Economic feasibility study due to implementation of dual fuel engine of mini-LNG carrier in LNG distribution to power plants in Bali and Lombok

Abstract

The fact that the maritime transport contributes 2.8% of global greenhouse gas (GHG) emissions challenges the ship to reduce the CO2 emissions. International Maritime Organization (IMO) requires limiting the sulphur to 0.5% m/m in the fuel oil used on board ships operating outside designated emission control. One of strategies to comply the IMO regulations is by using the alternative fuels which may contain low or zero sulphur for ship main engine and that is liquefied natural gas (LNG). Instead of retrofitting the diesel engine which economically requires higher cost, engine conversion to dual fuel diesel engine is preferable in this study. Before the conversion of dual fuel diesel engine is implemented, the feasibility study should be performed, both technically and economically. This study focused on the economic analysis due to conversion of dual fuel engine using LNG fuel. The study case in this research is the plan of dual fuel engine conversion of Landing Craft Tank (LCT) as mini-LNG carrier for distributing the LNG ISO tank to power plants in Bali and Lombok. The economic analysis in this study was carried out to adjust several components in Capital Expenditure (CAPEX) and Operational Expenditure (OPEX) that occurred due to dual fuel engine conversion. Finally, the result of this papers shows that the dual fuel engine conversion for mini-LNG carrier for gas distribution is economically feasible since it gives the smaller cost compared to diesel engine.