information and data were gathered for the purposes of this study.

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2

Rationale behind the LNG technology in the South Baltic

Sea Region 2.1 Environmental framework conditions Greening of the European maritime transport to improve the environmental status of marine and maritime areas using environmentally-friendly low-carbon technological solutions or more “greener” fuels as Liquefied Natural Gas (LNG, methanol, etc.) to reduce air pollution and environmental implications are already in place or are being developed across the Baltic Sea Region (LNG small-scale terminals, LNG-driven vessels, LNG-powered energy supply, methanol-powered ferries, LNG-powered trucks, etc.). Environmental concerns have dramatically increased in all public and sectoral discourses in the last two decades revealing the need for maritime and other transport stakeholders to adapt to obligations as formulated by the regulators. Transport in Europe is constantly increasing as a result of intensifying globalisation and European exports and imports inland and overseas. A highest rate of goods is transported by means of sea-going ships. Fig. 3: Global maritime transport routes and transport density as a result of major trading economies

Source: J.-P. Rodrigue et al. (2013) The Geography of Transportation Systems.

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The value of EU-28 External Trade by Mode of Transport in 2012 by sea accounted for 49.1% of the exports and 53.7% of total imports according to the EU Transport in Figures: Statistical Pocketbook 2014 by the European Commission, p. 29). More than 42% of goods are transported on the European roads. This is a serious environmental concern: Road transport contributes about one-fifth of the EU's total emissions of carbon dioxide (CO2), the main greenhouse gas. CO2 emissions from road transport increased by nearly 23% between 1990 and 2010, and without the economic downturn growth could have been even bigger. Transport is the only major sector in the EU where Greenhouse Gas Emissions (GHG) are still rising. More than two thirds of transport-related GHG are from road transport. However, there are also significant emissions from the aviation and maritime sectors and these sectors are experiencing the fastest growth in emissions, meaning that policies to reduce the greenhouse gas emissions are required for a range of transport modes (Reducing emissions from transport, European Commission, 2012). Greenhouse gas emissions in other sectors decreased 15% between 1990 and 2007 but emissions from transport increased by 36% during the same period. This increase has happened despite improved vehicle efficiency because the amount of personal and freight transport has increased. Since 2008, greenhouse gas emissions from transport have started to decrease. Despite this trend, transport emissions were in 2012 still 20.5 % above 1990 levels and would need to fall by 67 % by 2050 in order to meet the 2011 Transport White Paper target reduction of 60% compared to 1990 (Reducing emissions from transport, European Commission, 2012). While shipping is in most cases more fuel-efficient than other transport sectors, its greenhouse gas emissions are substantial and growing fast. Without action, these emissions are expected to more than double by 2050, due to anticipated growth in the world economy and associated transport demand (European Commission, Time for international action on CO2 emissions from shipping, 2013). Emissions from maritime transport account for 3% of global greenhouse gas emissions today – equivalent to more than the total annual emissions of Germany – and this share is expected to rise to 5% by 2050. This is not compatible with the internationally agreed goal of keeping global warming below 2°C, which requires worldwide emissions to be at least halved from 1990 levels by 2050 (ibid.).

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Fig. 4: CO2 emissions projection from international shipping 1990-2050

Source: adopted from the European Commission2

The Commission's Transport 2050 Strategy as dated of 2011 aims to break EU transport’s dependence on oil and proposes a target of 60% greenhouse gas emissions reduction by 2050. It sets goals for the different modes of transport, including CO2-free city logistics in major urban centres by 2030, halving the use of conventionally fuelled cars in urban transport by 2030, and phasing them out in cities by 2050. It also envisages 40% CO2-low aviation fuels by 2050, and 40% CO2 emissions reduction from ships. These goals cannot be achieved with conventional fuels but require a big share of alternative fuels. According to the EU Transport GHG: Routes to 2050 II Project, freight rail and inland shipping generate lower GHG emissions in a time projection until 2050 as compared with other transport modes EU Transport GHG: Routes to 2050, 20112, p. 5). Nevertheless, it should be noted that according to the European Environment Agency, generation of emissions and air pollution by the sector delivers quite a similar view when comparing them in the evolutionary (historical) dimension and from a sectoral point of view. Based on the data available, it is clear that from historical perspective, the most polluters have been according to the data of the European Environment Agency manufacturing, construction and energy industries. Maritime transport is ranked on the last place. Nevertheless, these data

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European Commission, http://ec.europa.eu/clima/policies/transport/shipping/docs/marine_transport_en.pdf, accessed 20 April 2015. Based on data from the 2nd IMO GHG study 2009 for emissions until 2007; MEPC 63/INF 2 for average scenario projections 2010-2050.

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are presented on the European level, and as it was discussed previously, emissions and air pollution in a specific sector or a region might appear to be much higher as a result of clustering activities or geographical proximity. This is clearly apparent in Table 6. Fig. 5: Absolute change of emissions from 1990 till 2012: Sectoral GHG emissions by IPCC sector

Source: European Environment Agency3

Taking into account the distribution of emissions produced by the sectors, transport sector is the second largest polluter in terms of emission in Europe.

3

European Environment Agency, http://www.eea.europa.eu/data-and-maps/daviz/change-of-co2-eq-emissions#tabdashboard-01, accessed on 20 April 2015.

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Table 1: Emissions share per main sectors in 2012 Sector

1990

2012

Difference

1.A.1. Energy Industries

1676.232

1408.894

-267.338

1.A.5. Other (Not elsewhere specified)

28.761

9

-19.761

4. Agriculture

617.158

469.104

-148.054

International aviation

69.892

134.588

64.696

1.A.4. Other Sectors

820.725

679.257

-141.468

1.A.3. Transport

782.58

893.06

110.48

6. Waste

205.579

140.803

-64.776

International maritime transport

110.165

145.625

35.46

International Bunkers

180.057

280.213

100.156

1.A.2. Manufacturing Industries and Construction

860.513

533.06

-327.453

1.B. Fugitive Emissions from Fuels

155.779

80.513

-75.266

2. Industrial Processes - 3. Solvent and Other Product Use

478.932

330.533

-148.399

Source: European Environment Agency4

Although historically ships have been the main polluters in ports because the fuel they burn is high in greenhouse gas emissions (GHGs) (13.9% of the TOTAL navigation in 2012 according to the EC Transport figures), the pressure from regulators to use environmentally friendly fuels or low-carbon / low-sulphur fuels and technologies on ships, ports, transport infrastructures, etc. may significantly change this historical path. For example, most diesel cars emit on average 0.3 to 0.5% sulphur, whereas marine fuels were until recently capped at 4.5% (Review of Maritime Transport, 2014, UNCTAD, p. 72). This picture will change in 2020 through the IMO regulation under the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI. Indeed, already now there has been transformation with regard to reduce emissions. However, ships are mainly manoeuvred into position by tugs within the port and therefore ports have some control over the level at

4

European Environment Agency, http://www.eea.europa.eu/data-and-maps/daviz/change-of-co2-eq-emissions#tabdashboard-01, accessed on 20 April 2015.

25

which these contribute to the port’s carbon footprint. In areas where there is high concern about air pollution, ports have been investing in shore power to reduce the use of vessel fuel while at berth. As of the 1st January 2015, in the Baltic Sea, which is the Sulphur Control Area (SECA), the sulphur limit must not exceed 0.1%. Sulphur oxides (SOX), nitrous oxides (NOX), particulate matter (PM) and carbon dioxide (CO2) are emission components originating from combustion of marine fuels. They can severely damage ecosystems and human health. IMO MARPOL Annex VI defines a combination of general maximum global emission levels and more stringent emission limits applicable to designated Emission Control Areas (ECAs). Typical abatement alternatives include exhaust gas cleaning systems known as scrubbers for ships continuing to burn HFO; using LNG as a ship fuel; or switching to low-sulphur fuel when operating in an ECA. There are also new solutions emerging which either focus on avoiding sulphur from entering the engine or on removing SOX from the exhaust gas5. Burning of natural gas as compared to other fossil fuels, e.g. coal and petroleum, is likely to be cleaner in terms of SOX, NOX, PM and CO2 emissions, as it is shown in the following figure. Fig. 6: Comparison of emissions

Source: Durr et al, 20056

5

Maritime Impact 01-2015: Performance - Pushing limits, DNV, 2015, pp. 50-51.

6

C. Durr et al, 2005. LNG Technology for the Commercially Minded, http://www.kbr.com/Newsroom/Publications/Technical-Papers/LNG-Technology-for-the-Commercially-Minded.pdf, accessed 15 April 2015, p. 10.

26

Fig. 7: SECAs in Europe according to the MARPOL Annex VI

Source: adopted from DHL Freight7

7

Adopted from http://www.dhl-freight-connections.com/wp-content/uploads/2014/09/seca1.jpg, accessed on 20 April 2015.

27

According to the DNV, using LNG as fuel may reduce NOx emissions by approximately 90% on a lean burn gas fuelled engine, and the SOx and particulate matters emissions are eliminated. The CO2 emissions are about 20% lower because of the lower carbon content of LNG. Nevertheless, the issue of release of unburned methane from the engines still remains challenging in terms of environmental impact and should be focus in the next research and piloting projects. This is especially the case with 4-stroke duel fuel engines, as the GHG of methane is then between 20 and 25 times higher than CO28. With regard to the environmental concerns, LNG development in the region has been increasingly shaped by environment-related regulations to respond to the environmental concerns. With regard to the LNG field, there are regulations applicable on International, European and Regional level. The legislation on the international and European level is already in place to support development of sound alternatives in the maritime transport field and related infrastructure. The following table depicts the applicable regulations to support development of alternative fuels in the maritime sector as well as key institutions. Table 2: Legislative framework supporting shift to environmental-friendly solutions in the maritime field Level of Regulation

Applicable Regulation

MARPOL 73/78, International Convention for the Prevention of Pollution from Ships Annex IV: Prevention of pollution by sewage from ships

International

2003, 131 states / 90 % of world tonnage Annex V: Prevention of pollution by garbage from ships

Responsible Institution International Maritime Organisation (IMO)

Impact Level

IMO regulations are legally binding for all shipping companies at a global scale. Increasingly, EU introduces IMO regulations as a part of EU law. EU legal acts include regulations, which are directly legally binding, and directives, which must be included into the national laws.

1988, 144 states / 98% of world tonnage Annex VI: Prevention of air pollution

8

DNV Report Shipping 2020, http://www.dnv.nl/binaries/shipping%202020%20-%20final%20report_tcm141530559.pdf, accessed 20 April 2015, p. 9.

28

Level of Regulation

Applicable Regulation

Responsible Institution

Impact Level

from ships 2005, 72 states / 94% of world tonnage Paris Memorandum of Understanding (MOU)

Port State Control

SOLAS Convention 1974

International Maritime Organisation (IMO)

Guidelines for systems and installations for supply of LNG as fuel to ships by the International Association of Oil and Gas Producers (OGP) and the International Organisation of Standardisation (ISO) (cf. OGP Draft 118683).

International Association of Oil and Gas Producers (OGP) and the International Organisation of Standardisation (ISO)

IMO International Code for Safety for Ships Using Gases or Other Low Flashpoint Fuels (IGF Code) (draft).

International Maritime Organisation (IMO)

International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (IGC Code)

International Maritime Organisation (IMO)

EU Member States as members

Maritime sector stakeholders in the EU

EU Legislation (regulations and directives European Commission European

Clean Power for Transport A European Alternative Fuel Strategy (COM (2013).

European Parliament Council of the European Union

Applicable on Member States of the EU Baltic Sea Region

EU Clean Fuel Strategy The Commission's Transport 2050

29

Level of Regulation

Applicable Regulation

Responsible Institution

Impact Level

Strategy Actions towards a comprehensive EU framework on LNG for shipping 2013, Commission Staff Working Document. Directive 2014/94/EU of the European Parliament and of the Council of 22 October 2014 on the deployment of alternative fuels infrastructure – clear focus and need on LNG / LPG also in intermodal transport. Directive 2009/30/EC of the European Parliament and of the Council of 23 April 2009 amending Directive 98/70/EC as regards the specification of petrol, diesel and gas-oil and introducing a mechanism to monitor and reduce greenhouse gas emissions and amending Council Directive 1999/32/EC as regards the specification of fuel used by inland waterway vessels and repealing Directive 93/12/EEC. Directive 2014/89/ EU as o 23.07.2014 establishing A Framework of Maritime Spatial Planning incl. its proposal on reducing local harbour emissions and air pollutions from ships. Directive 1999/32/EC amended with the Directive 2012/33/EU relating to a reduction in the sulphur content – in 2020 the sulphur limit must be brought down to 0.5% outside sulphur emission control areas (SECAs) and to 0.1% in SECAs. Commission Directive 2012/46/EU of

30

Level of Regulation

Applicable Regulation

Responsible Institution

Impact Level

6 December 2012 amending Directive 97/68/EC on the approximation of the laws of the Member States relating to measures against the emission of gaseous and particulate pollutants from internal combustion engines to be installed in non-road mobile machinery. Article 1, EU Water Framework Directive, 2000 on progressive reduction of emissions. EU Marine Strategy Framework Directive, 2008 incl. Annex I (environmental status). Roadmap for moving to a low-carbon economy in 2050 (COM (2011). EC Transport White Paper Goals (2011): By 2050, connect all core network airports to the rail network, preferably high-speed; ensure that all core seaports are sufficiently connected to the rail freight and, where possible, inland waterway system. EU 2020 Strategy – resource-efficient Europe. The Europe 2020 strategy aims at smart, sustainable and inclusive growth. It includes five objectives on employment, innovation, education, social inclusion and climate change / energy to be reached by 2020. The reduction targets in the field of climate change and energy are: §

To reduce greenhouse gases (GHGs) by 20% compared to 1990

31

Level of Regulation

Applicable Regulation

§ §

Responsible Institution

Impact Level

To improve energy efficiency by 20% To increase the share of renewables in final energy consumption to 20%

Trans-European Transport Network, TEN-T aims for a more sustainable EU transport system MarcroRegional

HELCOM Recommendations and papers

Helsinki Commission – HELCOM: Within the Baltic Sea region, HELCOM recommendations are usually implemented as part of national legislation.

Baltic Sea Region; Members of the EU

National / regional

Regulations, standards and procedures applicable on handling LNG

Land-side: Transport institutions; regional / local ministries and administrations; fire fighting institutions; police, etc.

Regulations on handling LNG on national level are not harmonised. The procedures are stipulated on the principal case-basis.

Sea-side: Maritime authorities Source: own draft based on the research results

With regard to the environmental regulations, which came into force to improve the environmental status of marine and maritime areas in the EU and globally, LNG handling standardisation is, however, not clearly harmonised on international and national levels. Nevertheless, there are existing proven standards, e.g. ISO, etc. issued by the international institutions on LNG fuelling and treatment, etc. The following table displays the overview of LNG bunkering regulations and procedures available today.

32

Table 3: LNG handling related regulations and standards Regulation domain

Onshore regulations

Bunkering regulations

Overview: 18 bunkering regulations

Relevant existing bunkering regulation §

LNG bunker station

§

Risk analysis procedure for LNG bunker stations

§

LNG bunkering definition

§

LNG bunkering procedures (STS, TTS, PTS)

§

LNG bunker port operations

§

LNG bunkering safety distance

§

LNG bunkering risk assessment

§

LNG environmental requirements

Regulation status

NO

NO

1 of 18 bunkering regulations is internationally regulated: “LNG fuel transfer systems ISO 28460”

Bearing in mind the overview of the LNG-related regulatory framework, it can be stated that there is a critical gap identified within the international standardisation regarding LNG use and application. Although there exist a reasonable number of international standards in terms of waterborne LNG supply, waterborne LNG transport and supply facilities (cf. Appendix 15.1 of the Study on Standards and Rules for bunkering of gas-fuelled ships9), most of the internationally binding standards and rules directly referring to LNG bunkering operations remain internationally not regulated or are subject to further development. Today, initiatives Europe and worldwide, particularly, in the Modal Region of the Baltic Sea, are facilitated by international, European and national regulations. A comprehensive analysis of the applicable legislative basis applicable in the Baltic Sea has resulted in the regulative framework presented. Indeed, this framework is not seen as a obstacle to maritime and other transport stakeholders in the Baltic Sea within this project, but rather as a source to adapt the proven solutions to the technological progress or to develop new sound solutions in the navigation and other transport sectors.

9

European Maritime Safety Agency: Publications and documents, 2014.

33

2.2 Economic framework conditions From the economic perspective, LNG developments in the Baltic Sea Region are driven by the following factors: §

Increase of new natural gas resources in geographically distant regions from Europe (e.g. USA, Canada, etc.).

§

LNG transportation costs compared with delivery via pipelines and onshore.

§

Price development of LNG as a fuel for maritime transport.

§

Increasing demand for natural gas in the maritime and other sectors located a long way from the original natural gas sources.

§

Impact of using LNG to comply with the international, European and regional regulations and directives regarding environmental status and impact reduction on environment from transport.

In terms of LNG transportation costs, LNG bears an opportunity for maritime transport stakeholders to be introduced. Furthermore, due to creation of LNG value chain, the distribution of LNG on the market and other industry sectors appears to be feasible. Advantages of LNG introduction and thus economic framework conditions are shaped by the following factors. LNG demand will undergo a constant grow according to the international observations. According to the World Energy Outlook (WEO 2002), published every two years by the International Energy Agency – IEA, gas use will double from 2547 109 m3 in 2001 to 5047 109 m3 in 2030. Demand increases most rapidly in the fledgling markets of developing Asia, notably China, and in Latin America. However, by drawing on the OECD observation, North America, OECD Europe, and the Former Soviet Union (FSU) remain by far the largest markets in 2030. These three groups will account for 63% of gas demand in 2030, compared with 74.4% in 200110.

10

The Challenges of Further Cost Reduction for New Supply Options (Pipeline, LNG, GTL), 22nd World Gas Conference Tokyo, 2003, http://www.dma.dk/themes/LNGinfrastructureproject/Documents/Infrastructure/IEAThe%20challenges%20of%20further%20cost%20red%20new%20supply%20options.pdf, accessed 20 April 2015, p. 2.

34

Fig. 8: World primary energy demand by fuel 1980 to 2035

Source: International Energy Agency’s core scenario11

The demand will be affected by the increasing world population and the need for electricity. Furthermore, growing industries are highly dependant on energy sources, particularly, from gas reserves, since coal production might be not sufficient with regard to the growing demand, although it has been highly prioritised on the ranking list. Nevertheless, in the Baltic Sea, and in Europe, with regard to the environmental regulations, there shift towards more friendlier and less polluting fuels should be made in the next future when taking into account the negative effects on the environment.

11

Adopted from http://www.minerals.org.au/resources/coal/coal_bringing_power_to_the_people, accessed 23 April 2015.

