LNG- TODAY, TOMORROW-

“La cantieristica navale italiana alla prova del GNL. Prospettive opportunità e

iniziative in corso”- Autorità Portuale di Genova

Palazzo San Giorgio -27 Ottobre 2014

Summary

2 © Wärtsilä

• WHY LNG

• STATUS QUO AND NOVELTIES

• THE EXPERIENCE IN THE MECHANICALDRIVES APPLICATIONS

• TOMORROW’S CHALLENGES

WHY LNG

Environment

LOCAL

GLOBAL

LOCAL

LOCAL

Acid rainsTier II (2011)Tier III (2016)NOx

Greenhouse effectEnergy Efficiency Design Index (EEDI)

CO2

Acid rainsSulphur content in fuel from 2015 worldwideSOx

Direct impact on humansLocally regulated

Particulatematter

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Fuel prices trends Marine Diesel Oil Rotterdam

Fuel price [USD/MMBTU]

180 Centistoke Rotterdam

?

380 Centistoke RotterdamHenry Hub (Natural Gas)

Marine Gas Oil Rotterdam

0,0

5,0

10,0

15,0

20,0

25,0

30,0

35,0

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Revised Marpol Annex VI Regulation 13

Tier I >130 kWNew ships 2000

Tier II >130 kWNew ships 2011

Tier III >130 kWUpcoming requirement,New ships inside Emission Control Areas (ECA)

Rated engine speed (rpm)

02468

1012141618

0 200 400 600 800 1000 1200 1400 1600 1800 2000

NOX (g/kWh)

Wärtsilä NORoperation area

Primary methods operation area

Secondary methods operation area

Wärtsilä standard NOR is dimensioned for reaching the IMO Tier 3 level.

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Marine sulphur limits

–97% –86%–71%–78%–67%

0.1

4.5

3.5

1.51.00.5

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

World

EU in ports

ECA

Sulphur limit (%)

California

Review of the 0.5% S global limit to be performed in 2018. In case readiness is not deemed to be sufficient by 2020, the introduction of the limit will be postponed to 2025.

2012

Fuel type Not regulated = both HFO and distillate are permitted. Exhaust gas cleaning Permitted alternative under Regulation 4 to achieve any regulated limit.

Particulate Matter (PM) No limit values.

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Emission Control Area (ECA) landscape

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How to comply with recently confirmed IMO Tier III?

NOX compliancy

CatalystCatalyst(Nitrogen Oxides Reducer) Natural GasNatural Gas

...or...

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SOX compliancy

ScrubberScrubberChange fuelChange fuel(low sulphur distillates)

...or...

Natural GasNatural Gas

...or...

How to comply with Sulphur limits?

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STATUS QUO AND NOVELTIES

Dual-fuel application references

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Merchant

Offshore

Cruise &Ferry

Navy

Others

Power Plants

DF Power Plant• 67 installations• 354 engines• Output 4600 MW • Online since1997

OSV’s• 31 vessels• 96 engines

Production• 2 platform• 9 FPSO’s etc.• 1 FSO• 40 engines

LNG Cruise ferry• 1 vessels• 4 engines • Complete gas

train

LNG ferries• 4 ferries• 18 enginesConversion• 1 ferry• 2 engines

Coastal Patrol• DF-propulsion• DF main and

auxiliary engines

TUG• 2 vessel• 2 engines

each • Mechanical

drive

Guide Ship• 1 vessel

/engineIWW• 2 vessel• 3 engines

6 segments >1,000 engines >10,000,000 running hours

LNG CarrierMultigas CarrierRo-RoBulk CarrierConversion

150 vessels5 vessels2 vessels1 vessels1 vessels

~ 650 engines

LNG as cargo

LNG is never stable in cargo tanksLNG is never stable in cargo tanksflexibility is the reason why DF-E has been successful

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LNG as marine fuel

LNG tanks(2 x 500 m3)

LNG is lighter than Diesel but requires more spaceLNG is lighter than Diesel but requires more spaceSystem integration and Ship Design are key factorsSystem integration and Ship Design are key factors

Dual Fuel engines(2 x W6L50DF)

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Wärtsilä 2-stroke DF – Deliveries

