Dry bulk shipowners cautious on alternative fueled vessels

Both Thai-listed Precious Shipping and Nasdaq-listed Seanergy Maritime explained to the conference why they are holding back from ordering alternative-fuelled vessels.

Khalid Hashim, Managing Director of Precious Shipping, which owns and operates bulkers in the handy to ultramax range, share their experience in investigating alternative fuelled newbuildings.

He said that the company had approached its shipbuilder about the price differential between a conventional fuelled newbuilding for an ultramax bulker and a vessel that was alternative fuel capable such ammonia or methanol.

The yard said the price for a conventional fuelled newbuilding would be somewhere between $33 - $35 million today and $45 - $47 million for a vessel with an alternative fuelled engine. However, the alternative fuelled engine vessel would only be available for delivery in 2028 – 2029 where as newbuild with a conventional engine would be available for delivery in 2026.

There is also an issue of fuel availability given the wider range of ports with which Precious’ vessels trade with. “We’re a pure tramp operator and in that sense our ships just go where the cargo takes us and you need to have the alternative fuel for it.”

He said that taking in account all those factors and despite fact the secondhand prices are high they could sell an older vessel in the fleet and replace it with a secondhand vessel of between 8 – 10 years old which is larger deadweight ship and give much lower CO2 emissions for the cargo carried.

Precious has contracted four ultramax newbuildings with conventionally fuelled engines.

In an interview session at the conference Stamatis Tsantanis, CEO of Seanergy Maritime Holdings, stated: “We never wanted to become the guinea pig of alternative fuels to me it’s a wrong move.”

He explained, “There is no need to reinvent the wheel that this vessel will be converted to ammonia or hydrogen in the future, which in my opinion may not be sustainable in the future from a financial point of view. Until we see a solution that is proven and is working… that applies to the vast majority of vessels we are not going to be moving to that.”

Seaneargy has instead opted for making existing vessels more economical, something Tsantanis says they have been very successful in doing. The company started experimenting with tried and tested technologies such as Mewis Ducts. He said the biggest saving had come from silicon coatings which resulted in 8 – 10% improvement in fuel consumption.

“So why go crazy with things that are uncertain, cost a lot of money, and you never know how these things will play out.” Instead, he said it made more sense use existing solutions that work perfectly fine.