35

Fig. 9: Natural gas consumption per capita, 2013

Source: BP Statistical Review of World Energy 201412

Furthermore, LNG will be demanded as a response to introduce clean and efficient technology (as a result of environmental regulations), increased electric efficiency and reduction of costs. This is especially the case in Europe with regard to the introduced Blue Growth Strategy and other strategies and papers facilitating environmentally friendly, high-technological and sustainable development. With regard to Europe, the EU calls for introduction of alternative marine fuels for shipping. This is especially a vital concern for the Baltic Sea, where the shipping is very intensive. According to the Commission Staff Working Document, around 10.000 ships are currently mainly used for European Short Sea Shipping, of which around 5.000 are spending more than 50% of their time in SECAs, thus having to use mainly low sulphur marine gasoil13.

12

Adopted from BP, 2014, http://www.bp.com/content/dam/bp/images/other/Energy-economics/stats-review2014/Natural-gas-consumption-per-capital-2014-bp.jpg, accessed 23 April 2015.

13

COMMISSION STAFF WORKING DOCUMENT Actions towards a comprehensive EU framework on LNG for shipping, http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:52013SC0004, accessed 15 April 2015.

36

Fig. 10: Container shipping in the Baltic Sea

Source: Baltic Transport Maps14

The Baltic Sea is highly frequented as a result of intensifying trade between the Baltic Sea regions as well as regions, which are corridors to the EU trade partners outside the EU as well as overseas regions. As it is demonstrated in the following figures, the Baltic Sea, which is the SECA, is highly frequented by both container ships, Ro-Ro and passenger ferries.

14

Adopted from Baltic Transport Maps, http://www.baltictransportmaps.com/contmap.html#?z=2.2&x=52&y=315.65, accessed 13 April 2015.

37

Fig. 11: Ro-Ro and passenger ferries traffic in the Baltic Sea

Source: Baltic Transport Maps15

Taking the transport and trades flows in the Baltic Sea and via the Baltic Sea, it can be stated that the introduction of alternative fuel like LNG will be benefit the ecosystem of the Baltic Sea by reducing the negative impacts on the environment.

15

Adopted from Baltic Transport Maps, http://www.baltictransportmaps.com/rofemap.html#?z=2.2&x=0&y=0, accessed 13 April 2015.

38

On the supply side, LNG development is driven by gas reserves, which can be exploited in a more efficient way, or the new ones. Important factor is that gas reserves are distributed over the regions instead of accumulation in one or two regions, as compared with, e.g. oil. However, also here a few regions dominate the gas distribution globally and regionally. Fig. 12: Recoverable natural gas reserves 2011 in trillion cubic meters

Source: IEA, BP, Reuters16

With regard to new technologies in the field of natural gas exploitation, a new trend of claiming natural gas is so-called shale gas and its exploitation. This new shale gas exploitation enables shifting of gas distributions worldwide as well as might affect natural gas costs, transportation costs and ease of access, etc.

16

Adopted from http://www.siluria.com/sandbox_demo_jlyl74/admin/kcfinder/upload/images/natGas3.jpg, accessed 23 April 2015.

39

Fig. 13: Natural shale gas basins

Source: EIA, BP17

LNG trade is further driven by the LNG price development and flexibility in terms of its transportation. In terms of prices, due to shale gas exploitation, which has strongly increased in the last years, LNG price underwent decrease due to stronger competition for other key gas exporters worldwide. Nevertheless, the new extractions process remains highly controversial in terms of public acceptance as well as examination of air and water quality after the shale gas exploitation and risks for human health. In this sense, there is also a need for more environmentally friendly extraction technologies and increasing public acceptance. Due to increasing LNG supply and projects globally, several regions will compete for LNG in the next future. However, the LNG price on the market is hardly to be predicted and specific forecasts to be made, as compared to oil price drop, which occurred by the end of 2014.

17

Adopted from https://worldpittsburgh.files.wordpress.com/2014/01/global-shale-gas-basins.jpg, accessed 20 April 2015.

40

There are many factors to be taken into account when making forecast for LNG price development, and especially, for LNG feasibility and development in Europe and across the Baltic Sea. LNG development is likely to be economically viable solution, as transportation of natural gas is related to economic and technological flexibility. For example, transportation of natural gas via pipelines is restricted to geographical distance. Since, as it was previously mentioned, emerging LNG sites have been discovered overseas, LNG transportation via pipelines becomes more restricted. Most convenient is transportation of gas via pipelines, if the distance is short. According to the economic calculations, pipeline versus LNG transport economics break even at approximately 3.200 km onshore and 1.600 km for offshore. At distances greater than these LNG is usually more attractive economically18. This is clearly depicted in the following figure. Fig. 14: Comparison of natural gas transportation cost

Source: Durr et al, 200519

New emerging LNG markets overseas (USA, Canada, South America, etc.) currently and in the next years will face their limits of export capacity do to over-supply of natural gas based on exploitation of new reserves. For this, in order to sustain their competitiveness, key natural gas

18

C. Durr et al, 2005. LNG Technology for the Commercially Minded, http://www.kbr.com/Newsroom/Publications/Technical-Papers/LNG-Technology-for-the-Commercially-Minded.pdf, accessed 15 April 2015, p. 3.

19

Ibid., p. 3.

41

exporting countries have to shift to new solutions. Transporting of natural gas in a compressed form (liquefied natural gas) bears a feasible solution. The new importing countries, mostly emerging countries, located far from the pipeline networks, seek supplies adapted to their highly localised and fast growing needs. LNG as a maritime option with excellent modularity and progressiveness in project capacity is likely to fit adequately this requirement20. Further, transportation via LNG carriers than pipelines ensures flexibility in terms of national / regional security, as countries / regions remain not subject to isolation in terms of political tension when the gas is delivered directly to the national / regional ports and distributed via the established infrastructure. Similar as to the security issue, delivery of gas via LNG carriers to the ports and maritime international, national and inland waterways enables to overcome borders and thus facilitate the European understanding of borderless regional development in the EU. Thus, geographical (e.g. no accessibility to gas due to unfavourable geographical conditions, such as mountains, remote location or similar) and political boundaries do not place constraints any longer to gain access to gas and in this way ensure the coverage of demand for gas needed for industry and public consumption, such as electricity, heating, etc. Finally, increasing diversification of LNG applications, not only used as a marine fuel, but as a source employed in producing industry, automobile, port infrastructure equipment, onshore power supply, etc. will simultaneously accelerate the demand for LNG integration in Europe. From introducing LNG as a marine fuel to reduce environmental impact towards employment of LNG in other fields, such as automobile and public transport, there can be achieved multiplier effects to improve the environmental status across regions in Europe and to contribute to the more sustainable transport system across the Baltic Sea and Europe.

2.3 Technological framework conditions In terms of the technological progress related to the introduction of LNG technologies worldwide and in the Baltic Sea, it is driven by the following factors:

20

The Challenges of Further Cost Reduction for New Supply Options (Pipeline, LNG, GTL), 22nd World Gas Conference Tokyo, 2003, http://www.dma.dk/themes/LNGinfrastructureproject/Documents/Infrastructure/IEAThe%20challenges%20of%20further%20cost%20red%20new%20supply%20options.pdf, accessed 20 April 2015, p. 3.

42

§

Increasing number of solutions (LNG-powered engines) in ships.

§

IMO Regulations in terms of energy efficiency and CO2 reduction technologies.

§

Emerging large-scale LNG liquefaction facilities (LNG trains, floating LNG facilities, etc.)

§

LNG integration in new ships’ building with duel engines.

§

Retrofitting existing ships to use LNG as a fuel.

§

Increasing application of LNG in the land-based solutions, e.g. onshore power supply.

In terms of technological progress in shipbuilding powered by LNG, according to the DNV data 2014, there are currently 50 LNG-powered ships operating excluding LNG carriers and additional 69 new building orders have been registered. LNG-driven ships are nevertheless subject to higher capital costs of the system installation21. The comparison of the ships operating and ordered according to the vessel segment and areas of operation are depicted in the following figures. Fig. 15: LNG powered ships in operation

Source: DNV GL, 201422

When compared the LNG driven vessels operating by 2014 and new orders, there is a clear trend towards increasing LNG applications in Europe and North America. This can be again traced back to the environmental regulations and introduction of SECAS by the IMO.

21

DNV GL, 2014, LNG as Ship Fuel, https://www.dnvgl.com/Images/LNG_report_2015-01_web_tcm8-13833.pdf, accessed 17 April 2015, p. 9.

22

Adopted from Ibid., p. 48.

43

Fig. 16: LNG powered ships ordered

Source: DNV GL, 201423

In terms of technological progress, international institutions, such as IMO, are placing obligations to stakeholders from the shipping industry to contribute reduction of environmental impacts by introducing more energy efficient technologies benchmarked against technical measure, would it be duel fuel engine, pure LNG engine, etc. Such benchmarking and endeavours to increase efficiency of energy used on the vessels and to reduce environmental impact simultaneously, finds its roots in the IMO regions adopted in terms of CO2 in 2011. These regulations refer to the Energy Efficiency Design Index (EEDI) and the Ship Energy Efficiency Management Plan (SEEMP), which entered into force on the 1st of January 2013. Based on these regulations, new stricter requirements apply to new ships stimulating development of more energy efficient ship designs, thus reducing operational CO2 / GHG emissions as well as more energy efficient operational practices. Energy efficiency

23

Adopted from Ibid., p. 47.

44

measures are different from other emission abatement technologies as they fulfil two purposes: they reduce fuel consumption and not emission directly, and they are (potentially) cost effective24. The ranking of LNG technology in ships is depicted in the following figure. Fig. 17: Measures of technologies in ships according Energy Efficiency

Source: DNV GL, 201425

With regard to increasing LNG deployment, LNG introduction in the Baltic Sea and Europe is highly driven by economies of scale. Such factors as new emerging large-scale LNG projects and liquefaction plants consisting of one or two trains allows greater supply of LNG for the market. Furthermore, due to technological progress, LNG plans are being established in the sea, socalled floating LNG plants. There has been introduced to the market the possibility to run LNG

24

DNV Report Shipping 2020, http://www.dnv.nl/binaries/shipping%202020%20-%20final%20report_tcm141530559.pdf, accessed 20 April 2015, p. 22.

25

Adopted from Ibid., p. 23.

45

terminals in the form of floating LNG facilities, e.g. Floating Storage and Regasification Unit (FSRU) in Klaipeda, Lithuania. The LNG technology, however, is constantly subject to improvements regarding the safety, operational capabilities, security of the public, critical infrastructure, public acceptance, harmonisation of safety and bunkering standards, risk assessment and LNG handing procedures. With regard to increasing cohesion on the European level facilitated by the respective European policy strategies, LNG application becomes possible. In the Baltic Sea, technological solutions in terms of LNG are emerging. Engine manufacturers are increasingly bringing to engines to the market, such as gas engines or duel fuel engines, which have been installed in the Ro-Ro vessels or ferries. In terms of new shipbuilding, ship owners are likely to introduce LNG-driven engines as a result of environmental obligations, especially, when operating in the Baltic Sea and other neighbouring SECAs (North Sea and the English Channel), or even overseas (e.g. coastal maritime regions of North America, see SECAS map in figure 7). As a result of increasing obligations placed on shipping operators in the SECAs, there has been observed an increasing number of projects on retrofitting the existing ships, e.g. in North Germany, retrofit of ferries running in the North Sea. Furthermore, due to emerging LNG infrastructure in Baltic Sea Ports, there has increased diversification possibilities to open up the LNG market having its roots in the Baltic Sea in the maritime field. Based on the established LNG infrastructure (terminals or bunker facilities) at seaports, introduction of LNG becomes possible in the hinterland locations. Automobile industry including inland shipping has increasing researching and piloting LNG applications. Table 4: EU measures to be implemented for clean power for transport Measure

Coverage

Timing

Electricity in urban/suburban and other densely populated areas

Appropriate number of publically accessible points

by end 2020

CNG in urban/suburban and other densely populated areas

Appropriate number of points

by end 2020

CNG along the TEN-T core network

Appropriate number of points

by end 2025

Electricity at shore-side

Ports of the TEN-T core network and other ports

by end 2025

Hydrogen in the Member States who

Appropriate number of points

by end 2025

46

Measure

Coverage

Timing

LNG at maritime ports

Ports of the TEN-T core network

by end 2025

LNG at inland ports

Ports of the TEN-T core network

by end 2030

LNG for heavy-duty vehicles

Appropriate number of points along the TEN-T core network

by end 2025

choose to develop it

Source: European Commission, Transport26

In this light, the EU cohesion policy may serve as a driving force to diversify LNG application in the transport sector. With the introduction of the Trans-European Transport Network (TENT), Europe aims at developing sustainable transport system.

26

Adopted from European Commission, Clean Power for Transport – Alternative fuels for sustainable mobility in Europe, 2014, http://ec.europa.eu/transport/themes/urban/cpt/index_en.htm, accessed 20 April 2015.

47

Fig. 18: TEN-T core network corridors Europe

Source: European Commission27

Environmentally friendly transport should be achieved by establishing and promoting cleaner transport modes, among other priorities. LNG introduction in maritime, inland ports as well as for heavy-duty vehicles along the TEN-T network is stipulated in the respective EU regulations. Important in this context are overcoming of borders and removing bottlenecks along the indicated nine corridors. The established corridor system may increasingly advance LNG application along the trans-European corridors and transfer LNG applications from the maritime sector towards other transport and industry applications in other European regions.

27

Adopted from http://www.bluecorridor.org/ngvs/natural-gas-industry/eu-works-strategy-roll-alternative-fuel-forvehicles-infrastructure/attachment/schematica0_eucorridor_map/, accessed 15 April 2015.

48

3

LNG-related research and training institutional profile

The chapter in hand generates the institutional dimension (institutional profile). More specifically, by identifying and specifying all relevant regional institutions involved in LNG-related activities, the chapter unveils the institutional capabilities of the region. The discussion starts by embracing the overall institutional dimension in the region concerned, then it turns to the determination of the institutions. Afterwards, the light is shed on the precise scope and extent of knowledge and competences the institutions bring with, their key activities and the cooperation patterns. The institutional profile is finalised by challenges or bottlenecks faced by the academia and in the business discourses related to LNG scientific activities.

3.1 Identifying relevant institutions With regard to the region in question, there have been located several institutions either dealing with the LNG issues or yielding activities that due to their scope encompass strong potential to be integrated into the respective LNG-related discourses. Based on the examination of individual regional institutional profiles, there have been realised diverse types of the institutions, with four key groups of institutions constituting the institutional dimension in the SBSR: Fig. 19: South Baltic Sea Region institutional profile

Source: own draft.

49

For the research and project purposes, there were identified 161 institutions across the SBSR, which demonstrate high involvement into LNG-related activities. When comparing the distribution of the identified institutions in terms of specified four institutions groups, there might be argued that these four groups of institutions are nearly equally spread over the region. At a closer look, research and training institutions yield the same scope and rank slightly higher than consulting and education institutions. A graphic distribution is shown in the following figure. Fig. 20: Institutional portfolio in the South Baltic Sea Region

Source: own draft, based on regional profile data

To particularise the identified research, the following delineation has been generated: Table 5: Research institutions in the South Baltic Sea Region Location in the SBSR

Research institutions Klaipeda University 2 Institutes Coastal Research and Planning Institute (CORPI) Maritime Study Institute

50

Location in the SBSR

Research institutions 4 Laboratories Marine Ecosystems Marine Chemistry Air pollution from the ships research laboratory Reliability of structures Klaipeda Shipping Research Centre Lithuanian Institute of Energetics SGS Klaipeda Ltd, UAB Klaipeda Science and Technology Park Wismar University 3 Departments Department of Maritime Studies Department of Mechanical Engineering Wismar Business School 2 Institutes Maritime Institute Warnemünde e. V. ISSIMS – Institute for Maritime Theory, Simulation and Maritime Systems FGW – Forschungs-GmbH Wismar MATVAV – Institute for Maritime Automation Technology and Navigation e. V. Institute for Safety Technology / Ship’s Safety e. V. Rostock-Warnemünde University of Rostock

51

Location in the SBSR

Research institutions Schweißtechnische Lehr- und VersuchsanstaltMecklenburg-Vorpommern GmbH Rostock Fraunhofer Application Centre for Large Structures in Production Engineering IMAVIS – Maritime Wirtschafts- und Schiffbauforschung GmbH Rostock Economics and Technology Academy GmbH Rostock-Warnemünde Baltic Marine Consult GmbH Rostock-Warnemünde Economics and Technology Academy GmbH Rostock-Warnemünde Baltic Energy Forum e. V. Mallentin University of Aalborg 1 Department Department for Technique, Construction and Development University of Aarhus 2 Departments Department of Economics and Business Department of Mathematics – Science Studies National Environmental Research Institute DTU – Technical University of Denmark 3 Departments DTU Mechanics DTU Transport DTU Chemical & Biochemical Engineering Roskilde University Department of Environmental, Social and Spatial Change

52

Location in the SBSR

Research institutions Danish Centre for Maritime Technology FORCE Technology Maritime University of Szczecin MarCore Group Danish Technological Institute Gdynia Maritime University Maritime Institute in Gdansk West Pomeranian University of Technology Szczecin Koszalin University of Technology Maritime University of Szczecin Gdansk University of Technology Baltic Marine Surveyors Gdynia Chalmers University Blekinge Institute of Technology World Maritime University of Malmö SP Technical Research Institute of Sweden SSPA AB Linnaeus University

53

Location in the SBSR

Research institutions Department Maritime Academy University of Gothenburg Logistics and Transport Economics AGA Gas AB Swedish Gas Association

Source: based on regional profile data

Regarding the distribution of research and training institutions across the SBSR, all involved regions yield quite similar distribution of these particular institutions. Whereas the eastern part of the SBSR with Lithuanian and Polish regions record an equal number of research institutions, the number of these institutions in the German region is slightly higher. The Danish and Swedish regions yield each the same number of institutions and lag slightly behind the rest of the SBSR regions. With regard to training institutions, the regional coverage is the following: Table 6: Training institutions in the South Baltic Sea Region Location in the SBSR

Training institutions Lithuanian Maritime Academy Klaipeda University Klaipeda Shipping and Research Centre Klaipeda Science and Technology Park Novikontas SCM, UAB Sabelija, UAB Saugalita, UAB DNV GL

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Location in the SBSR

Training institutions Maritime Education and Training Centre Rostock-Warnemünde Maritime Institute Warnemünde e. V. Maritime Simulation Centre Rostock European Cruise Academy Rostock Marinesoft GmbH Rostock Schweißtechnische Lehr- und VersuchsanstaltMecklenburg-Vorpommern GmbH Rostock DNV GL MARTEC – Maritime and Polytechnic College Marstal School of Navigation FORCE Technology Maritime Development Center of Europe Maersk Training Oil & Gas Maritime University of Szczecin 4 Centres Marine English Centre Marine Officers’ Training Centre Marine Rescue Training Centre Marine Training Centre Gdynia Maritime University

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Location in the SBSR

Training institutions Maritime Training Centre “Zenit” Szczecin Ship Handling Research and Training Centre Iława Bernhard Schulte Ship management Poland Chalmers University Linnaeus University World Maritime University of Malmö Kalmar Maritime Academy Blekinge Institute of Technology SGS Sweden AB LNG-Safety Sweden