Engine type Expected drawing delivery of main components

Expected first engine delivery

RT-flex50DF Q2 2014* Q1 2015**W-X62DF Q4 2014* Q3 2015**W-X72DF Q2 2015* Q1 2016**W-X52DF Q3 2015* Q2 2016**W-X82DF Q4 2015* Q3 2016**

* Expected final drawing delivery is subject to order

** Expected engine delivery varies but is normally obtained 6 – 12 months after final drawing delivery

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Dual Fuel 2-stroke

High efficiency Low pressureMeets IMO Tier III without treatments

Design principles:

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2-stroke DF - Key Technologies

Micro pilot’ and Pre-chamber technology• Electronically controlled injectors +

Common Rail fuel supply• Pilot fuel (for ignition) only 1% -

minimizing fuel costs• Pre-chamber technology for best

combustion stability and reduced emissions

• Technology developed and proven on 4-stroke

• Option for HFO as pilot will be available

17 © Wärtsilä

Pre-chamber

2-stroke DF - Key Technologies

Engine control and automation system • Wärtsilä ‘UNIC’ based control

system• All essential controls in one

system• Individual control of combustion

related parameters – optimized engine performance

• Inbuilt Redundancy for ’single main engine’ application

• Safety functions related to gas operation including knock- and misfire detection

Pilot fuel injector

Gas admission valves

Control system

2x Gas admission valves

Pilot fuel injectors

Engine speed/CA-signalEngine stop signal

Gas duration

Gas pressure

Pilot fuel pressure

Exhaust valve drive

Exhaust valve

Wärtsilä 2-STROKE / Ingemar Nylund18 © Wärtsilä 08 January 2014

Ship type: 2+2 x 15’000 dwt Chemical tankers Owner: Terntänk of SwedenShipyard: AVIC-Dingheng in ChinaVessel delivery date: early 2016Engine type: Wärtsilä 5RT-flex50DF

INTO the FUTURE --Baltic SO2lution

Leading into the Gas age – references!

19 © Wärtsilä

Leading into the Gas age – references!

• Ship Type: 14’000 m3 LNG Carrier

• Owner: Zhejiang Huaxiang Shipping Co., Ltd– Private shipping company– Major player in LPG transportation market– One of the owners who acquired the route rights

of LNG transportation in China domestic water

• Shipyard: Qidong Fengshun Ship Heavy Industry Co., Ltd,

• Delivery date: Sept. 2015

• Engine type: Wärtsilä 5RT-flex50DF

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4-stroke DF Portfolio & Applications

0 5 10 15

50DF

20DF

0.5 -1.8 MW

2,8 – 8,0 MW

5.8- 17.5 MW

20

34DF

• LNG Carriers• Cruise ships• RO-RO/PAX• Ferries• Large Offshore Units

• Small LNG / CNG vessel• Small cargo vessels• Supply vessel• Offshore application &

Production• Aux. engines with

W46/50DF

• LNG Feeder• Jack-up• Tugs• Small cargo vessels• Barges• Small ferries• Aux. engines with

W34DF & W50DF

> 600 engines 50DF

> 50 engines 20DF

> 100 engines 34DF> 750 Engines sold for Marine use

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4-stroke DF Portfolio & Application types

0 5 10 15

50DF

20DF

46DF

0.5 -1.8 MW

3,0 – 10,0 MW

6.2 -18.3 MW

5.8- 17.5 MW

20

34DF

• LNG Carriers• Cruise ships• RO-RO/PAX• Ferries• Large Offshore Units

• Small LNG / CNG vessel• Small cargo vessels• Supply vessel• Offshore application &

Production• Aux. engines with W50DF

• LNG Feeder• Jack-up• Tugs• Small cargo vessels• Barges• Small ferries• Aux. engines with

W34DF & W50DF

• LNG Carriers• Cruise ships• RO-RO/PAX• Ferries• Large Offshore Units

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Dual Fuel 4-stroke

High efficiency Low pressureMeets IMO Tier III without treatments

Design principles:

23 © Wärtsilä

EXPERIENCES IN THE MECHANICAL DRIVE

APPLICATIONS

Experience And Development

Wärtsilä DF proven solution :

