Economic analysis of trans-ocean LNG-fueled container ship

Abstract

This paper proposes concepts and economic analysis of 9,300 TEU (Twenty-foot Equivalent Unit) trans-ocean container ship fueled by LNG, sailing between Asia and Europe, based on the design of existing container ship fueled by bunker oil. For a quantitative comparison, three projects complying with IMO Tier III NO x emission regulation are made: oil-fueled ship with selective catalystic reduction (SCR), LNG-fueled ship with low-speed diesel engine directly coupled to the propulsion system, and LNG-fueled ship with medium-speed diesel electrical propulsion system. Moreover, parameters for the economic analysis study are evaluated by the market research and the general information: initial shipbuilding cost, freight revenue, operation expenditure, and fuel cost. Economic analysis by discount cash flow method shows that the project of LNG low-speed diesel ship is more attractive investment than the project of the oil-fueled ship with SCR. Supposing that life time is 20 years, net present value of each LNG ship is larger than that of the oil-ship at the end of the projects. Moreover, refund time to payback initial cost for the LNG ship is shorter. This result is confirmed by the market price of LNG.