Source: based on regional profile data

Beyond this, in terms of several identified institutions, it might be worth mentioning that some of them are simultaneously involved, for instance, into research and training activities. Therefore, such institutions can be ascribed to different typologies, as has been, for example, the case of FORCE Technology (DK). Hence, the overlaps cannot be excluded in this particular case. Turning now to the bundle of training institutions, it is apparent that the region reveals strong competences in providing training in terms of LNG transportation, navigation, marine engineering, etc., thus meeting the potential requirements from diverse LNG-related businesses and, in turn, the demand from the business side. As it has been highlighted in the table above, the highest potential lies in Lithuanian, Polish and German regions followed by equal number of training institutions in Denmark and Sweden, it would be accurate to mention further training institutions. Looking at the breakdown of other types of the institutions, the third highest ranking in the SBSR demonstrate consulting institutions. Here, the highest capabilities can be ascribed to the

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Lithuanian and Polish regions, each with 6 consulting institutions. Taking a closer look at other project regions, the Danish, German and Swedish regions yield each 5 consulting institutions and are followed by Poland with 3 institutions involved into consultation activities, respectively. Nevertheless, in this particular case, there is apparent correlation either with the research or education institutions. The overall distribution of consulting institutions in the SBSR is the following: Table 7: Consulting institutions in the South Baltic Sea Region Location in the SBSR

Consulting institutions DNV GL Klaipeda Science and Technology Park Novikontas SCM, UAB Association “Baltic Valley” Klaipeda Shipping Research Centre Klaipeda University Lithuanian Energy Institute Coastal Research and Planning Institute (CORPI) SWECO Lietuva Bureau Veritas Klaipeda FGW – Forschungs-GmbH Wismar ATI erc gGmbH ATI Küste GmbH IMAVIS Maritime Wirtschafts- und Schiffbauforschung GmbH

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Location in the SBSR

Consulting institutions Marinesoft – Entwicklungs- und Logistikgesellschaft mbH German Association for Positioning and Navigation e.V. BSH – Federal Maritime and Hydrographic Agency CPL Competence in Ports and Logistics Lloyd´s Register EMEA Rostock Hamburg Marine Business Development (CEA) Lloyd’s Register Marine Hamburg MvB euroconsult Admannshagen DNV GL Rambøll Bureau Veritas Schwerin Maritime Cluster Northern Germany Baltic Marine Consult GmbH Rostock-Warnemünde Gothenburg Energy FKAB Marine Design DNV GL White Smoke AB

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Location in the SBSR

Consulting institutions SSPA AB Swedish Maritime Forum Swedish Gas Association ÅF Consult AB Lloyd’s Register EMEA Swedish Maritime Technology Forum SGS Sweden AB DAMCO SURVEY AB Bureau Veritas Maersk Maritime Technology DNV GL Force Technology Danish Gas Technology Centre Gromij A/S Rambøll Oil & Gas Lloyds List Intelligence Bureau Veritas

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Location in the SBSR

Consulting institutions KNUD E. HANSEN: Naval Architects and Consulting A/S MarCore Consult TIN Marine Consult DNV GL Polish Register of Shipping (PRS) SGS Polska Sp.z o.o. Bureau Veritas Baltic Marine Surveyors Gdynia BMT Maritime Consultants Sp zoo Gdansk Navitech Gdynia Sp. z o.o. M. J. Zaczek Marine Consultants & Surveyors Gdynia JG-Marine Gdynia & Gdansk / Szczecin / Swinoujscie Independent Claims Surveyors Polska Sp. z o.o. Gdynia / Szczecin Choren Design & Consulting Gdansk

Source: based on regional profile data

When dealing with education institutions, from the material gathered, it is apparent that these ones reveal the lowest records within the SBSR institutional profile. The Lithuanian, Swedish and Polish data yielded two key education institutions in each of these particular regions. Outstanding in this sense appears to be the education institutional environment in the Danish and German regions concerned, where each of them reveals 5 potential education institutions able to develop and transfer LNG-relevant knowledge and competence for the respective LNG

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activities. As a result, the following constellation of the education institutions in the SBSR has been proposed: Table 8: Education institutions in the South Baltic Sea Region Location in the SBSR

Education institutions DTU – Technical University of Denmark Aalborg University University of Aarhus Roskilde University MARTEC – Maritime and Polytechnic College Marstal School of Navigation FORCE Technology Wismar University of Applied Sciences Maritime Simulation Centre Rostock-Warnemünde Navigation School Rostock-Warnemünde European Cruise Academy University of Rostock Maritime University of Szczecin Gdansk University of Technology Gdynia Maritime University

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Location in the SBSR

Education institutions Klaipeda University Lithuanian Maritime Academy Klaipeda Maritime College Linnaeus University World Maritime University of Malmö Kalmar Maritime Academy University of Gothenburg Logistics and Transport Economics Blekinge Institute of Technology Chalmers University

Source: based on regional profile data

By drawing on the observations gathered, it might be argued that the SBSR does reveal strong competence in providing businesses with the LNG-relevant knowledge. Especially, research, training and consulting institutions yield sound command in LNG-based initiatives. Research activities in terms of LNG are of significant relevance, since they can contribute to the emergence of innovations related to LNG, pursue relevant science and research projects, e. g. when reasoning the practical application of LNG to the maritime businesses or dealing with the challenges faced by respective businesses. Dovetailed with competences of education institutions, research activities may significantly contribute in catalysing activities in the business environment. What is lacking here, it may be argued, synergy effects between these respective institutions across the SBSR, thus leading towards the increased capabilities to establish LNG business climate in the SBSR. Besides, a substantial number of consulting institutions identified so far imply that the SBSR possesses intermediaries who in this particular case could induce more cross-linking and fill the void between the science and the business what, in turn, appears to be needed when dealing with the topical LNG issues. Despite this fact it can be underscored that the institutional shape or portfolio within the SBSR, when bringing together research, education,

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training and consulting institutions, tends to be equally distributed and therefore is plausible to make significant contribution to the LNG-related activities. Against this background it should be hinted at the fact that the scope of the SBSR institutional profile may expand due to several conditions. First, as has been mentioned in the methodological approach of this study, the core focus for the analysis has been laid on the regions eligible for the South Baltic Region. Thus, knowledge generation institutions in terms of LNG in the adjacent South Baltic regions, especially in case of German regions, such as Hamburg, were not subject for framing up this institutional profile. Second, due to the fact that LNG is gaining more resonance in scientific, economic and public discourses, the emergence of activities related to LNG cannot be excluded in the institutions not covered by this chapter. Taken together, the observations of the institutional shape in the SBSR suggest that research in the region has been highly driven by investments. Lithuanian and Poland demonstrate a significant number of research institutions as a result of infrastructural projects that have been conducted in these particular regions. Indications in the MarTech LNG project are clear as well pointing to the fact that infrastructural development catalyses possibilities for specialisation, and all respective competence gathered in the frame of the regional projects may be maintained and developed for the purpose to provide the breeding grounds for the evolvement of services that are capable to compete in foreseen markets and projects.

3.2 Specification of LNG-related knowledge & competence potential Regarding the extent and scope of competences and knowledge particular institutions of the SBSR bring with them, it can be emphasised that the institutions of the SBSR, as identified above, reveal respective competences in both: activities directly related to the LNG (1) as well as LNG-related (2) and maritime-base (3) activities. In terms of direct LNG activities, a special position in this respect take the institutions situated in Poland. To exemplify, the majority of the Polish institutions are involved into providing knowledge and competences into the LNG activities, i.e. Szczecin Maritime University is equipped with the LNG and LCH Simulation Centre as well as offers post-graduate studies “LNG Transport and Terminal Operation” and Basic LNG course. The Bernhard Schulte Ship Management (LNG Cargo Handling Simulator Training Courses) and Gdynia Maritime School (Liquid Cargo Handling Simulator Trainings and courses in advanced liquefied gas tanker operations) possess similar competences. Besides, some of the institutions providing direct LNG activities are located in the Danish region, e.g. FORCE Technology offering modelling of LNG carries and developing of advanced mathematical models for LNG carries, or Marstal Navigationsskole offering course for working on LNG tankers. Regarding the Lithuanian project region, only a very tiny proportion of the institutions are already involved into direct LNG activities. To give more detailed information, NPPE – Klaipeda Shipping Research Centre focuses on future implications of direct LNG activities for the Lithuanian region. SGS Klaipeda

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provides sound competences in LNG Contract Review and Consultancy, LNG Portable Sample and Testing Rig, LNG Ship Calibration and LNG Training, etc. However, as it is apparent from the data gathered, institutions possessing strong command with the direct LNG activities are to a great extent absent. In this respect, there can be recognised only indirect impact of the institutions on LNG initiatives and activities. In terms of LNG-related activities of institutions involved, it can be argued that there exists a series of institutions revealing competences related to the LNG. These institutions are quite equally distributed over the SBSR. Taking a closer look at them, the SBSR reveals strong knowledge in providing command with LNG-related (mostly indirectly) technologies, i.e. maritime technologies, marine engineering and ship / shipping technologies. To give more detailed information, the Polish (Szczecin Maritime University, Gdynia Maritime University) and the Danish institutions (Maersk Maritime Technology) have great potential in providing with competences in the field of tanker familiarisation, technical services to different vessels, their operation, repair and new building as well as ship mechanics. An outstanding region in this light appears to be the German project region, since there have been located a number of essential institutions that reveal knowledge and competences in maritime-based activities. For instance, Department of Maritime Studies and Department of Mechanical Engineering / Processing and Environmental Engineering, Maritime Institute Warnemünde e. V., Institute for Maritime Theory, Simulation and Maritime Systems at the Wismar University of Applied Sciences and MATVAV – Institute for Maritime Automation Technology and Navigation e. V. are involved into the maritime-based activities that cover nearly all for the LNG initiatives and activities relevant fields or sectors, i.e. ship operation technologies, ship building, shipping, logistics, maritime navigation and maritime processes, etc. Moreover, the partners in the Danish Underground Consortium (DUC) have entered into an agreement to finance the Danish Hydrocarbon Research and Technology Centre at DTU, which is to be established and run at DTU. Once fully commissioned, the centre will employ around 100 people and will be linked to research groups from partner institutions including the University of Copenhagen, Aarhus University, Aalborg University, and the Geological Survey of Greenland and Denmark (GEUS). The goal of the research centre is to provide the framework for international research and to lay the foundations for relevant, research-based study programmes with the potential to support interdisciplinary and interdepartmental research programmes. The overarching purpose is to identify new technological and conceptual solutions that boost oil and gas extraction in the Danish section of the North Sea. Furthermore, when compared, a great bundle of competences the institutions bring with them lie in simulation and manoeuvring-related activities (Szczecin Maritime University (PL), Marstal Navigationsskole (DK), FORCE Technology (DK), Maersk Technology (DK), Maritime Institute

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Warnemünde e. V. (DE), ISSIMS – Institute for Maritime Theory, Simulation and Maritime Systems at the Department of Maritime studies of the Wismar University of Applied Sciences (DE), Maritime Simulation Centre Rostock-Warnemünde (DE), Chalmers University (SE). In terms of institutions involvement into maritime-based activities and their respective knowledge and competences, although these ones do not directly refer to the LNG, it is argue here that the particular maritime-based know-how is essential, because it implies a great potential for the LNG activities in the SBSR, or is an important prerequisite to launch the LNG activities. More specifically, since the LNG initiatives and activities are bound not only to technological requirements or conditions, but are also subject to the recognition of such factors as, for instance, environment, safety, etc., there is a great need to fill the void with knowledge and competences ascribed to these factors. Within the maritime-based activities, there can be differentiated such key aspects as environmental, safety, legal and maritime policy-related issues. Taking the SBSR into account, it is apparent from the institutions identified that relevant knowledge and competence is equally distributed in the region. To give more detailed information, all project regions have institutions dealing with safe shipping, risk management, environmental issues. For instance, Maersk Maritime Technology (DK) has sound experience in ECO efficiency. Marstal Navigationsskole (DK) has competence in dealing with heavy working environment, incident investigation and analysis as well as transport of dangerous goods, Gdynia Maritime School (PL) focuses of safe cargo transport. The Maritime Institute Warnemünde at the Wismar University of Applied Sciences addresses safety training, safe shipping, etc. Other German institutions located reveal knowledge and competences in safe secure and ecological performance (Department of Maritime Studies at the Wismar University of Applied Sciences (DE)). A core competence in safety-related issues possesses ISV – Institute for Safety Engineering and Ship Safety e. V. Warnemünde (DE). Important in terms of safety and environment are Swedish institutions as well. To give more detailed information, Linnaeus University (SE) deals actively with relations between environmental influence and public confidence in the shipping industry. World Maritime University of Malmö (SE) carries out activities in the fields of maritime safety and environmental administration, marine environment and ocean management. When comparing the institutional profile within the SBSR, the greatest potential in terms of environment and safety tends to reside in the Lithuanian project region, where a series of institutions have been identified. For instance, Klaipeda University with its laboratories and Coastal Research and Planning Institute focus on marine environment, sustainable management of coastal resources, pollution and researches, marine ecosystems, reliability of maritime structures, etc. Other relevant institutions address their competence in safety and health services of employees, fire safety, occupational risk evaluation, emergency management, security trainings and carriage of dangerous and hazardous substances. Beyond this, to the bundle of maritime-based activities the involved institutions carry out, there can be stressed institutional competences related to more soft-skills which, in turn, play a certain role for the implementation of safety and environment-related activities. For instance, Swedish

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Linnaeus University (SE) place an important focus on the communication technologies and conditions in the maritime industry by carrying out projects related to breaking down of language barriers and other communication-based difficulties in dangerous situations which may lead to accidents, or projects pertaining to safety culture building in shipping, etc. To sum up the knowledge and competence potential in the SBSR, it may be stated that the region in question reveals strong required potential in order to run or launch LNG initiatives and activities. Taken together, scientific and research-related know-how and competences highlight the following key topics in the SBSR that enjoy a great focus of the scientific and research community: Table 9: Key topics in the South Baltic Sea Region science and research related to LNG development Environmental impact of floating LNG LNG ship navigation planning Safety on LNG in the ports Simulation and training in terms of LNG LNG transport operations LNG shipping models LNG bunkering solutions LNG-related risk management LNG distribution Ship’s efficiency of using LNG LNG port infrastructure development LNG application in other transport and industry sectors Development of different ship segments – from LNG carriers to tugs and onshore power supply barges Source: based on regional profile data

What is at issue here is that all LNG relevant knowledge and competence is present in the region concerned. Technological, navigational, operational, training, educational, environmental, safe, secure and ecological questions can be answered when dealing with LNG activities. Of problematic nature appears, however, the aspect that the majority of institutions have experiences in the LNG activities, also most of them reveals strong potential and good

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command with activities and initiatives largely relevant for the LNG activities. Therefore, it can be argued that there is nothing that could hinder the respective institutions to support the businesses involved into LNG activities with the knowledge and competences demanded by them from the scientific side.

3.3 Institutional cooperation patterns With regard to the cooperation between and among the institutions identified, the data gathered reveals that the majority of institutions are cooperating, however, their cooperation appears to be limited to the respective project region. When it comes to the interregional cooperation, only some of them record cooperation with the institutions from other regions. For instance, the Danish and Swedish institutions underscore that there is no geographical limit for the possible cooperation. One of the existing cooperation patterns refers to possible establishment of a LNG Terminal at Hirtshals harbour when cooperating with Norway. Besides, some of the Danish education institutions offer international cooperation possibilities in terms of training courses, maritime studies and simulations. Regarding the situation of cooperation patterns in Sweden, some academic institutions, for instance, World Maritime University of Malmö has entered cooperation with Dalian and Shanghai in China. Taking a closer look at another project regions, the German institutions, especially, the Wismar University of Applied Sciences yields sound cooperation with such universities as Dalian Maritime University China, Sam Houston University USA, Institut Teknologi Sepuluh Nopember Indonesia, Semarang Growth Centre Indonesia, Gdynia Maritime University Poland, Calmers University Göteborg Sweden, WMU Malmö Sweden, Lloyds Register of Shipping London. Nevertheless, of essential importance appears to be the insight that the most of the project regions are already involved into the cooperation between the science and business side, for instance, in the Danish, German and Lithuanian regions. To exemplify, the Danish ship owners (Maersk, Lauritzen and Clipper) make use of services provided by education and training institutions in order to generate their studies. Similar situation has been observed in the German region, where, for example, the Wismar University of Applied Sciences is involved into the cooperation with Nord Yards Wismar GmbH in order to increase the linkage between the education / academic and business arrays in the field of ship building and maritime-related issues. To give another example, the Maritime Institute Warnemünde e. V. is cooperating with such businesses as Germanischer Lloyd, German Association for Positioning and Navigation (DGON) e. V., Baltic Institute for Maritime, Environment and Infrastructure Law. Furthermore, close intertwining of the institutions located in Rostock-Warnemünde witnesses high science and research potential that is accomplished by the business dimension, for instance, through cooperation with the European Cruise Academy or other relevant consulting or business-led institutions either on regional, federal or state level. To exemplify the cooperation between the science and businesses, the institutions in the Lithuanian project region are cooperating for the

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same purpose. In this respect, it refers to the LNG terminal planning and building, where educational and research institutions (Klaipeda University and Klaipeda Shipping Research Centre are cooperating with the Achema Group, SC “Klaipeda Nafta”, etc.). Besides, such LNGrelated initiatives as in case of Lithuania may stimulate the cooperation between state, private and public actors, since in terms of LNG terminal building in Lithuania there effective project implementation is bound to the cooperation of diverse institutions ascribed either to the scientific or business array. Additionally, similar cooperation patterns between the science and business yield the Klaipeda Shipping Research Centre due to cooperation with regional and international research and consulting institutions as well as business companies and authorities. Bearing in mind these observations it may be stated that the intertwining of science and business in the SBSR is evolving what, in turn, generates an essential prerequisite to support the businesses with the scientific knowledge and competences in terms of LNG activities. What is lacking, however, is more focus on interregional cooperation in order to increase the competences of the entire SBSR, thus gaining competitive advantage in terms of LNG-related activities. Moreover, when looking at the knowledge and competence portfolio in the SBSR at the moment, the cooperation scope regarding the LNG topic appears to be to a great extent gathered along the SBSR, although the LNG topic is relevant globally. Against this background, it is necessary to establish a cooperation structure, which would enable to expand scientific and research activities of the SBSR institutions by entering into cooperation patterns with institutions already having established contacts with China, USA, Canada, Australia, etc. As a result, internationalisation of the science and research activities would significantly influence the quality and commercialisation of services provided by the particular institutions.