• Load taking capability

• Intrinsic redundancy – no interruption of operations

• Safety and fuel flexibility

• Application experience with mechanical drive,

single main engine

25 © Wärtsilä

Safety and flexibility

% L

oad

100 %

0

Diesel mode Gas mode

Gas

mod

e op

erat

ion

from

0 –

100%

MC

R

110 %Dual Fuel engine can transfer instantly to

diesel mode at any load

Full flexibilityCan start/stop/idle in gas modeCan operate on all loads in gas modeCan operate on one lube oil for all fuels Can operate on cheapest fuel available

Full redundancy no need for additional equipment

if failure: Instant safety backup maintaining full power and speed

Automatic safety trip

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DF Loading test 0–100%, Gas Operation

Eng

ine

load

Eng

ine

spee

d

Engine load [%]Engine speed [rpm]Gas inject. Duration [time]

*Frequency variation ~2%

*Class requirement max 10% deviation

Loading ramp is done in test conditions, demonstrative and valid for laboratory only

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DF Loading test 0–100% Gas + Diesel Operation

Eng

ine

load

Eng

ine

spee

d

Engine load [%]Engine speed [rpm]Gas inject. Duration [time]

DF redundancy proves even in full power ramp-up an sudden failurein the gas system does not compromise safety

Simulated gas system

failure

Simulated gas system

failure

Loading ramp is done in test conditions, demonstrative and valid for laboratory only

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Dredgers: Wärtsilä DF latest development

0

20

40

60

80

100

120

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98100102104106108110112114116118120122124126128130132134136138140142144146148150152154156158160162164166168170172174176178180182184

Pow

er [%

]

Time [min]

Load step test for Duel Fuel 34 engine

W6L34DF load step variation succesfull testspecific for dredger application, held on August 2013

34DF

Loading program done in test conditions, demonstrative and valid for laboratory only

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LPG Carrier: Evergas – Mechanical drive

Main engines

Main engines

Auxilliaryengines

Auxilliaryengines

PropulsionPropulsion

GearGear TankDesignTank

Design

FuelSupply

FuelSupply

CargoHandling

CargoHandling

Relique-faction

Relique-faction

30 © Wärtsilä

LPG Carrier: Evergas – Mechanical drive

New YorkNew YorkTwin engine

6L50DFTwin engine

6L50DF

Twin in –Single out

TCH350

Twin in –Single out

TCH350

Twin in –Single out

TCH350

Twin in –Single out

TCH350Shaft generator

1’600kWShaft generator

1’600kW

ShaftShaft

CPP

4E1540CPP

4E1540

31 © Wärtsilä

LPG Carrier: 4700 m3 – Anthony Veder

Main engine

W6L34DFMain engine

W6L34DFGear

VerticalGear

Vertical

Shaftgenerator

PTO

Shaftgenerator

PTO

ShaftShaftCPPCPP

32 © Wärtsilä

LNGC : 15600 m3 Coral energy

Main engine

W8L50DFMain engine

W8L50DFGear

VerticalGear

Vertical

Shaftgenerator

PTO

Shaftgenerator

PTOShaftShaft

CPPCPP

33 © Wärtsilä

Tug boat : 80ton Bollard pull - CNOOC

Main engines

W6L34DFMain engines

W6L34DF

34 © Wärtsilä

IWW – LPG Carrier : Chemgas BV

Owner : Chemgas Shipping BVDelivery : Q4 – 2013Amount of vessels: 2

“First W20DF + FPP application”

Wärtsilä scope of supply:

• 1*W8L20DF (main engine)

• FPP with nozzle

GE

AR W8L20DF

35 © Wärtsilä

Chemical Tanker: Bit viking - DF conversion

Main engine

W6L50DFMain engine

W6L50DFGear

VerticalGear

Vertical

Shaftgenerator

PTO

Shaftgenerator

PTOShaftShaft

CPPCPP

36 © Wärtsilä

DF for mechanical drive

• Bit Viking - The First vessel– The First gas conversion– The First Diesel Mechanical gas engine– First Dual-Fuel “single main engine” approval– The First Wärtsilä gas handling system– The First non LNGC gas powered merchant vessel

