Using grey methanol, ammonia and hydrogen made from unabated fossil gas will generate more greenhouse gas emissions than the conventional fuel alternatives they are replacing, according to industry lobby coalition SEA-LNG.

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“This means they are not viable solutions for decarbonisation even in the short term,” it says in its A View from the Bridge report for 2023-24.

The body said any methanol, ammonia and hydrogen used by shipping will need to be green or at least blended with green fuels just to achieve emissions parity with very low-sulphur fuel oil (VLSFO) and comply with new regulations like the European Union’s FuelEU Maritime (see panel below).

SEA-LNG calculates that the demand for methanol as a marine fuel will amount to almost 14 million tonnes per annum by 2028. But it said green methanol production is currently about 6% of this, at just 0.75 million tonnes a year.

The body quoted The Methanol Institute as estimating green methanol production could expand to eight million tonnes a year by 2028 but pointed out that not all of this will be made available to shipping.

“Does this mean dual fuel methanol vessels will utilise grey methanol or VLSFO?” the report asks. “Neither choice helps the environment but rather exacerbates the climate problem.”

The 26-page report goes on to contrast the lack of methanol bunkering facilities with those for LNG.

The lobbying group — which is made up of companies across the “whole LNG marine fuel value chain” — also argues that the bulk of green methanol production projects are based on using biomethane, which can already be used as bio-LNG. It claims the conversion is about 65% efficient, compared with a 95% efficiency to liquefy biomethane to make bio-LNG.

“Significant quantities of precious green energy will be consumed to make a more expensive fuel, bio-methanol,” the body said. “This does not seem to make sense, environmentally or commercially.”

In contrast, SEA-LNG claims that even using fossil LNG as a marine fuel offers immediate reductions in greenhouse gas emissions of up to 23% on a well-to-wake basis, inclusive of methane emissions, when compared to VLSFO.

It also has a higher energy density — about twice that of ammonia and methanol and four times as much of liquid hydrogen.

According to maritime classification company DNV, as of December 2023, there were 469 LNG-fuelled ships — excluding LNG carriers — in operation, with a further 537 on order.

However, DNV noted earlier this month that only 130 LNG-fuelled ships were ordered in 2023, a drop of more than 40% from the 222 orders in 2022, while methanol dual-fuel vessels dominated alternative propulsion orders at 138 (also excluding carriers).

While SEA-LNG contrasts in its report the well-to-wake emissions increase from VLSFO for grey methanol, ammonia, and hydrogen compared to directly using fossil LNG, it has not published figures for equivalent green options — although it plans to share findings from a study looking at alternative marine fuels in future.

'No stranded assets'

As with any fossil gas-based fuel, LNG also comes with the significant drawback of upstream methane emissions, while using it as a fuel comes with the risk of “methane slip”, where the gas can escape into the atmosphere from storage, pipelines and engines.

SEA-LNG argues that “considerable progress” has been made in tackling this and engine manufacturers are “confident” it will have been resolved by the end of the decade.

The report declares LNG as “safe and operationally proven”, with existing infrastructure and its green alternatives, either from biogas or derived from renewable hydrogen, able to be blended in for use on existing LNG-fuelled vessels. “There are no stranded assets,” the group said.

“LNG offers immediate greenhouse gas reductions and the lowest cost of compliance with European and IMO [International Maritime Organisation] regulations,” according to the report, which also noted that “bio-LNG has the lowest production costs of all alternative marine fuels and is increasingly available”.

The body detailed that current global biomethane production amounts to 30 million tonnes per year, which if converted to bio-LNG represents about 90% of the total energy consumption of the LNG-fuelled fleet, although it acknowledged that there are competing users for the feedstock.

It said bio-LNG can cut greenhouse gas emissions by up to 80% compared with marine diesel on a full well-to-wake basis.

The report briefly touches on e-LNG or synthetic LNG, which like other e-fuels would use green renewable hydrogen as a feedstock. But it said current projects are largely pilots and any scale-up would not be until well into the 2030s, describing the scale of the e-fuel challenge generally as “breathtaking”.

The report says that all the alternative marine fuels being discussed today share the same pathway in that they need to move from their fossil form to bio-variations or versions combined with carbon capture and on to e-varieties produced with renewable hydrogen.


SEA-LNG revealed it is readying a new online calculator which will enable users to compare the cost of different marine fuels for use in complying with EU and IMO regulations.

The IMO is seeking net-zero emissions in the shipping sector by “close to 2050”.

SEA-LNG urges industry players to work together, share knowledge and avoid a “my fuel versus your fuel” mentality.

But the group goes on to state: “The LNG pathway currently has significant advantages over other alternative fuel pathways.”

What is FuelEU Maritime?

The EU's FuelEU Maritime regulation requires all ships operating in EU waters with a gross tonnage above 5,000 tonnes to cut greenhouse gas (GHG) emissions by 2% from the start of 2025.

This will rise to 6% from 2030, 14.5% from 2035, 31% from 2040, 62% from 2045, and finally 80% from 2050.

Vessels will be able to double-count their emissions savings when using green hydrogen or its derivatives (known in the EU as renewable fuels of non-biological origin, or RFNBOs) up to the end of 2033, in order to encourage their use.

A version of this article first appeared in Hydrogen Insight's sister publication TradeWinds.