3.4 Specification of scientific LNG-related activities When it comes to the LNG-related activities from the scientific and research perspective, there can be located a variety of diverse projects that reveal project competences of the participating regions. When compared the individual regions, every region records experiences in participating national, regional, interregional or international projects. To simplify the overview of all the projects or studies conducted in the SBSR, scientific activities can be grouped by using such determinants as content (LNG-related, safety-related, environment-related, navigation and operation-related) geographical proximity (regional, interregional, transnational and international as well as accumulation in certain parts of the region) and form of the activity (projects, researches, studies and other initiatives). When applying the content determinant, there can be generated diverse groups of projects and initiatives, depending on the key focus of them. However, as this study has been dovetailed with the LNG Knowledge and Competence Map within the project, as well as in order to yield better synergy effects between knowledge developing institutions (institutional profile) and knowledge absorbing groups (stakeholders of the SBSR LNG supply chain) the bundle of SBSR

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projects, research initiatives and other related activities has been classified into five key focus groups: bunkering-related (1), shipbuilding & repair-related (2), ports-related (3), shippingrelated (4) and end-user technologies-related (5) projects and initiatives, as carried out by respective knowledge generation and diffusion institutions. In terms of bunkering-related projects and initiatives, the following projects and initiatives have been conducted: Table 10: Bunkering-related scientific-research projects in the SBSR Name of project / initiative

Location in the SBSR

LNG Infrastructure Project LNG in Baltic Sea Ports (Bunkering infrastructure) The LNG Northern Europe Project LNG bunkering facility for Samsø island LNG Terminal in Rostock Feasibility Study LNG Bunker barge “TBX” by Theodor Buschmann & Marine Service GmbH New build LNG-fuelled ferry “Helgoland” LNG Initiative Northwest Gas Reservation Study related to LNG LNG small-scale terminal feasibility study WS1 LNG/FO Combo Vessel ISO TC67 WG10 PT1 LNG STS Bunkering Procedures Clean Baltic Sea Shipping Project

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Name of project / initiative

Location in the SBSR

JIP ScanBunk Terminal Lysekil LNG Ferry Viking Grace Innoship Project

Regional coverage in the SBSR

Pilot LNG

TEN-T participation of Sweden, Denmark

FLEXI Bunker Vessel

TEN-T participation of Sweden, Denmark

LNG Blue Corridors

Transnational, including SBSR regions FP7

LNG in Baltic Sea Ports II- Baltic Ports

TEN-T Participation of Baltic Sea Ports

Source: based on regional profile data

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Fig. 21: WS1 LNG/FO Combo Vessel

Source: White Smoke Shipping28

Furthermore, in terms of bunkering-related projects, new research endeavours have been made to strengthen and advance LNG bunkering facilities emergence across the Baltic Sea. A new bunker barge is planned to be delivered by Theodor Buschmann shipyard based in Hamburg in cooperation with Marine Service GmbH based in Hamburg too.

28

White Smoke Shipping, 2012, http://www.whitesmoke.se/en/shipping/ws1-lngfo-combo-vessel, accessed on 12 January 2013.

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Fig. 22: LNG bunker barge TBX

Source: Theodor Buschmann29

Similar, within the frame of the project Pilot LNG run by the Zero Vision Tool Platform and project, FLEXI-Bunker vessel will be developed. Fig. 23: FLEXI- Bunker vessel

Source: Pilot LNG30

29

Adopted from Theodor Buschmann, http://www.theodor-buschmann.com/crbst_19.html, accessed 20 April 2015.

30

Adopted from Pilot LNG, http://www.zerovisiontool.com/flexi, accessed 20 April 2015.

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This vessel will provide with a fast, efficient and safe bunkering system for LNG bunkering in- & offshore, as well as to develop efficient procedures for LNG bunkering. Regarding the second group of the projects and initiatives, namely, shipbuilding & repair-related projects, the SBSR yields only several related projects: Table 11: Shipbuilding & repair-related scientific-research projects Name of project / initiative

Location in the SBSR

Machinery for High-Speed LNG-Ferries

Retrofit of the ferry MS “Ostfriesland” Newbuilding of LNG-fuelled ferry “Helgoland” Short Sea Distribution & Bunkering (SSD&B) JIP Evolution LNG-fuelled tanker LNG Sea River (LSR) LNG bunker tanker by Bomin Linde and Klaipedos Nafta

Source: based on regional profile data

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Fig. 24: Retrofit of ferry MS “Ostfriesland” on LNG by AG Ems

Source: AG Ems31

Further, a new LNG-fuelled ferry will be built by Cassen Eils to run in the North Sea. This will be the first LNG-powered ferry under the German Flag constructed under the supervision of the classification society DNV GL. Fig. 25: German-flagged LNG-fuelled ferry

Source: DNV GL32

31

Adopted from AG Ems, http://www.ag-ems.de/aktuell/projekt-ms-ostfriesland.html, accessed 15 April 2015.

32

Adopted from DNV GL, http://www.gl-group.com/dnv_gl_helgoland_ferry-lng.jpg, accessed 15 April 2015.

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Looking at the ports-related projects, the SBSR recognises a huge potential of scientific and research activities, which have resulted in the following projects. Worth mentioning is here that to this group of projects and initiatives there have been allocated these ones, which point to LNG terminal building. Fig. 26: Floating Storage and Regasification Unit (FSRU) – technology of the LNG Terminal project in Lithuania

Source: LNG Terminal Lithuania33

With regard to the LNG Terminal development in Lithuania, there has been conducted a series of research studies and projects underpinning feasibility of terminal construction.

33

Adopted from LNG Terminal Implementation in Lithuania, 2011, http://www.enmin.lt/lt/uploads/brosiura_updated-2011.09.30.pdf, accessed 12 January 2013.

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Fig. 27: LNG Terminal Project in Swinoujscie, Poland

Source: LNG Terminal Swinoujscie34

The reasoning behind this case is that a series of LNG terminals established or planned terminals are located in the ports or in the proximity of the ports. Nevertheless, there are much more projects emerging in terms of LNG technology utilisation and knowledge exploitation, which has been gathered since several years. To mention some of them, one of the research projects deliverables should be JIP ScanBunk Terminal building within the TEN-T co-financing in Lysekil, Sweden. For this, several research studies will be carried out.

34

Adopted from LNG Terminal Project Poland, 2012, http://www.swinoujscie.pl/uploads/files/dla_inwestorow/zewnetrzne/lng.jpg, accessed 12 January 2013.

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Fig. 28: Construction plan for ScanBunk LNG terminal in Sweden

Source: Zero Vision Tool35 Table 12: Ports-related scientific-research projects in the South Baltic Sea Region Name of project / initiative

LNG in Baltic Sea Ports I & II

Location in the SBSR Baltic Sea Region

Concept of Wave Breaker Modernisation in Swinoujscie by Means of LNG Terminal Development (Port of Szczecin-Swinoujscie, 2007) Feasibility Study (Coordinator) LNG Terminal Construction in Police, Swinoujscie

35

Adopted from zero Vision Tool, http://www2.zerovisiontool.com/scanbunk/jip-scanbunk, accessed 22 April 2015.

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Name of project / initiative

Location in the SBSR

and Western Pomerania (2001) R&D Project – Development of Most Effective Solution For Sea LNG Terminal in Poland. Estimation of Optimal Parameters for Terminal and Sea Way, and Instruction of Safe Operation of Terminal (2005-2008) Concept of LNG Terminal Localisation (Gaz Project, 2005) Concept of LNG Terminal Location 2006 Feasibility Study of Terminal Building as Coordinator Port of Szczecin-Swinoujscie, 2007). Wave Breaker for Outer Port in Swinoujscie Construction, Place of Refugee for Outer Port in Swinoujscie Construction, LNG Unloading Quay Construction Quantitative Analysis of Risk for the Sea Terminal in Swinoujscie 2010 Feasibility Study of LNG Import Terminal in Lithuania Planning and Designing “Klaipeda Nafta” LNG Terminal Planning “Achema” LNG Terminal (Navigational Part) Source: based on regional profile data

With regard to shipping-related projects and initiatives, the SBSR reveals in this case strong capabilities and competences. In this category, there have been located the most projects implemented by scientific and research communities. Here, there can be allocated projects that point to navigation and operation-related issues. The following projects have been implemented:

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Table 13: Shipping-related projects in the South Baltic Sea Region Name of project / initiative

Location in the SBSR

Natural Gas as Propulsion for the Shipping Sector in Denmark MARKIS – Maritime Competence and Innovation Cooperation in the Skagerrak & Kattegat KOGAS Project The CNSS Project – Clean North Sea Shipping Programme ICEMAR CIMET – Centre for International Maritime Education and Training Clean Baltic Sea Shipping Pilot Navigation and Docking System for LNG Tankers and Sea Ferries Navigational Analysis of Entering LNG Carriers of Capacity 200.000 m3 to Gdansk and Swinoujscie Ports at Polish Coast Research Centre for Ships Operation Risk Analysis DGON Bridge – Development of A Modular Integrated Navigation Bridge (DGON Bridge) ADANAV – Adaptive Navigation System for the Precise Regulation of Position, Course and Speed of Ships with New Engines MUBES – Multisensor-based Motion Regulation for the navigation of fast ships NACOM – Navigation Support through Integrated Communication NADAKOS – Navigation data in shipping cooperative systems

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Name of project / initiative

Location in the SBSR

MultiMar – Identifying and Generating Multi-Variable Parameters for Movement Models of Maritime Objects: Concept and Experimental Test in Rostock Research Port ZuMANZ – Condition-Based Indication of Manoeuvres for Assistance in Vessel Management MARSPEED – Training Simulator for High-Speed Maritime Craft VESPER – Improving the Safety of Ferry Passengers SIPAS – Methods for Identifying and Maintaining a Safe Passing Distance when Overtaking and Encountering Vessels in Restricted Waters MarNIS – Maritime Navigation and Information Services: An European Research Project for Improving the Maritime Safety FAVECO – Collision Avoidance and Stranding Prevention System for Fast Ships NAWI – Nautical Knowledge Base for Collision Prevention of Sea-going Vessels ADOPTMAN – Advanced Planning for OPtimised Conduction of Coordinated MANoeuvres in Emergency Situations Source: based on regional profile data

Regarding the last group of the projects pertaining to end-user technologies, the following projects have emerged since the first version of this study: projects and studies related to the LNG-fuelled trucks integration on road in Germany and Sweden, LNG-tanks for the railways in Germany as well as LNG-driven public transport busses operating in Poland. Some of the projects have been already finalised, or concepts developed and presented. These will be discussed in LNG-related projects chapter of this study. Turning now to another determinant, namely, geographical proximity, it can be stated that most of the projects are concentrated recently in the Eastern part of the SBSR. This observation can be traced back, however, to the fact that Poland and Lithuania are actively involved into

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research activities because of being on the threshold of establishment of the LNG terminals. However, a sound accumulation of the research projects or initiatives has been recognised in the Swedish region as well (when comparing the tables of the projects above). Beyond this, when overviewing the projects identified, beside the regional projects that address national priorities, there can be differentiated cross-border and transnational projects that enjoying the EU funding, for instance, Clean Baltic Sea Shipping, MARKIS, MarTech LNG and LNG Northern Europe Project, etc., respectively. Hence, it is apparent that projects relevant or related to the LNG have gained attention not only on a national or regional level, but become of paramount importance also on interregional and international arenas, thus underscoring the potential and feasibility of LNG activities. In general terms, from the comparison of the scientific and research activities respective institutions have been involved in, it is evident from the data gathered that LNG-related projects have been dealt with recently in the Eastern part of the SBSR, especially in Lithuania and Poland. Nevertheless, it should be mentioned that such regions as the Danish and Swedish ones also render experiences in LNG-related scientific and research activities. What is surprising in this context is that such region as the German one does not demonstrate any sound participation into LNG-related activities, also the scientific and research knowledge and competence may provide a breeding ground for specific focus on LNG. In terms of the last determinant (scope or form of activity), the majority of the scientific and research performance can be ascribed to the local / regional studies (in case of the Polish and Lithuanian). The most research projects have been located in the Danish and German regions. By drawing on these observations it can be underpinned that the SBSR reveals a variety of diverse initiatives, either research studies or projects. What is lacking here when taking into account thematic highlights of the activities, is, however, more attention to the LNG-related initiatives or involvement of the LNG as topical subject into another maritime, shipping or navigation-based studies and projects in some parts of the region.

3.5 Challenges, obstacles and future perspectives faced by the SBSR scientific community When elaborating on challenges, obstacles and future perspectives within the scientific and research array, individual project regions do often point to diverse aspects. Nevertheless, one of the most frequently emphasised challenges addressed in the regional discourses point to the technological / technical terrain when discussing topical LNG issues. More specifically, there has been underscored the lack of and the need for more research, innovations and investments within the technical field, since installations (e.g. of LNG tanks) are very complex and require large space as well as private sector support. As a result, research-based challenges refer to

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future development of LNG products, whereby their evolvement is bound to presence of LNG-related infrastructure and investments of the private actors into the development of such products. Hence, science and research activities are challenged in a way that they should result in cost-efficient solutions that would catalyse the establishment of the LNG-related infrastructure, which, in turn, affects bringing out cost-efficient and sustainable LNG products, services, etc. pertained to the respective LNG infrastructure. Besides, the second common challenges or bottleneck mentioned is the lack of cooperation with progressive partners, institutions and authorities as well as support for the LNG activities on the national or regional level. Although the significance of the scientific and research institutions has been recognised by regional, federal and to some extent state actors, the institutions appear to lack respective financial support, as the relevant research projects and studies carried out require outstanding infrastructure, i.e. equipment, facilities, etc. Beyond this, while there has been identified cooperation between the academia and the businesses (in most of the project regions), the cooperation intensity tends to be of moderate extent. As a result, there is a need for more intense intertwining of the science / research and the business dimension as well as development and implementation of respective measures to attract the businesses for the maritime and respectively LNG-related activities what, in turn, would result in exploitation of the full potential and therefore enhance the economic strength of the whole SBSR. Finally, when taking into account the Eastern part of the SBSR region (especially Lithuania), the key drawback is lacking of knowledge and experience in dealing with LNG what, on the one hand, implies limited R&D infrastructure specialised for LNG. On the other hand, such situation, however may serve as a trigger to advance LNG-related activities, thus balancing out the overall knowledge and competence in terms of LNG in the entire SBSR. Taken together, it can be underpinned that the scientific input to a better acceptance of LNG and related activities of the SBSR in the public realm is of crucial importance. Therefore, science and research institutions could be more actively involved in spreading research and information in terms of LNG, its safety and environmental aspects, etc. for the public opinion.

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4

Scrutinising LNG value chain in the South Baltic Sea Region

The present chapter focuses on the LNG value chain in the South Baltic Sea Region. It starts with the specification of technologies and technical solutions in terms of LNG. Then it turns to the LNG-related stakeholders, i.e. all actors involved into LNG supply, delivery as well as enduser technologies. Aspects of LNG-related infrastructure, LNG products and services accomplish the manifestation of the SBSR value chain. The chapter is rounded off by structural delineation of the value chain in the SBSR elucidating what segments of the SBSR value chain are strong developed and record significant suppliers and what components lack reliable suppliers, what, in turn, is thwarting the emergence and thrive of the value chain in our region.

4.1 Anchoring present technological LNG-related capabilities To begin with, LNG supply and its investigation have been treated in respective discourses of paramount importance. Nearly most of the project regions have underscored the actual supply of LNG, the risk of LNG supply shortages or the LNG demand-related aspects. Furthermore, a significant issue appears to be in this particular context economic, financial, safety and risk as well as technical and operational aspects in terms of LNG value chain. Regarding the more detailed information on all relevant LNG-related capabilities, it may be stressed that the SBSR brings with it diverse capabilities. Furthermore, activities related to the LNG technology are likely to be diverse and distributed over different segments of the supply chain, thus creating better synergy effects and underpinning potential for efficient LNG integration and exploitation in the region. The overview of the key current LNG-related capabilities is the following: §

Biggest LNG ferries (129.9 m long, 19.2 m wide with capacity for 242 passenger cars and 600 passengers, gas-electric system with 3 large LNG gas motors and alternators, thus enabling a speed of approx. 20 knots)36.

§

Terminal LNG cargo tanks made by using a slip-form construction method37.

36

MF Boknafjord – the world’s largest gas ferry, 2012, http://www.dnv.com/industry/maritime/publicationsanddownloads/publications/updates/ferry/2012/01_2012/mf_bok nafjord__theworldslargest_gas_ferry.asp, accessed 20 March 2012.

37

Polskie LNG: Works on Second Swinoujscie LNG Tank Progressing Well, 2011, http://www.lngworldnews.com/polskie-lng-works-on-second-swinoujscie-lng-tank-progressing-well/, accessed 9 July 2012.

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§

Methods of regasification (evaporators heated by fuel itself – Submersible Combustion Vaporizer (SCV) and Evaporators heated by air or sea – Open Rack Vaporizer (ORV))38.

§

Pilot navigation and docking system for LNG carriers to increase of safety of berthing ships by the construction and implementation of innovative information and telecommunication system39.

§

LNG-powered ships, i.e. cruise ferries with engine compartments enable to run them on LNG40.

§

WS1 LNG / FO Bunker vessel with a 1.400 DWT, equipped with flexible cargo configuration (3 configurations possible) combining traditional HFO and MDO fuels with LNG and possessing a capacity for LNG between 700 m3-1.400 m341.

§

LNG Hybrid Barge as electricity supplier to the AIDA cruise ships with year-round utilisation of the system by feeding the produced energy in the cruise-off season into the municipal grid, thus supplying electricity and heat to approx. 11.000 households42.

§

LNG Hybrid Ferries Watten Link for use in the North Sea equipped with 3 proven LNG Gen sets, 2 electrical drive motors and 1 hybrid battery pack with LNG (only one fuel on board) supply for ferry service up to 4 days43.

§

LNG fuel tank containers44.

§

New generation passenger and car ferry powered by LNG – Viking Grace45.

38

Polskie LNG – LNG Re-gasification Methods, http://en.polskielng.pl/lng/re-gasification-methods/, accessed 9 July 2012.

39

L. Gucma, M. Gucma and A. Bak, 2012, Pilot Docking System – New Tool for Safe Maritime Operation, pp. 1-11.

40

Poland at Sea – Review of Polish Maritime Industry, 2012, http://www.portalmorski.pl/resources/poland-atsea/poland_at_sea_2012.pdf, accessed 9 July 2012.

41

http://whitesmoke.se/files/WS1%20web.pdf, accessed 19 November 2012.

42

LNG Hybrid Barge, http://www.lng-hybrid.com/2_projects/barge_intro.html, accessed 19 November 2012.

43

LNG Hybrid Ferry WattenLink, http://www.lng-hybrid.com/2_projects/fering_data.html, accessed 19 November 2012.

44

LNG fuel tank containers, 2013, http://www.marine-service-gmbh.de/content.php?seitenid=5, accessed 12 January 2013.

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§

Cruise ferries run by LNG46.

§

Operating LNG terminals (Lithuania and Sweden) and planned terminals in other regions of the SBSR.

§

LNG end-user technologies on the market (public transport buses, trucks, etc.).

§

Focus on investments into smaller ships with reduced emissions as a result.