.... and a happy owner

37 © Wärtsilä

Before After

Background - Main engines conversion

before2 x W6L46B

5850 kW each

WÄRTSILÄ 8L20 1200 kW

CPP

CPP

PTO 1500 kW

PTO 1500 kW

WÄRTSILÄ 8L20 1200 kW

after2 x W6L50DF 5700 kW each

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DF mechanical propulsion - Operational experience

39 © Wärtsilä

Date 1.12.2011Time 22:15Vessel speed 14,3 knotsLatitude N 57°58‘Longitude E 6°4'Heading 100°Wind speed 10,5 m/sWind direction 290°Wave height (avg.) 4-5 mDraught 8 m

NORWAY

Waves direction290°

DF mechanical propulsion - Operational experience

0

100

200

300

400

500

600

700

800

900

1000

30

40

50

60

70

80

90

100En

gine

load

[%

]

Engine load

Engine speed

Engi

ne sp

eed

[rpm

]

500 100 150 200Time [s]

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0

100

200

300

400

500

600

700

800

900

1000

30

40

50

60

70

80

90

100En

gine

load

[%

]

Engine load

Engine speed

Engi

ne sp

eed

[rpm

]

500 100 150 200Time [s]

DF mechanical propulsion - Operational experience

83%83%85%85%

37%37%

514rpm514rpm

486rpm486rpm

8 s8 s

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0

1000

2000

3000

4000

5000

24.10.2011 7.1.2012 22.3.2012 5.6.2012 19.8.2012 2.11.2012Ope

ratin

g ho

urs

Operating hours 24.10.2011 – 5.11.2012

Gas

Diesel

• Carbon contents in fuel estimated as follow:– HFO: 85%-w, LNG: 75%

• Bit Viking saving in annual CO2 production– 4500 ton CO2

42 © Wärtsilä

TOMORROW’S CHALLENGE

Esplorazione &Sviluppo Campo

ProduzioneFPSO

LNG carrierTerminale di liquefazione LNG

Terminale LNG& Rigassificazione(FSRU/JRU)

Distribuzione & TrasportoGenerazione Energia

LPG/LNG tanker

LNG fuelledvessels

Small-scaleLNG plants

LNG fuelledvessels

LngLng: THE LOGISTIC CHAIN AND Wärtsilä: THE LOGISTIC CHAIN AND Wärtsilä CONTRIBUTIONCONTRIBUTION

Esplorazione & Sviluppo Campo

Produzione & Liquefazione

Trasporto & Stoccaggio

Terminali diRicezione &

Rigassificazione

Distribuzione & Trasporto

• Analisi Campo e successiva Trivellazione

• Sistemi di propulsione a Gas

• Sistemi di Trasporto LPG, LEG & LNG

• Piccole stazioni di Liquefazione a Terra e in Mare

• Gas FPSO

• Gestione carichi LNG• Rigassificazione Jetty & Floating

• Terminali di Ricezione

• Distribuzione e Logistica di Gas/LNG

• Impianto di Generazione Energia

44

Barges & StazioniRifornimento LNG

Wärtsilä Wärtsilä FROM DRILLING...FROM DRILLING...

Esplorazione & Sviluppo Campo

Produzione & Liquefazione

Trasporto & Stoccaggio

• Sistemi di propulsione a LNG per OSVs

• Sistemi di propulsione a Gas• Sistemi di Trasporto LPG, LEG & LNG

• Piccole stazioni di Liquefazione a Terra e in Mare antiflaring/VOC

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...TO THE END USERS...TO THE END USERS

LNG come combustibile per trasporto: Supply Chain in una Produzione di LNG di piccola scala

Trasporto RigassificazioneLNG

Stoccaggio e Rifornimento Distribuzione Utenze

LNG Trailer Truck

LNG Fuelled TruckStazioni di Rifornimento

Small LNG Carrier

Liquefazione

LNG Bunker Vessel LNG Fuelled Vessel

Terminale Rigassificazione

Terminali

LNG Carrier

Generazione Energia

ConvenzionaleDomanda di Gas crescerà a ~2% CAGR nel 2035

Marittimo: Terminale a distribuzione10% del totale consumo di LNG(crescita prevista fino al 14% nel 2025)

StradaTerminale a Truck

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Thank you for your attention

47 © Wärtsilä