In terms of the potential future capabilities, there have been located coherent innovative initiatives that would catalyse the capabilities to enhance technological strengths and potentials within LNG supply chain. To exemplify with two examples: 1. As key future themes have been listed LNG-powered bus public transport solution, where the focus is on the end-user technologies and end-users within the LNG supply chain. Besides, the introduction of the LNG-powered transportation would involve other actors of the LNG supply chain, e.g. supplies of the components for busses run with LNG. 2. Another potential capability resides in introduction of LNG stations that would allow operational cost reduction as well as alternative solution to CNG for different business models. Furthermore, LNG stations become a feasible solution when the number of LNG trucks will be increasing and bearing in mind the fact that ISO Standards are being discussed for LNG and LCNG stations construction. Concrete actions pertaining to LNG stations have been planned in the Northern German ports, e.g. Lübeck, Brunsbüttel, Hamburg, etc.

4.2 LNG-related stakeholders and players When taking into account potential stakeholders and players located in the SBSR, there can be differentiated between companies, associations, authorities, consultants, classification societies, ports, producers, distributors, ship-owners, storage and bunkering companies, system operators, end-user technologies as well as further organisations and institutions. On the basis of the data gathered from the project regions there can be generated the following stakeholders and

45

Viking Grace, 2013, http://www.vikingline.com/en/Investors-and-the-Group/Safety-environment/Environment/Viking-Grace/, accessed 11 January 2013.

46

Fjord Line LNG cruise ferries, 2013, http://www.fjordline.com/Our-ships/Our-new-ships/Environmental-profile/, accessed 11 January 2013.

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players portfolio for the SBSR. Stakeholders and players ascribed to the portfolio refer to the following categories: (1) Bunkering (2) Shipbuilding & repair (3) Ports (4) Shipping (5) End-user technologies. However, it is noteworthy that only key stakeholders and players will be listed here. The full stakeholders and players profiles can be found in the annexes of the study at hand or online at www.golng.eu. Beyond this, for the purpose of this study on LNG development patterns in the SBSR, it has been decided to incorporate into the study such stakeholders and players groups as (6) regulators (including authorities, classification societies and other relevant organisations and associations), (7) storage stakeholders, (8) distributing stakeholders and (9) consultants. Enhancing this study by these 4 stakeholders group enables a deeper insight into LNG supply chains development patterns revealing not only the business-side development, but also the general framework conditions and stakeholders that may significantly either accelerate or hamper the evolvement of the LNG and related activities. By drawing on the general accumulation and the distribution of the stakeholders along the supply chains in the SBSR, the present study has identified 307 relevant stakeholders. Allocation of the stakeholders to particular groups is depicted in the figure below.

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Fig. 29: Profile of stakeholders in the South Baltic Sea Region

Source: based on stakeholder profile data

Taking into account this breakdown of all relevant stakeholders across the SBSR, it is first important to accentuate stakeholders that are already equipped with LNG technological solutions, products and services, or do record LNG-related young or mature existing activities that have been mapped in the maritime industry discourses. In this respect, the first table on this chapter elucidates key stakeholders that due to their activities can be referred to as LNG stakeholders. Worth mentioning is that not all stakeholders are included in the following breakdown according to respective categories, but rather key stakeholders in terms of LNG technology utilisation or introduction in short-term. All stakeholders can be accessed on the project website.

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Table 14: Existing key LNG solutions in the South Baltic Sea Region LNG Stakeholders

Specification of LNG scope

Fiskerstrand BLRT / Western

LNG bunkering ships / ferries

Location in the SBSR

Shipyard Klaipedos Nafta

LNG Terminal Klaipeda

Fjord Line AS

Cruise ferries powered by LNG

Man Diesel & Turbo

LNG fuelled two-stroke engines

Rolls Royce Marine AS

LNG carriers

Wärtsilä

LNG systems

Viking Line

LNG ferry Viking Grace

White Smoke Shipping

LNG Bunkering solutions & STS Bunkering

Cryo AB

LNG bunker tanks and systems

Nordic Yards GmbH

LNG tank systems for arctic use

Marine Service GmbH

LNG fuel tank container

KAEFER Marine & Offshore

Cryogenic insulation solutions for LNG tank and cargo systems

Becker Marine Systems

LNG barge

Source: based on stakeholder profile data

To provide more specific information on the constellation of the stakeholders and players, each of the identified group will be presented shortly by specifying the stakeholders. With regard to

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pinpoint stakeholders recording LNG activities, respective stakeholders will be marked in the following stakeholder tables with the project logo

.

To begin with, similarly, as in case of technological / technical capabilities within the SBSR, one of the largest groups of stakeholders behind the regulation and framework conditions providing stakeholders such as authorities, classification societies can be located in the shipbuilding-related industry. In this context, naval architects should be also allocated to this group of stakeholders, since they are involved into design, construction and repair of marine onshore and offshore infrastructure and related structures. The following shipbuilding and repair industry-related stakeholders are present in the SBSR: Table 15: Key stakeholders from shipbuilding & repair industry of the South Baltic Sea Region Shipbuilding & repair stakeholders

Location in the SBSR

Fiskerstrand BLRT / Wetern Shipyard

SC “Western Shipyard” Søby Yard Marstal Yard

Samsø ferry Fayard Yard

Man Diesel & Turbo

Rolls Royce Marine AS

Wartsila

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Shipbuilding & repair stakeholders

Location in the SBSR

ABB OSK Ship-Tech DK Schottel GmbH Wismar

Nordic Yards GmbH

Becker Marine Systems Hamburg

Frauenhofer Anwendungszentrum Rostock Ingenieurtechnik und Maschinenbau GmbH Muehlhan Rostock GmbH R & M Ship Technologies GmbH

KAEFER Marine & Offshore

Neptun Ship Design GmbH Rostock IMAVIS Maritime Wirtschafts- und Schiffbauforschung GmbH BaltiCo GmbH bei Rostock Marine- und Automatisierungstechnik GmbH Rostock-Warnemünde SDC SHIP Design & Consult GmbH

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Shipbuilding & repair stakeholders

Location in the SBSR

AG Ems

Theodor Schumann Gdanks Ship repair Yard Remontowa

White Smoke Shipping

Cryo AB Source: based on stakeholder profile data

When taking into account shipping companies and related stakeholders, in some cases it is hard to allocated them distinctly to the shipping stakeholders category. In fact, these can be in some cases placed either in shipbuilding & repair or shipping-related group. Nevertheless, this study made an attempt to identity key shipping stakeholders in the SBSR: Table 16: Key stakeholders from shipping industry of the South Baltic Sea Region Shipping stakeholders

Location in the SBSR

Lauritzen Kosan

Mæersk LNG

Evergas

Clipper Group

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Shipping stakeholders

Location in the SBSR

Fjord Line Denmark AS

Mæersk Line Ltd

Mols linien AS

Rederiet færgen

Nordic Yards GmbH

SDC SHIP Design & Consult GmbH

AG Ems

DFDS Seaways

Swedish Marine Forum

Stena

Viking Line

White Smoke Shipping

Wärtsilä

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Source: based on stakeholder profile data

Turning towards stakeholders capable to distribute or storage gas, especially with the focus on LNG, there are located relevant 26 distributing and 10 storage companies able to provide demanded services currently and in the future. As a result of the data, the following constellation of the distributing companies has been generated: Table 17: Key stakeholders involved into distribution activities across the South Baltic Sea Region Distributing stakeholders

Location in the SBSR

Dong gas Distribution

Q8

EnergiDK

Aalborg gasforsyning

Naturgas fyn

HNM Naturgas

EON

Shell

Bomin Linde

Gazprom Germania

Klaipedos Nafta

Lietuvos Energija

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Distributing stakeholders

Location in the SBSR

Gaz-System

Budnaft

Petrolinvest

PL Energia

Polskie LNG

Gaspol Energy

LNG Silesia

Cryogas M&T Poland

PGNiG

Swedish Gas Association

Stockholm liquefied Methane gas station

Enagas S.A.

AGA

E.ON Source: based on stakeholder profile data

As the main storage companies can be distinguished the following companies across regions of the South Baltic Area. These companies and stakeholders refer to LNG storage capabilities,

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which mainly refer to LNG tanks, transportation containers, LNG transfer and storage systems, such us special couplings or similar. These stakeholders are closely related to bunkering companies, nevertheless most of them yield competences in storage activities prior the LNG development in the region. Table 18: Storage services providing key stakeholders of the South Baltic Sea Region Storage stakeholders

Location in the SBSR

Dong Storage

Shell Marine Service

Energinet DK Gaslager

Marine Service GmbH Hamburg

Bomin Linde

JSC Klaipedos Nafta

Budnaft

PL Energia

Polskie LNG

PGNiG

AGA AB in Nynäshamn port

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Storage stakeholders

Location in the SBSR

Mann-Tek

Royal Vopak in Gothenburg port Source: based on stakeholder profile data

Dovetailed with the storage companies are bunkering companies that are of paramount importance when dealing with LNG-related issues. However, bearing in mind the bunkering solutions landscape in the SBSR it appears to be emerging in terms of bunkering with a record of 22 bunkering service providing companies: Table 19: Bunkering solutions providing key stakeholders of the South Baltic Sea Region Bunkering stakeholders

Location in the SBSR

Dan-Bunkering Ltd

Shell Marine Service

OW Bunker & Trading

FSRU Klaipeda

TGE Marine Gas Engineering GmbH

Marine Service GmbH

Becker Marine Systems GmbH

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Bunkering stakeholders

Location in the SBSR

Bomin Linde

White Smoke

Swedish Marine Technology Forum

Trelleborg Marine Systems

Emerson Process Management

SSPA Sweden AB and ÅF AB

AGA

Porta Zegluga Ltd

LNG Silesia

GÓRNOŚLĄSKI ZAKŁAD OBSŁUGI GAZOWNICTWA Sp. z o.o. Polski Source: based on stakeholder profile data

Distributing, storage, shipbuilding & repair as well as shipping stakeholders are significant only in a case, where there exists respective LNG-related sufficient “room” to operate for the identified stakeholders. Here, this particular room or space to operate has to be understood as infrastructure. Coming back to the LNG-related discourse, usually the infrastructure is located in ports, and often, in in the immediate proximity. Taking the SBSR into account against this background, the SBSR possess a series of ports that are relevant for LNG-activities. At the second glance, however, 33 identified ports along the SBSR manifest different degree of

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relevance for the LNG-activities and infrastructure. In order to provide a clear insight into the significance of the identified ports, it was decided to build the following discussion concerning the ports upon a proposed classification of these particular ports. After having studied the information on the ports, there was made an observation that SBSR can be divided into some groups in terms of their current participation into LNG activities (1), future participation into LNG activities (2), high level of maturity / potential for LNG activities (3) and having potential, but necessary to undergo further development (4). Based on these categories, following allocations of the ports have been generated. Ports below are currently integrating into LNG-related operations in a sense that there are established and function LNG import / receiving terminals and / or other bunkering facilities, etc. Accordingly, ports that specify these activities are concentrated in the Northern part of the SBRS, i.e. Sweden. Table 20: Ports of the South Baltic Sea Region with existing LNG activities Ports currently involved into LNG activities

Location in the SBSR

Nynäshamn Port

Lyekil LNG Terminal

Klaipeda Port Source: based on stakeholder profile data

With regard to the second determinant, LNG-related activities will be mushrooming highly in the Eastern SBSR part, in the Swedish, Lithuanian and Polish coastal regions, respectively. Based on the available data, there will be established LNG terminals and / or small-scale bunkering facilities in the following existing ports:

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Table 21: Ports of the South Baltic Sea Region with forthcoming LNG-related activities Ports involved into LNG activities in the near future

Location in the SBSR

Gothenburg Port

Port of Hirtshals

Port of Klaipeda

Port of Swinoujscie

Port of Hamburg

Port of Rostock Source: based on stakeholder profile data

Ports that fall into the category of high level of maturity, or ports that are relevant because of evolvement of LNG activities in the neighbouring regions (e.g. in case of Germany) are the following: Table 22: Ports of the South Baltic Sea Region revealing high potential for the LNG-related activities Mature Ports and / or ports of high potential for LNG activities

Location in the SBSR

Port of Hamburg

Rostock Port

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Mature Ports and / or ports of high potential for LNG activities

Location in the SBSR

Port of Wilhelmshafen

Port of Brunsbüttel

Port of Lübeck

Hirtshals Port

Port of Helsingborg

Source: based on stakeholder profile data

Finally, the information gathered revealed that there exist a certain number of ports in the SBSR that have potential and could step in LNG-related activities. However, these ports underlie the necessity to develop further and / or undergo some technical, infrastructural, political and investment-related modifications in the regions concerned. The list of potential ports is the following:

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Table 23: Ports of the South Baltic Sea Region involved in plans for development for LNG-related activities Ports having potential for LNG activities but requiring certain modifications

Location in the SBSR

Esbjerg Port Rønne Harbour Aarus Harbour Port of Copenhagen and Malmö Port of Sjællands Odde Rødby Færgehavn Gedser Port Helsingor Port Spodsbjerg Port Tårs Port

Port of Gdynia

Port of Gdansk

Port of Szczecin Source: based on stakeholder profile data

By bearing on the potential stakeholders identified so far, the potential for the LNG development in the SBSR appears of solid nature. However, solid supply chain is ground not only on the private sector stakeholders, but involves actors from the public sphere that may be crucial in changing, for instance, the perception of the development of LNG in the SBSR. Hence, stakeholders that take significant decisions are involved into relevant ruling procedures, or outlines, e.g. regulations pertaining to maritime industry, etc., such as standards etc., provide normative grounds that in the particular context of LNG development shows up as significant.

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This study reveals that there are a number of such “regulators” involved into respective processes. As key authorities can be listed: Table 24: Key authorities of the South Baltic Sea Region relevant for LNG-related activities Authorities

Location in the SBSR

Danish Maritime Authority

Danish Ministry of Business and Growth

Danish Ministry of Transport

Danish Ministry of Climate, Environment and Building

BSH – Federal Maritime and Hydrographic Agency

Federal State of Mecklenburg-Vorpommern

German Ministry of Transport (federal and / or regional)

German Ministry of Environment (federal and / or regional)

German Ministry of Regional Planning (federal and / or regional)

Lithuanian Ministry of Energy

Lithuanian Ministry of Transport and Communications

Lithuanian Ministry of Finance

Lithuanian Ministry of Environment

Lithuanian Ministry of Foreign Affairs

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Authorities

Location in the SBSR

SE Klaipeda State Seaport Authority

Maritime Office Szczecin

Maritime Office Gdynia

Maritime Office Slupsk

Swedish Ministry of Defence

Swedish Ministry of Transport

Swedish Ministry of Enterprise

Swedish Ministry of Energy and Communications

Swedish Ministry of Environment

Swedish Maritime Administration Source: based on stakeholder profile data

Key identified authorities (alongside a large number of regional municipalities and regional authorities) are accompanied by the relevant organisations and / or associations, which may have an important impact when developing LNG in the SBSR: Table 25: Key associations of the South Baltic Sea Region relevant for LNG-related activities Associations

Location in the SBSR

Danish Ship owners Association

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Associations

Location in the SBSR

Danish Maritime Authority

Danish Gas Association

Danish Energy Agency

Danske Havne

Society for Naval Architecture and Marine Engineering

DTL

German Association for Positioning and Navigation (DGON) e. V.

Logistik Initiative Mecklenburg-Vorpommern

National LNG Initiative Platform

Maritime Cluster Northern Germany

Erdgas-Mobil

German Ship owners Association

Association of Lithuanian Stevedoring Companies

Lithuanian Ship owners Association

Association of Polish Maritime Industries

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Associations

Location in the SBSR

The Polish International Freight Forwarders Association Gdynia Poland

Polish Chamber of Maritime Commerce Gdynia Poland

Polish Ship-owners Association

Swedish Maritime Administration

Swedish Ship-owners Association

Swedish Gas Association

Swedish Transport Agency

Gothenburg Transport Agency Source: based on stakeholder profile data

The last group of “regulators” refer to classification societies. When overviewing these ones in the SBSR, the distribution of them tends to be equal. However, most of them refer to the same organisations, but have a status of branch or are established in the particular region. There can be listed following classification societies in the SBSR: Table 26: Classification societies of the South Baltic Sea Region relevant for LNG-related activities Classification societies

Location in the SBSR

Bureau Veritas

Entire SBSR

DNV GL

Entire SBSR

Lloyd’s Register of Shipping

Entire SBSR

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Classification societies

Location in the SBSR

Polish Register of Ships

SIS

CIMET Source: based on stakeholder profile data

Beside the regulation institutions providing with the norms and normative information, there can be consulted companies, organisations or associations that may assist in LNG-related issues. To the key consultants in the SBSR can be ascribed the following stakeholders: Table 27: Key consultation services providing stakeholders of the South Baltic Sea Region Consultants

Location in the SBSR

Danish Gas Technology Centre

DNV GL

Rambøll Oil & Gas

Grontmij

Force Technology

IMAVIS – Maritime Wirtschafts- und Schiffbauforschung GmbH

Hamburg Marine Business Development (CEA)

Lloyd’s Register Marine Hamburg

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Consultants

Location in the SBSR

DNV GL

Marinesoft – Entwicklungs- und Logistikgesellschaft mbH

ATI erc GmbH

ATI Küste GmbH

FGW – Forschungs-GmbH Wismar

DNV GL Lithuania

Klaipeda Science and Technology Park

Novikontas SCM, UAB

Association “Baltic Valley”

NPPE Klaipeda Shipping Research Centre

Sweco Lietuva

DNV GL Poland

BMT Maritime Consultants Sp zoo Gdansk

Polish Register of Ships

AGA AB

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Consultants

Location in the SBSR

CRYO AB

Skangass AS

White Smoke Consulting

Frederiet AB

FKAB Marine Design

Samson

Mann-Teknik AB

CIMET

DNV Source: based on stakeholder profile data

To finalise the stakeholder profile, it is inevitable to look at the end-users that will be approached in terms of LNG products, services, etc. and thus are regarded of paramount importance for demanding and absorbing the knowledge and competence accumulated in the SBSR. Relevant for identification of end-users are, first, end-user technologies stakeholders that are already available in the SBSR. As end-user related technologies are understood technologies that refer, particularly, to: (1) ship owners and ship operators; (2) land infrastructure (LNG as a fuel, e.g. trucks, cars, etc.); (3) industry power generation; and (4) gas and electricity grid.

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Table 28: Key stakeholders of the South Baltic Sea Region involved into end-user oriented technologies End-user technologies stakeholders

Specification of end-user technology, if available

Location in the SBSR

Østkraft produktion A/S

Dong Energy A/S

Storage and bunkering possibilities for customers

Clipper Group

Looking at LNG but no concrete initiatives planned

LNG-powered ferries launched in 2013 FjordLine A/S

and 2014

LNG bunkering at Hirtshals for the FjordLine A/S

LNG-fuelled ferries

Carrying LNG but no concrete Lauritzen Kosan A/S

initiatives to run on LNG

Maersk Line Ltd

Research to create individual business cases for ships to run on LNG

Maersk LNG

Carries LNG

Mols linien AS

First Samsø municipality LNG-fuelled Samsø ferry

passenger ferry

Rederiet færgen

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End-user technologies stakeholders

Specification of end-user technology, if available

Location in the SBSR

LNG fuel tank container, 40 feet Marine Service GmbH Hamburg

standard

LNG couplings for LNG transfer and Marine Service GmbH Hamburg

fuelling procedures during the bunkering via tanks or trucks for industry customers

LNG delivery to LNG-fuelled buses in Gazprom Germania

Poland

Becker Marine Systems GmbH Hamburg

LNG barge to serve shipping customers (power supply to AIDA cruise ships), onshore power supply

LNG-fuelled Stralis LNG truck IVECO

LNG Econic truck Mercedes Benz

Solobus SOLCITY LNG according to MAN

the Euro-6 norm for public transport

VTG

VTG LNG Tank Wagons developed for LNG infrastructure in Brunsbüttel port

Energobaltic

LNG-fuelled buses for public transport SOLBUS

in Warsaw and Olsztyn

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End-user technologies stakeholders

Specification of end-user technology, if available

AGA AB

Propane sold in cylinders

ETG

Electric and LNG services

Volvo AB

Volvo FM Methane Diesel

Wayne

Production of compressed natural gas

Location in the SBSR

(CNG)

Alfa Laval

Cargo condenser and / or heater aboard liquid petroleum gas (LPG) carriers

Supplying LNG for Viking Line’s new AGA Gas AB

passenger ferry

First refuelling station for liquefied AGA / Volvo Trucks

methane gas, LNG / LBG in Statoil Järna

Source: based on stakeholder profile data

Bearing in mind the overview of the main stakeholders and players within the SBSR, it is, however, apparent that some of the identified actors across the SBSR can be ascribed to more than one type of the stakeholders and players, since some of them are simultaneously involved into more activities. Therefore, overlapping cannot be excluded. Nevertheless, when making a comparison of the key stakeholders pinpointed, it is evident that the highest proportion of the stakeholders and players consists of companies, where most of them are involved into maritime-related activities, i.e. shipping, ship repair and construction as well as gas and oil supply. What appears to be at stake at the moment is the involvement of the authorities and public institutions into LNG activities and infrastructure. Hence, the promotion of LNG and awareness of LNG advantages might be limited to the business sector, thus gaining little consent in the public sphere and political support. Furthermore, when it comes to the assessment of the stakeholders and players, it can be argued that also the SBSR in general has available stakeholders and players relevant for the LNG supply chain, the bottlenecks tend to lie in LNG

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itself as a primary resource and its supply or export. On the contrary, when it comes to those components of the LNG supply chain that refer to LNG shipping, potential locations for LNG importing (terminals), regasification, its storage, distribution and marketing, the region seems to reveal a sound potential for the utilisation of LNG in the future. From the data gathered it is apparent that there are actors capable of taking over the particular LNG activities within the LNG supply chain, for instance, ports, manufacturers, shipyards, consultants, etc.

4.3 LNG-related infrastructure Regarding the infrastructure relevant to LNG in the SBSR, it is apparent that direct LNG infrastructure facilities in the SBSR are emerging. When compared to 2012, where there was already established LNG infrastructure at Swedish Port Nynäshamn, in 2014 there can be recorded established in Klaipeda (LT) and Lysekil (SE). LNG terminal in Poland is under construction and should be finalised shortly. Strong capabilities in developing LNG infrastructure demonstrates the Swedish region, which possesses the LNG import (receiving) terminal in Nynäshamn port and one located in Lysekil. Fig. 30: LNG Import Terminal in Nynäshamn

Source: Bomin Linde47

47

Adopted from Bomin Linde, http://bominlinde.com/_p-hintergrund-upl/terminal2.jpg, accessed 15 April 2015.

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Additionally, LNG development projects in terms of LNG infrastructure are currently implemented in Sweden (Port of Gothenburg and Port of Gälve). These projects are planned to be finalised in 2015. Looking at the other parts of the SBSR, there is existing LNG terminal in Klaipeda (LT). Additionally, Klaipedos Nafta as a terminal operator is planned to establish small-scale bunkering facility. Nevertheless, our region still yields limited upstream LNG infrastructure with the case of Sweden and Lithuania. Nevertheless, as the observations reveal, the potential for the developing LNG downstream infrastructure in the region is present, especially when taking into accounts knowledge, competences and stakeholders, etc. prevailing in the SBSR. Fig. 31:LNG Terminal in Lysekil, Sweden, opened in 2014

Source: Skangass48

As the situation of the ports in the SBSR demonstrates there are tangible initiatives to set up LNG terminals in Hirtshals, Swinoujscie, Rostock and Hamburg. Bunkering facilities are planned

48

Adopted from Skangass, http://www.skangass.com/index.cfm?id=412890, accessed 20 April 2015.

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in Brunsbüttel (DE), Klaipeda (LT), different locations in Denmark and Sweden. However, no concrete planes confirmation is available at the time of this study carried out. Fig. 32: LNG Terminal FSRU “Independence” in Klaipeda, Lithuania

Source: Klaipedos Nafta49

It may be argued that other regional ports would follow breakthrough of the first LNG terminals, thus contributing to the evolving LNG infrastructure and attracting other stakeholders, projects, initiatives, etc. Beyond this, project regions do advocate the establishment of LNG import or receiving terminals and building of offshore vessels and regasification vessels, regasification, storage and bunkering stations as well as gas pipeline systems and possibility of onshore power supply.

4.4 LNG product portfolio When dealing with LNG products, the situation is similar to that of the LNG infrastructure. Since LNG products, services and other LNG-related initiatives and processes underlie synergy effects with the infrastructure, emerging infrastructure results into increasing supply of LNG products in the SBSR’s market. Nevertheless, in case of LNG projects, it is argued here that there are available much more LNG products on the market than LNG related infrastructure.

49

Adopted from Klaipedos Nafta, http://www.sgd.lt/index.php?id=589&L=1, accessed 22 April 2015.

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This can be, in turn, traced back to the fact that LNG infrastructure is subject to high investments. Furthermore, a highly coordinated approach of different actors, such as port authorities, regulators, shipping operators, ship owners, etc. is needed to efficiently match supply and demand sides. To exemplify, the Swedish region demonstrates some relevant LNG products, such as tank and bunkering system design and building of the world’s first Marine LNG supply vessel for ship to ship bunkering, standards for LNG bunkering, combo bunkering vessels, procedures for bunkering operations of LNG in terms of safe and efficient technologies, etc. Compared to the Swedish region where the LNG-related products are mushrooming, other regions in the SBSR also yield relevant LNG products, which find their customers on the market. For example, Becker Marine Systems has developed LNG ferries to be operated in the North Sea and LNG barge for the cruise company AIDA. Fig. 33: LNG Hybrid Barge “Hummel” developed by Becker Marine Systems GmbH, Hamburg

Source: LNG Hybrid Barge50

Nordic Yards with its shipyards in Wismar and Rostock has developed LNG carriers to be used under the Arctic conditions. The LNG-related conceptualisation is characterised by Containment System Technology and development (Aluminium Double Barrier Tank/ADBT);

50

Adopted from Becker Marine Systems, http://www.lng-hybrid.com/2_projects/barge_intro_d.html, accessed 15 April 2015.

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Diesel Electric Dual Fuel Propulsion Technology (DE/DF) and New generation concepts for LNG-carriers and floating facilities. Fig. 34: Nordic Arctic LNG carrier

Source: Nordic Yards51

Not only in the shipbuilding sector concrete projects have been accomplished. For example, Marine Service GmbH Hamburg (Germany) has developed LNG fuel tank container. Further, the company has developed floating power supply barge – LNG Power Barge. Fig. 35: LNG Power Barge developed by Marine Service GmbH

Source: Marine Service GmbH52

51

Adopted from Nordic Yards, http://www.nordicyards.com/_portfolio.html, accessed 20 April 2015.

52

Adopted from Marine Service GmbH, http://www.ms-de.eu/lng/lng-power-barge/, accessed 25 April 2015.

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Fig. 36: LNG fuel tank container developed by Marine Service GmbH

Source: LNG World News53

In Denmark, Samsø Municipality has finalised the project on delivering LNG-fuelled ferry to serve passengers. This ferry was built by the Polish shipyard based in Gdansk Remontowa.

53

Adopted from LNG World News, http://www.lngworldnews.com/wp-content/uploads/2012/09/Marine-ServiceIntroduces-LNG-Fuel-Tank-Container.jpg, accessed 23 April 2015.

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Fig. 37: Duel-fuelled (LNG) Samsø ferry operating in Denmark

Source: Remontova54

However, based on the observations in the participating regions, although the LNG product range appears to be at the moment of quite limited extent, technological, knowledge and competence capabilities spread over the SBSR underpin high potential for LNG product evolvement. The point of departure for product evolvement can be found in the shipbuilding and repairing industry (yielding especially strong competences) that is able to provide products directly related to LNG, for instance, LNG bunkering and tank facilities, ferries run on LNG, LNG tankers and containers, bunker / feeder vessels and trucks, etc.

4.5. LNG-related services When it comes to LNG-related services in the SBSR, similarly, as in case of products, the majority of the services has been allocated to the shipbuilding industry providing services in building LNG fuelled vessels, unloading LNG from carriers and tankers, processing LNG storage and regasification, monitoring and testing, etc. To exemplify, the Swedish stakeholder “White Smoke” plays important role in catalysing LNG-related services. More specifically, since the start

54

Adopted from Remontova, http://www.remontowa-mdc.com.pl/rmdc-2872-samso-passenger-car-ferry, accessed 20 April 2015.

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of the activities by the company, significant investments have been made to develop supply chain for LNG as a marine fuel. By assisting with technical, commercial and regulatory expertise as well as project management services in terms of LNG and LNG bunkering this particular stakeholder accelerates LNG service development. Nevertheless, as it is apparent from the data gathered, LNG activities should not be limited to one directly linked with LNG as a marine fuel, bunkering and accompanying measures. By contrast, overview of LNG activities in the SBSR implies the need of further relevant services, such as special software for LNG-related solutions, services provided by design and construction companies, R&D and consultation services required to assess, e. g. environmental impact, safety, feasibility of LNG use or to conduct LNG-related cost and benefit analyses as well as engineering assessments, etc. Furthermore, in order to utilise LNG effectively, there are needed efficient LNG distribution and trading services provided by respective service provides. Nevertheless, when bearing in mind the bundle of services related to LNG, number of these particular services can be provided by the ports, which have been identified as significant stakeholders. As a result, it may be stated that currently important services pertaining to LNG refer to (1) LNG utilisation as efficient and clean marine fuel, (2) bunkering facilities and related solutions. What direct with LNG linked services are still lacking to a certain extent (except Sweden), are these ones that point to LNG liquefaction, processing, safety, competitiveness, etc. Taken together, the analysis of the supply chain segment covered here revealed what segments of the supply chain are covered with the relevant stakeholders and which parts are very scarce and lack relevant stakeholders. Generally, the current stage of the supply chain in the SBSR can be elucidated as follows: Fig. 38: Distribution of stakeholders’ capabilities along the LNG supply chain in the South Baltic Sea Region

Shipping Liquefaction

DK, LT, DE, SE, PL

LNG Import Terminal SE, LT (PL)

End-users DK, (PL), DE, SE, LT

Source: based on stakeholder profile data

In particularising the observations regarding the emerging SBSR LNG value chain it is apparent that the single segments of the SBSR supply chain are covered, however, some of them are subject to more intense capability building or are of quite moderate nature. Capabilities of the regions put in brackets indicate their evolvement in the near future, since at the date of compiling this joint LNG study such capabilities did not exist, but are planned to be launched and implemented soon. To anchor the capabilities presented in the region concerned, the

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following matrix was delineated. On the one hand, this matrix embraces the information reflecting what parts of the supply chain and to what extent entail developed knowledge and competence portfolio, which, in turn, is capable to support businesses to with the LNG-related knowledge and technologies. On the other hand, the matrix unveils the capabilities of the SBSR supply chain more specific how LNG-related infrastructure has been handled at present and will be dealt with in the next future. Table 29: Specification of present LNG-related activities of the South Baltic Sea Region value chain Segment of the

Short specification of the capabilities

Supply chain of

Distribution of capabilities

Evaluation

along the SBSR

criteria

the SBSR

Existing

++

Developing

+

Planned

0

Planned, but not

00

decided yet Missing Shipping

LNG feeder vessels

SE

+

LNG bunker vessels

SE

++

Ship-to-ship bunkering (STS)

SE, LT

++

LNG Terminals

LNG Import terminal

SE, LT, PL, DE, DK

++ / +

LNG onshore

Small-scale export / bunker facilities

DE, DK, LT, PL, SE

+/0

infrastructure

LNG bunker stations

DE, DK

0

LNG filling stations

DE

0

LNG fuel tank containers

DE, SE

++

LNG trucks

SE, DE

++

Tank & bunkering solutions

SE, DK

++ / + / 0

Shipping

SE, DK, DE

++ / +

LNG trucks for roads

SE, DE

++ / +

LNG-fuelled buses for public transport

PL

++

LNG power supply

DE

++

LNG tank containers for railways

DE

+/0

End-users

-

Source: based on stakeholder profile data

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5

LNG-related initiatives and projects

On basis of the data gathered from the project regions it is evident that LNG initiatives and projects in the SBSR are mushrooming. However, most of the initiatives pinpointed are at the beginning stage, and there have been implemented limited to LNG related projects, e.g. in Sweden. However, in this vein the SBSR in terms of LNG projects and initiatives appears to be very unbalanced, since other parts of the region have not communicated topical finalised projects. By drawing on observations it is apparent that nearly all the participating regions are currently involved into LNG-related initiatives, thus generating more or less an equal concern for LNG in the whole SBSR. Besides, by looking at the catalogue of initiatives and projects, these ones can be categorised in the same manner as the stakeholders and correspond to the respective LNG supply chain segments. Against this background initiatives have been launched and projects implemented in the following categories: bunkering (1), shipbuilding & repair (2), ports and infrastructure (3), shipping (4) and end-user oriented technologies (5). Table 30: Overview of LNG-related initiatives and projects across the South Baltic Sea Region Project specification

Building LNG Terminals and LNG onshore

Allocation to the category

Location in the SBSR

Ports and infrastructure

infrastructure

LNG in Baltic Sea Ports I & II

Ports and infrastructure

Baltic Sea Region

121

Project specification

Allocation to the category

Location in the SBSR

Clean Baltic Sea Shipping

Ports and infrastructure

Baltic Sea Region

North European LNG Infrastructure Project

Ports and infrastructure

Baltic Sea Region

LNG filling stations and small-scale bunker

Ports and infrastructure & end-user

solutions

oriented technologies

Bunkering liquid gases in German ports 2012

Bunkering

Fjord Line LNG ferries MS Stavangerjford &

Shipping, shipbuilding & end-user

MS Bergensfjord

oriented technologies

MS Viking Grace

Shipping, shipbuilding & end-user oriented technologies

Bunker vessels

Bunkering

POLAR

Shipping & shipbuilding

Gävle LNG terminal building by Skangass

LNG terminal and bunkering facilities

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Project specification

The port of Helsingborg has a long term goal

Allocation to the category

Location in the SBSR

LNG bunkering facilities

to be energy neutral by 2035 and one of its steps is to invest into LNG bunkering facilities

Trelleborg port is involved in consultation for

LNG bunkering facilities

investing into LNG bunkering facilities.

Sundsvall port is actively involved in detailed LNG design for infrastructure planning.

LNG onshore infrastructure

Trelleborg Marine is a company that develops equipment and machinery in the port and shipping industry. They are currently marketing equipment for the LNG sector.

LNG use for power supply for port

Project “Elblinien”

LNG infrastructure project in

infrastructure

cooperation with Becker Marine Systems and City of Hamburg

LNG Terminal / bunkering facilities in Hirtshals

Fjordline

LNG tankers

To be delivered by 2017 and ordered by Tarntank

Samsø small-scale bunkering unit at Hou harbour.

Bunkering facilities. Possibility to produce own BLG (with a CryoBox or similar)

Small-scale LNG Terminal in Klaipeda

Bunkering facilities. Feasibility study by Klaipedos Nafta

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Project specification

Expansion of LNG terminal in Świnoujśce by third LNG tank

Allocation to the category

Location in the SBSR

LNG bunkering facilities

Source: based on stakeholder profile data

At a closer look, the majority of the initiatives and projects refer to such segments as shipping, shipbuilding and end-user oriented technologies. However, worth mentioning is that some of the initiatives and projects can be allocated to the same segment, for instance, projects on building passenger ferries can be allocated to shipping, shipbuilding and end-user oriented technologies. The segment of LNG terminal and onshore infrastructure established as well as small-scale bunkering facilities are also emerging. To provide more detailed information at this point, the Danish, Swedish, Polish, German and Lithuanian regions have launched initiatives for LNG terminal sites and / or LNG bunkering facilities at respective regional ports, for instance, at Klaipeda (LT) and Swinoujscie (PL). Interests to introduce LNG-related activities have been also recorded in the context of Hirtshals (DK), Rostock, Brunsbüttel and Hamburg (DE), Gothenburg and Gävle (SE). When comparing the study results from 2013 and 2015, there is clear evidence that LNGrelated investment projects are constantly growing. From having only several projects concentrating in several regions, by 2015 the SBSR demonstrates strong competencies within the LNG field as well as contribution of the private sector, which has acknowledged the potential of LNG and value added for the environment. In this respect, the building up of the respective LNG terminals would enable to establish the SBSR LNG cluster and facilitate cross-border gas transfer, etc. In this particular case, of special importance is the project regarding new facilities of the gas pipeline between Swinoujscie and Szczecin and Szczecin-Gdansk. This project can be regarded as important trigger for the development of the cross-border gas transfer across the SBSR. In addition to the initiatives concerning the LNG terminals on national and regional level, there have been conducted sound projects in the SBSR. Such projects have been implemented on the interregional or transnational level and benefit for more regions and countries at the same time. Some of them were mentioned in the previous chapters, e.g. Clean Baltic Sea Shipping project or projects ascribed to the Swedish region. Regarding the project Clean Baltic Sea Shipping launched in 2011, this project has been part-financed by the European Regional Development Fund and European Neighbourhood and Partnership Agreement in the frame of the South Baltic Sea region Programme 2007-2013. In accordance with the EU strategies the project aims

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at developing clean shipping strategy, harmonising environmental differentiated port dues and developing technical solutions for the ports. Of special importance is in the context of this study development of technical pilot systems gas and LNG supply in Baltic Sea Region ports 55 . Furthermore, the SBSR records further projects relevant for LNG development that have been implemented on the transnational level and can be referred to as multi-country projects, as they involved more partners and regions from the SBSR and the adjacent regions, similar as in case of the Clean Baltic Sea Shipping. To mention some recent activities, the LNG in Baltic Sea Ports, which started in 2011, and the LNG Northern Europe Project run by Danish Maritime Authorities have gained resonance not only on national but as well as on international arenas. Regarding the project LNG in Baltic Sea Ports it was initiated to foster new a harmonised approach towards LNG bunker filling infrastructure across the Baltic Sea Region. This project emerged as a response to new sulphur content limits in marine fuels sailing in Emission Control Areas, covering, among others, areas of the Baltic Sea. Seven ports as partners from the Northern part of the Baltic Sea aim at developing port infrastructure to offer LNG bunker stations to ship-owners that are to a large extent missing across the Baltic Sea, what, in turn, hampers LNG business development56. In terms of the latter project, North European LNG Infrastructure Project, this project resulted in a feasibility study for an LNG filling station infrastructure and test of recommendations across the Baltic Sea, which was compiled in 201157. When looking at initiatives and projects on regional scale, all participating project regions record respective activities. Regarding Lithuania, Poland and Germany, most of the identified projects refer to the scientific-research array, whereas projects in Danish and Swedish regions can be treated as more business-oriented, since some of them have already resulted in “tangible” products or technological solutions. Nevertheless, since 2014, sound investments projects are planned and are likely to be equally distributed across the regions of the SBSR. To exemplify some of them, projects conducted in the Swedish region refer to development of reliable solutions for shipping and bunkering in case of using LNG. The project on LNG/FO Bunker vessel WS1 carried out by White Smoke Shipping AB and White Smoke AB aims at a technological solution with a flexible cargo configuration combining traditional fuels with LNG. As a result, designing and launching such a vessel enables change the cargo mixes in line with a

55

Clean Baltic Sea Shipping, 2013, http://www.clean-baltic-sea-shipping.com/project/background, accessed on 13 January 2013.

56

LNG in Baltic Sea Ports, 2013, http://lnginbalticseaports.com/en/about, accessed 12 January 2013.

57

North European LNG Infrastructure Project, 2011, http://www.dma.dk/SiteCollectionDocuments/Tema/LNGtender/Final%20Baseline%20Report_%20LNG%20Infrastructure_MGG_20111020x.pdf, accessed 12 January 2013.

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changing market, etc.58. Moreover, in the context of LNG, Sweden has been involved the projects on international standards for LNG bunkering and LNG STS Transfer Procedures59. Beside bunkering-related projects, Sweden demonstrates sound results in the shipping and enduser oriented technologies segment with the project Viking Grace. Fig. 39: MS Viking Grace passenger as novel technological LNG solution

Source: Viking Grace60

As a result of initiatives, there has been designed and constructed MS Viking Grace passenger / cruise ferry running on LNG and combined with traditional heavy fuel oil (dual-fuel and engine technology). It was build by Wärtsilä and represents a new generation of ferries. This ferry is owned and utilised by Viking Line (FI) and will operate between Turku (EE) and Stockholm (SE)61. Projects of similar nature have been carried out in Denmark. Design and construction of new generation ferries run on LNG by Fjord Line have brought already positive results. MS

58

LNG/DO Bunker vessel WS1, 2013, http://www.whitesmoke.se/en/shipping/ws1-lngfo-combo-vessel, accessed 12 January 2013.

59

White Smoke Consulting: Projects, 2013, http://www.whitesmoke.se/en/consulting/iso-tc67-wg10-pt1, accessed 12 January 2013.

60

Introduction to MS Viking Grace, 2012, http://www.vikinggrace.com/about/?lang=en, accessed 15 January 2013.

61

Viking Grace, 2013, http://www.vikinggrace.com/about/, accessed 15 January 2013.

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Stavangerfjord was put in operation between Bergen, Stavanger and Hirtshals in September 2013 and run exclusively by LNG with a single LNG engine. Since it will be the first cruise ferry in the world with single LNG engine employing environmental technology, avoiding emissions from sulphur or heavy metals, thus meeting all environmental standards, this technological solution can be labelled as an important stepping stone for further evolving of similar LNGrelated activities, what, in turn, accelerated LNG business development across the SBSR62. The second LNG cruise ferry MS Bergensfjord was launched in 2014. Fig. 40: MS Stavangerfjord LNG ferry with single LNG engine

Source: Fjord Line MS Stanvangerfjord63

Under scrutiny of Lithuania, it can be underscored that although the majority of the projects is allocated to the scientific-research array, scientific-research solutions have been already transferred into products and exploited. In this particular case it is important to mention LNG fuelled double-ended ferry Fjord1, which was built in cooperation of Norwegian and Lithuanian companies – Fiskerstrand BLRT AS and Western Shipyard in 2011 and delivered to Norway for operation in the Norwegian waterways.

62

Fjord Line: MS Stavangerfjord, 2012, http://fjordline.com/en/About-Fjord-Line/Media/Press-releases/230712-FjordLine-worlds-first-cruise-ferry-powered-by-natural-gas-alone/?backUrl=1, accessed 16 January 2013.

63

Fjord Line: MS Stanvangerfjord, 2012, http://fjordline.com/en/About-Fjord-Line/Media/Press-releases/230712Fjord-Line-worlds-first-cruise-ferry-powered-by-natural-gas-alone/?backUrl=1, accessed 15 January 2013.

127

128

Fig. 41: LNG fuelled Fjord1 ferry built in the Lithuanian shipyard

Source: Fiskerstrand BLRT AS, 2011.

Taking into account projects carried out in the German region, worth mentioning is the project POLAR – Production, Operation and Living in Arctic Regions – Rostock (2010-2013), where one of the key concerns is LNG ship and platforms building as well as LNG tanks and LNG peripheral system development for regions with extreme climate and geographical conditions64. Beside initiatives in the shipbuilding and shipping sector, the German region yields activities in terms of LNG bunkering. The Feasibility study on bunkering liquid gases in German ports 2012 elucidates current LNG infrastructure in North Europe and Germany as well as focuses on current stage of maritime projects in terms of LNG. As a result, there has been analysed and discussed the paradigm of logistics chain on the basis of one German sea port in the context of legal and competence-related conditions. Thus, this study implies respective conclusions and

64

POLAR, 2013, http://www.unternehmen-region.de/_media/WK_POLAR_web_bf.pdf, accessed on 12 January 2013.

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recommendations for further actions in terms of developing and anchoring LNG-related activities in Germany a well65. Although the addressed LNG-related initiatives and projects have gained positive response in public and private arrays across the SBSR, the effective realisation and sustainability of that ones is bound to several factors of influence that should not be ignored. More specifically, as elaborated in the Danish study “Maersk LNG / Maersk Marine Technology”, the focus is on investments for LNG infrastructure, specific investment projects, development of local LNG market with perspective to include possible synergies with land-based demand as well as European funding system for the development, construction and operation of LNG carriers and bunkers at the early market introduction stage. Based on the recent LNG-related discourses, bunkering possibilities and infrastructure solutions are evolving in the SBSR, since LNG as a marine fuel has been highlighted in many SBSR initiatives as well as echoed by the end-users.

65

Feasibility Study on bunkering liquid gases in German ports, 2012, http://www.bsh.de/de/Das_BSH/Presse/Aktuelle_Meldungen/Studie-LNG.pdf, accessed on 10 November 2012.

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6

1.

Comparative analysis of LNG development patterns in the SBSR LNG Value Chain Segment

Project start

Project end

Project involvement

LNG infrastructure

Terminals:

Terminals:

§

(terminals, onshore infrastructure & bunkering facilities)

Finland: -

Finland:

Sweden:

§

Trainings for personnel to develop basic LNG competences and secure LNG public acceptance.

Poland: -

§ § § § § §

Terminals: Technological road shows developing technological scope for small-scale terminals.

Sweden:

§

Lithuania: -

Developed LNG bunkering procedures for practitioners.

Denmark: -

§

Estonia: -

§ § §

Latvia: -

Germany:

Study visits to absorb knowledge on LNG bunkering procedures and exchange best practices to adapt to emerging LNG activities in the South Baltic Sea Region

§

Nynäshamn ++

Germany: -

§ §

Tahkoluoto / Pori: + Raum: + Turku: 0 Helsinki: 0 Hamina-Kotka: + Tornio: +

Gälvi: 0 Lysekil: ++ Gothenburg: 0

Rostock: 0 Hamburg: 0

131

LNG Value Chain Segment

Project start

Project end

Bunkering: Sweden:

§ § §

§

Poland:

Nynäshamn ++

Brunsbüttel: 0 Wilhelmshafen: 00 Lübeck: 00

Denmark: -

§

Lithuania: -

Lithuania:

Germany: -

FSRU Klaipeda Terminal:++

Poland: -

Denmark:

Estonia: -

§ §

Latvia: Finland: -

Project involvement

Swinoujscie: +

Hirtshals: 0 Hou: 0

Estonia: § §

Muuga (Tallinn): 0 Padalski: 0

Latvia: §

Riga: 0

Bunkering:

132

LNG Value Chain Segment

Project start

Project end

Project involvement

Finland: § § § § § §

Tahkoluoto / Pori: + Raum: + Turku: 0 Helsinki: 0 Hamina-Kotka: + Tornio: +

Sweden: § § §

Gälvi: 0 Lysekil: ++ Gothenburg: 0

Germany: § § § § §

Rostock: 0 Hamburg: 0 Brunsbüttel: 0 Wilhelmshafen: 00 Lübeck: 00

Poland: §

Swinoujscie: +

133

LNG Value Chain Segment

Project start

Project end

Project involvement

Lithuania: FSRU Klaipeda Terminal:++ Denmark: § §

Hirtshals: 0 Hou: 0

Estonia: § §

Muuga (Tallinn): 0 Padalski: 0

Latvia: Riga: 0

2.

LNG shipbuilding

21 ships

23 ships (different segments, such as ferries, bunker vessels, carriers, power supply barges, etc.)

§

Study visits to facilitate business partnerships in shipbuilding and infrastructure development fields.

§

Road shows to establish business partnerships on the technological level.

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LNG Value Chain Segment

3.

LNG shipping

Project start

-

Project end

Project involvement §

Public tenders implemented.

§

Created LNG value chain for shipbuilding

§

Fjordline

§

Promoting case studies.

§

Viking Lines

§

Created value chain for shipping stakeholders.

§

Samsø

§

§

AG Ems

Competence building and partnership platform to access knowledge on LNG technologies and businessto-business meetings including LNG trainings.

§

Knowledge gathered from the study visit at Stockholm Ports with AGA and transferred to the stakeholders and prepared bunkering procedures by the project.

§ Norlines

4.

Ports (regulations, port fees)

Stockholm (reduction of fees on lower sulphur emissions)

§

Gothenborg

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7

LNG-related value for regional development and future

prospects Regarding future prospects and interests observed in the SBSR, there can be differentiated technical / technological, economic, legal and environmental interests. In general terms, LNG and increased involvement into LNG-related activities would stand for an attractive technological solution contributing to the environmental compatibility and resource efficiency. Since all participating projects regions are bound to the implementation of sulphur limits as of 1st of January 2015 as a result of having designated sulphur emission control areas in the Baltic Sea, where special requirements have to be fulfilled in terms of sulphur content by the shipping industry, LNG constitutes plausible environmental-friendly approach for shipbuilding and shipping sectors. As a result, ship owners are confronted with several options to meet the requirements mentioned. Since LNG and LNG fuelled engines have positive effects both on the environment, energy efficiency and economy, shipbuilding industry sees shifting to LNG as a plausible technological solution in order to trade in the Baltic Sea in the near future66. From 2020, the sulphur limit has been set at maximum 0.5% worldwide. This will have again effects on the shipbuilding and shipping industry. Despite the fact that environmental regulations are getting stricter, currently shipbuilding and shipping stakeholders are still considering introduction of LNG and related technologies into their business taking into account the LNG price and investments concerned. Marine Diesel Oil (MDO) is one of the solutions used currently. However, MDO produces higher NOx and does not seem to solve environmental problems in a long-term perspective. Another possibility is to use Marine Gas Oil (MGO). However, it is expected to be more costly in a long-term than LNG. Similarly, the use of scrubbers does not seem to have solved the problem entirely. Also the utilisation of scrubbers in the SECAs is likely to reduce the emissions as required according to the environmental regulations. Nevertheless, this technology generates sewage, which enters the water and thus jeopardise the maritime ecosystem. By drawing on the study published in

66

DNV, Greener Shipping in the Baltic Sea, 2010, http://www.dnv.fi/Binaries/Greener%20Shipping%20in%20the%20Baltic%20Sea_tcm146-429433.pdf, accessed 15 October 2012, p. 3.

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December 2014 by the German Federal Environmental Agency, as a result of scrubber utilisation, there have been observed short-term and pH value decrease in the specific marine areas studied in the North and Baltic Sea, temperature increase and turbidity in the water as well as concentration of hazardous materials in the water from the treatment procedures67. Further, scrubbers removing sulphur from the engine exhaust increase power consumption, thus increasing CO2 emissions68. There is a need to develop and operate a system of scrubber wash water management system. So far, the utilisation of this technology does not seem to be more environmentally friendly, and, again, LNG is likely to bring with it more advantages for the environment. Regionally, LNG development will strengthen. The future perspective of the use of LNG for the Danish region – if the infrastructure is established in the port environment by the shipping related stakeholders – would be stakeholders in the immediate surrounds of the ports. The most likely scenarios are the use for other port operations (such as vehicles, cranes, machinery, etc.) to also use LNG and possibly to combine this with filling stations for trucks, busses and municipally owned service vehicles (road maintenance vehicles, elder service vehicles, food supply, etc.). To feed LNG in its re-gassed form into the grid system for power supply is also a possibility although not economically viable at the current marked prices. Similarly is the value of LNG for better environmental status estimated in other regions. For example, in Poland, there are two big complexes of seaports: Szczecin-Świnoujście, GdańskGdynia and a few smaller ports mostly used by fishing vessels. Additionally, the main ports are connected with south part of Poland by inland waterways. The inland waterways very often intersect cities or the environmental protected areas, e.g. Natura 2000). Developing of LNG in the water transport can significantly reduce emission of pollutant gases in these places and multiplier positive effects in terms of environmental protection. Many of the Polish cities suffer from smog, which is mostly caused by exhaust gases from vehicles and houses. The use of LNG for the public transport instead of diesel can significantly improve quality of air. The local LNG stations can be used to supply households without connection to the natural gas grid, which also will positively influence air quality. From the economic security and political perspective, LNG has been associated with attractive energy solutions for project regions, especially in order to meet energy demand. In case of the

67

Umweltbundesamt, 2014, Auswirkungen von Abgasnachbehandlungsanlagen (Scrubbern) auf die Umweltsituation in Häfen und Küstengewässern, p. 2.

68

M. Bagniewski, 2010, LNG Fuel for ships. A chance or a must?, DNV Report, http://www.dnv.pl/Binaries/LNG%20fuel%20for%20ships_tcm144-520589.pdf, accessed 20 April 2015, p. 2.

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Eastern South Baltic Sea regions (Lithuania and Poland), an increase in the economic interdependence reflects an important trigger to proceed to LNG. As argued in the DNV brochure advocating greener shipping in the Baltic Sea, LNG provides with the best economic performance, since new shops with LNG engines usually have an added investments costs of 10-20 per cent, LNG technological solution has the lowest present value of costs as compared to scrubber or Marine Gas Oil (MGO) option and constitutes economic advantages against the background of increasing fuel consumption69. As experiences in 2014 in Lithuania show, the opening up of the LNG terminal in Lithuania had positive effect in terms of natural gas delivery price development. There has been strong decrease in natural gas price from the supplier Gazprom for Lithuania: from 580 USD per 1.000 m3 (2013) up to 360 USD per 1000 m3 (2014). Before launch of the LNG terminal in Lithuania, Lithuania, Klaipeda purchased 100% o natural gas from Gazprom, i.e. approx. 2.5 Billion m3 per year. The practice, however, shows that during the year 2014 Lithuania saved 550 Million USD on the difference of the gas price. This value exceeds the Lithuanian LNG terminal building price including the FSRU. As a result of such positive experiences, new LNGrelated projects are planned to be realised in the next future. New LNG players will enter the market to use LNG as a fuel in different transport modes as well in the energy sector, thus affecting the natural gas prices in all the East Baltic Sea regions. Besides, LNG is advocated economically because an increase of LNG activities would accelerate entrance of the SBSR into the global LNG market, thus boosting growth of innovations and employability. In this context, LNG pricing appears to be of great interest, since competitive and sound LNG prices would facilitate the adoption of LNG to for the shipping industry. Against this background, reasonable LNG pricing can be regarded as one of the core future prospects in the SBSR. Taking into account safety-related issues in terms of LNG, LNG adoption can be favoured as well. Technical obstacles and triggers to implement LNG solutions have been eliminated, and respective records reveal safe operations by using LNG through the past 40 years without any major safety incidents70. Furthermore, flexible technological solutions associated with LNG constitute another positive impulse for switching towards LNG. LNG fuelled engines can be designed and manufactured in

69

DNV, Greener Shipping in the Baltic Sea, 2010, http://www.dnv.fi/Binaries/Greener%20Shipping%20in%20the%20Baltic%20Sea_tcm146-429433.pdf, accessed 15 October 2012, pp. 6-7.

70

Ibid., p. 6.

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two ways: duel fuel engine, which runs both on LNG and conventional fuel, and single LNG engine. In this particular case, duel engine solutions provide with flexibility, as in cases of LNG shortage, ships can run on conventional fuel. Besides, when using dual engines, the consumption of conventional fuel in LNG mode is minor71. Since technically there can be adopted two concepts for introducing LNG in the shipbuilding industry, that solutions leave enough room for technological manoeuvring and adoption. Bearing in mind these considerations, one of key interests articulated in the project regions is the establishment of LNG infrastructure in order to enable the shipbuilding and shipping industry to enhance adoption to LNG technological solutions. From building up LNG terminals, there can be seen further future prospects, such as alternative gas supply possibilities, energy safety, decrease of natural gas prices for the end users, synergies of involved industries and evolvement of new services required. Fig. 42: LNG-fuelled Solbus for public transport

Source: Gazprom Germania72

71

Ibid., p. 8.

72

Adapted from Gazprom Germania, https://www.gazprom-germania.de/uploads/pics/LNGBus_GPG_Solbus_Drive.jpg, accessed 20 April 2015.

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As the practice already demonstrates, by having established LNG relevant infrastructure, LNG industry and business stakeholders are likely to shift towards LNG, as it bears not only environmental obligations to the actors, but as well as economic viability (e.g. efficiency of using LNG). The operational practices yield that LNG-driven solutions are already established in the public transport sector (e.g. LNG-fuelled buses in Poland), automobile industry (LNG-fuelled trucks). LNG utilisation is planned for industry applications in all the participating regions as well as environmentally friendly onshore power supply in harbour regions. Fig. 43: LNG-fuelled truck Mercedes Benz Econic LNG

Source: Mercedes Benz, 201573

One of the key recent trends is application related to liquefied bio-gas (LBG). There are already developed concepts to introduce LBG in trucks technology. However, most promising seems to be the use of this technology in order to strengthen the positive effects on the blue and green growth across the Baltic Sea. LBG plants (infrastructure) is also planned on the regional scale. LBG brings itself not only efficiency advantage, but also more environmentally friendly application, thus significantly reducing environmental impact and enabling to improve the environmental status of the Baltic Sea.

73

Adopted from Mercedes Benz, http://www.neuereconic.com/fileadmin/downloads/econic/mm_econic_7_1920x1024.jpg, accessed 20 April 2015.

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8

LNG-related challenges in the next future

By drawing on the insights extracted from the information it may be stated that there can be distinguished diverse challenges in terms of LNG: time-specific, supply-related, technological, regulative / legal, political, economic, safety-related and social challenges. Generally, the main challenge the SBSR is facing refers to the establishment of the fully-fledged LNG value chain. From the analysis of existing capabilities in the SBSR, it is apparent that the LNG value chain of the SBSR is on development stage, as several segments of the supply chain the SBSR are restricted by respective competences and capabilities. As a result, developing LNG infrastructure, enhancing capabilities in the shipbuilding and shipping industry as well as accelerating end-user oriented technologies are of paramount importance in the near future. The main obstacles for developing LNG business are very few of end-users. There are no any direct government subsidies to support necessary investments. Also the risk to develop such an infrastructure is high, especially due to the rapid changes of prices on the fuels market. Nevertheless, the public acceptance for the LNG is growing. Nowadays, even before opening the terminal, local society looks at this investment much more friendly. This good relation should be now extended across the regions of the South Baltic Sea area. Additionally, another challenge is to convince people that LNG can be used not only as an energy source for cooking and heating but it also can be used for fuelling different types of vehicles, power supply and manufacturing / producing industries. It will bring more end-users and will result in decreasing unit price of LNG. Furthermore, LNG should be indicated as the clean and safe fuel. This aspect becomes more and more important for people, whose life depends on touristic attractiveness to their hometowns. Concerning the time-specific challenges, there have been addressed such issues as too short time frames for stakeholders to undertake capital investments, as investments appear to be one of the main concerns in the business discourses. Besides, bearing in mind the fact that legal requirements have entered into force in 2015 and 2016, shipbuilding and shipping stakeholders are forced to search for optimal technological solutions and adapt to the changing legal environment more quickly. Time sensitive is also the issue of bunkering procedures in ports, since the operators of LNG ships, especially passenger ferries, have to calculate additional time for LNG bunkering, as simultaneous bunkering and embarking or disembarking constitutes a concern from the safety perspective. For LNG operations to be more time-efficient, there is a need for a coordinated approach among stakeholders involved in the LNG-related infrastructure establishment: ports, maritime authorities, national / regional administrations, rescue services, fire fighting services, municipalities, transport administrations and product / service delivering stakeholders. As the best practice in the Ports of Stockholm shows, LNG

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bunkering procedures are much more time-sensitive as a result of missing regulations and coordination. With having established and applying a roadmap for LNG bunkering and handling onshore, the operations are likely to become more effective and efficient. In terms of supply-related challenges, there is only limited LNG infrastructure yet capable to meet the supply side in the SBSR. The supply, however, can be ensured on the East Baltic Sea coast as a result of the established LNG terminal in Lithuania and potential supply of LNG to the neighbouring countries. With the establishment of the LNG terminal in Poland the demand for LNG across the SBSR can be met. Since there have been declared concrete intentions to increase the use of LNG, a rising use requires and appropriate supply infrastructure. A reciprocal relation between these two determinants is crucial. By drawing on DNV observations, shipowners will not make any investments into the LNG vessels until there is no LNG fuel supply infrastructure. Moreover, LNG fuel suppliers are not keen to invest into the infrastructure until there exist a sound number of LNG-fuelled ships74. Pertaining to the technology-related challenges, ship classification appears thwarting the maritime LNG sector to some extent, since vessel sizes are rising, liquid motion and sloshing inside LNG membrane tanks are becoming more important, and routes with the filled cargo tanks are increasing as a result of increased vessel sizes. Furthermore, technological solutions for using LNG are technologically intensive, for instance, liquefaction of LNG, etc. LNG fuelled ships are bound to design and implementation of very sophisticated system incorporating special fuel tanks, vaporisers, double insulating pipes, available space for cylindrical LNG fuel tanks on board and shift towards hull integrated tanks. In addition, the shipbuilding industry is currently struggling with elimination of the so-called methane slip, where a small trace of gas fuel passes non-combusted through the engine and is thus emitted with the exhaust gas, as well as the technological challenge to develop non-cylindrical tanks suitable for fitting in hulls with less available space, thus decrease the size of the ship, respectively75. Moreover, issues related to ship design that are safe are also of particular importance. In this respect, constraints of bringing new developed technologies decreasing environmental impact, such as leak of not burned natural gas from the engines into the air and increasing energy efficiency to the market or get it down to the business shape the current discussions. Regulative or legal challenges appear to be most common across the SBSR. Safety reliability, environmental risks and risk analyses, safety aspects including new safety regulations, for instance, allowing bunkering while passengers are on board, etc., as well as compliance with the

74

Ibid., p. 11.

75

Ibid., pp. 6-8.

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international regulations and the EC Directives are sensitive issues to be discussed and clarified. Besides, with the in the Baltic Sea established SECA, these regions are bound to emission reduction requirements. The fuel sulphur content of any ship in the SECA after 1st of January 2015 cannot exceed 0.1 per cent or the exhaust gas must be purified to an equivalent level76. Besides, design and adoption of regulations referring to compatibility and classification of LNG ships, certification rules and standards, harmonised procedures on competence building and unified courses seamen training enhance regulative challenges, since these ones are currently to a large extent missing. Furthermore, in addition to the international regulations mentioned above, there is a need to introduce or revise national and port regulations, especially in the face of new developing LNG infrastructure. Related to the LNG infrastructure is the regulation pertaining to bunkering procedures. At present, there has not been recorded any harmonised international standards for LNG bunkering operations and bunker stations elucidating risk analysis and risk management. Respective projects are on research and development stage. Similarly as with the regulative challenges, political ones are common for some project regions. Of specific concern tends to be the political will to support LNG-related initiatives. Problematically has been assessed the involvement of local businesses and scientists. There has been observed the tendency of clear position and political incentive by the respective authorities that could provide with the baseline leading towards introduction of support structures to acquire regulations and boost LNG development. Politically the will for greener and cleaner solutions are present across the regions of the Baltic Sea. However, the lack of set regulations when it comes to the handling and use of LNG poses a serious issue and is a slowing factor when it comes to the establishment of LNG infrastructure. Beyond this, as it was frequently mentioned in this study, investments, cost savings and further financial concerns related to the utilisation of LNG can be allocated to the LNG-related challenges in the SBSR as well. Additional costs for adopting LNG in the shipbuilding and shipping industry are accumulated through the need to introduce sophisticated LNG storage tanks, fuel piping system and storage ships as well. As a result, investments into LNG fuelled ships as compared to MGO will shoot up the costs. In this light, inducing shipbuilding industry stakeholders shifting to LNG is very challenging aspect at present. Beyond this, LNG price uncertainty jeopardises investments in to LNG. Nevertheless, it is noteworthy that financial concerns are at stake not only in the SBSR. It is a topical subject in the pan-European discourses as well. Bearing in mind safety and security issues, LNG has been frequently cited in the context of higher risk associated with the liquefaction of LNG, LNG carrying, operation of LNG fuelled

76

Ibid., p. 5.

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ships, infrastructure and design of ships, etc. However, there are being conducted projects focused on meeting technical safety or other regulative requirements as well as pointing to the fact that potential risks and consequences are identified, analysed and assessed. Important is to mention the challenge pertaining to the perception of LNG and related activities in the public sphere, since it is being hard to meet the public expectations on safety when dealing with LNG. As a result, there is a need for effective safety and environment-related initiatives that would underscore minimal accidents risks and damage-free operations as well as handling of LNG with no consequences for the environment and the public. Thus, increasing public awareness of LNG and public acceptance of new technological and safe solutions should be treated as significant current and future challenge when compiling the challenge catalogue and therefore communicated by stakeholders to the public when entering into LNG-related activities across the SBSR.

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Conclusions Based on evolvement of LNG as a fuel and new science and business opportunity in the South Baltic Sea Region as well as under scrutiny of past and current development patterns there can be drawn a series of conclusions. These refer to the respective segments of the LNG value chain in the SBSR discussed as well as can be traced back to the knowledge generation and transfer portfolio accumulated in the SBSR. The general concluding overview can be gathered from the map generated after having analysed and discussed LNG-related development across the SBSR. As it is apparent from the map, the Swedish and Lithuanian parts of the SBSR do yield LNG-related activities (marked blue). Polish, other Swedish and Danish regions are currently involved into activities leading to emergence of LNG terminals (marked green). Nevertheless, the Danish region, i.e. Samsø municipality does record LNG activities – LNG-fuelled duel fuel passenger ferry. As yellow marked have been identified such locations / ports that due to sound accumulated knowledge and competences bring with them high potential for LNG development and are therefore recommended to enter into LNG business area in the near future. Some of the projects are planned and development, whereas others are planned but not finally decided, yet. In this light, the analysis of education, research, training and consulting portfolio in the SBSR unveils comprehensive and competent knowledge in dealing with LNG and LNG-related technological solutions, a variety of diverse initiatives, either research studies or projects and sound cooperation patterns. The institutional shape in the SBSR is highly driven by investments and constitutes a significant number of research institutions as a result of infrastructural projects that have been conducted in these particular regions. As a result, such institutional situation catalyses possibilities for specialisation, and all respective competence gathered in the frame of the regional projects may be maintained and developed for the purpose to provide the breeding grounds for the evolvement of services that are capable to compete in foreseen markets and projects. What is lacking here when taking into account the institutional shape is, however, demand form the business side on further scientific-research projects. Nevertheless, reciprocally this is jeopardised by the fact that since there is limited access to the LNG in the region, the demand from the business side remains limited as well.

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Fig. 44: Tracing LNG development in the South Baltic Sea Region

Tornio

Finland

Tahkoluoto / Pori Raum Kotka

Turku Helsinki

Sweden

Stockholm

Padalski Nynäshamn

Tallinn

Estonia

Lysekil Göteborg

Hirtshals

Riga

Latvia

Aarhus

Helsingør Samsø Malmö Esbjerg København

Baltic Sea

Lithuania

Rønne

Denmark

Klaipeda

Rødbyhavn Stralsund Brunsbüttel

Lübeck

Rostock

Hamburg Wismar Wilhelmshafen

Swinoujscie

Szczecin

Gdynia Gdansk

Poland

Germany

Source: own draft.

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When taking into account single segments of the LNG value chain of the SBSR, conclusions can be drawn in terms of five stakeholders group absorbing LNG-related knowledge in the SBSR, as discussed in the previous chapters of this study. Therefore, the region records very limited extent of bunkering-related operations that are concentrated in the Swedish project region. Against this background, without any substantial bunkering infrastructure the development of the LNG value chain is deemed to freeze. Lacking LNG bunkering and storage solutions keep end-users from entering LNG-related activities in the SBSR and consequently hampers the development of end-user oriented technologies. Without any bunkering facilities stakeholders from shipbuilding and shipping industry are not keen on investing into LNG fuelled ships, and end-user technology providers are not willing to invest into technologies and introduce them in the SBSR. As a result, bunkering and storage constitute the most sensitive part of the LNG supply chain of the SBSR. As the Lithuanian experience shows, with the establishment of LNG infrastructure (LNG terminal in Klaipeda), the way has been opened up for developing LNG bunkering infrastructure – LNG small-scale bunkering facility is planned to be established in Klaipeda. When compared with the bunkering solutions, the shipbuilding and shipping sector yields solid development patterns, thus leading to the limited demand. SBSR ports and their infrastructure are subject to extensive support, as it is apparent from the observations gathered. On the one hand, ports have being searching for “green” and regulative solutions. On the other hand, ports are facing high demand, since they lack sound infrastructure, which would accelerate LNG activities. Therefore, one of the key prospects for the ports is to place the focus on establishing bunkering solutions, what, in turn, would generate positive effects in terms of meeting the increasing demand for bunkering infrastructure, thus attracting LNG industry stakeholders to the region. With regard to the shipping industry, a concern refers to the SBSR ship-owners. In the face of prevailing global trends and shifting business environment both globally and regionally, they should take the responsibility for the environment and do lay the grounds for formalising respective regulations. An obvious reciprocal correlation between the shipbuilding and shipping industry and the ports should be seen as a chance to launch novel solutions. Finally, in terms of the end-user technologies, observations gathered reveal the demand for such technologies. In order to anchor LNG use as a novel solution in the SBSR, it is not enough to be equipped with shipbuilding and shipping related solutions for LNG adoption. Important is this light enhancement of onshore technological solutions, such as LNG in the context of port operations, road and public transport. Established LNG filling stations, LNG storage and transport solutions such as LNG trucks or LNG containers will strongly increase the demand for LNG, what in turn, will accelerate the development of the LNG supply chain in the SBSR.

147

Summary in German Die vorliegende Arbeit stellt die grundlegenden Eckpfeiler der Wissens- und Kompetenzentwicklung im südlichen Ostseeraum in Bezug auf das Flüssigerdgas (LNG) dar. Unter Betrachtung der aktuellen einschlägigen Entwicklungsmuster im Bereich der regionalen LNG-Wissens- und Kompetenzbildung basiert diese Arbeit auf einem für diese Studie entwickelten methodischen Rahmenkonzept, das eingesetzt eine umfangreiche Analyse und Diskussion des in der Region gesammelten LNG-bezogenen Fachwissens, des Leistungsvermögens der LNG-Lieferkette sowie der heutigen und zukünftigen Engpässe und des Einsatzpotentials hinsichtlich LNG präsentiert. Das LNG Wissens- und Kompetenzportfolio, welches die Kompetenzen, Möglichkeiten und Fähigkeiten der Bildungs-, Forschungs-, Trainingsund Beratungsinstitutionen aus der südlichen Ostseeregion widerspiegelt, erfasst alle in den jeweiligen Projektregionen angesiedelten Institutionen, welche im LNG-Bereich wichtige Bildungs-, Forschungs-, Trainings- und Beratungsaktivitäten verzeichnen sowie das größte Potential für die LNG-Aktivitäten aufzeigen. Ergänzt wird dieses institutionelle Portfolio durch die Informationen über Kompetenzbereiche der Institutionen, welche in Bezug auf LNG von denen nicht abgedeckt sind. Zusätzlich werden die Möglichkeiten erörtert, welche sich für die Wissenschaftler, Forscher und Akademiker durch deren Beteiligung an LNG-Aktivitäten eröffnen, sowie die Einblicknahme in die institutionellen, finanziellen, rechtlichen. etc. Herausforderungen gewährt, denen die erfassten Institutionen ausgesetzt sind. Mit der Erweiterung der institutionellen Dimension durch die Untersuchung der maritimen Lieferketten im südlichen Ostseeregion wurde im Rahmen dieser Studie eine LNG-Lieferkette für den südlichen Ostseeraum herauskristallisiert. Präzise Darstellung finden in diesem Zusammenhang Aspekte der LNG-Infrastruktur und deren Entwicklung, LNG-Produkte und Dienstleistungen sowie relevante LNG-Forschungsprojekte, die umgesetzt wurden bzw. sich im Entwicklungsstadium befinden. Durch eine Verankerung der Wissenspotentials und- Transfers (wissenschaftliche Dimension) mit der wirtschaftlichen Seite, d.h. Aufnahme und Integration dieses Wissens in die wirtschaftliche Aktivitäten (wirtschaftliche Dimension), wird mit diesem Vorhaben das Ziel verfolgt, eine Lücke in Bezug auf die Interaktionen zwischen Wissenschaft / Forschung und der Wirtschaft zu schließen und somit das gegenseitige Zusammenspiel hinsichtlich LNG in der Region zu optimieren. Unter Betrachtung der vorliegenden Kapazitäten im Wissensbereich und Wirtschaftssektor plädiert diese Studie für LNG als eine attraktive und plausible Geschäftsmöglichkeit in der südlichen Ostseeregion. Die gewonnenen und erörterten Beobachtungen können demnach als Anstoß und gutes Beispiel dienen, um mehr Resonanz bezüglich LNG im unternehmerischen Umfeld sowie in der breiten Öffentlichkeit zu gewinnen. Erschließung neuer LNG-Aktivitäten in den Projektregionen Litauens, Polens, Dänemarks, Deutschlands und Schwedens, welche zum heutigen Zeitpunkt von einer moderaten Beteiligung im LNG-Bereich geprägt sind, bzw. Stärkung der eingeleiteten Aktivitäten in den jeweiligen

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Projektregionen, die bereits eine einschlägige Mitwirkung hinsichtlich LNG aufzeigen, eröffnet eine verheißungsvolle Perspektive für die südliche Ostseeregion aus wissenschaftlicher und wirtschaftlicher Sicht, die sich in eine Zunahme von Kompetenzen, Leistungen und Wettbewerbsfähigkeit in Bezug auf LNG für die ganze Region ergeben wird.

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Summary in Polish Niniejszy dokument omawia rozwój wiedzy oraz kompetencji związany z technologiami ciekłego gazu naturalnego (LNG) w Regionie Południowego Morza Bałtyckiego (SBSR). Dokument ten powstał w oparciu o badania, w których ramy metodologiczne stworzone dla celów analizy regionu umożliwiły odzwierciedlenie nie tylko jego stanu i potencjału w aspekcie rozwoju wiedzy związanej z technologiami LNG oraz możliwościami łańcucha dostaw LNG, ale również obecnych i przyszłych przeszkód i trudności. Zgromadzony przez odpowiednie instytucje edukacyjne, badawcze, szkoleniowe i konsultingowe zasób wiedzy i kompetencji w zakresie LNG ujawnia, które z nich oraz które części SBSR przedstawiają wysoki potencjał możliwy do wykorzystania w działalnościach związanych z LNG, jakich kompetencji i wiedzy brakuje, jakie są szanse dla nauki i środowiska akademickiego oraz z jakimi wyzwaniami muszą sobie poradzić. Poszerzając instytucjonalny wymiar SBSR przez zbadanie morskich łańcuchów dostaw występujących na jego obszarze, artykuł charakteryzuje rozwijający się łańcuch dostaw LNG dla SBSR i możliwości jego wykorzystania na powiązanych z LNG polach działalności, takich jak infrastruktura LNG, związane z LNG produkty i usługi jak również stosowne projekty badań. Przez połączenie ze sobą rozwoju (wymiar naukowy) i absorpcji (wymiar biznesowy) wiedzy ustala cele badań, służące zapełnianiu pustki istniejącej pomiędzy nauką/akademią i biznesem. Wykorzystane w badaniach aktualne możliwości nauki i biznesu na obszarze Południowego Regionu Morza Bałtyckiego wskazują na LNG, jako pewny sposób prowadzenia działalności w regionie. Zgromadzone i przedyskutowane w tej pracy obserwacje mogą posłużyć, jako bodziec do zwiększenia dyskusji o LNG w obszarze działalności biznesowej. Rozpoczęte już w chwili obecnej działania w branży LNG w regionalnych częściach SBRS wykazują na przeciętne zaangażowanie do działań w tym obszarze aktywności lub wzrost aktywności w branży LNG w rejonach, w których zarejestrowano, że przeprowadzone dyskusje związane z LNG osiągnęły obiecujące rezultaty, które z kolei były czynnikiem powodującym wzrost kompetencji i możliwości w całym SBSR w odniesieniu do branży LNG.

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