Overcoming Financial Hurdles of Green Ammonia Refurbishment

Norwegian [Europe]: A new study conducted by industry experts and led by Norwegian shipowner Grieg Star has found that retrofitting ships for green Ammonia-powered propulsion is currently not financially feasible. Despite this, the group of experts concluded that deepsea shipping can transforming to run on green Ammonia is still a feasible option, provided certain difficult hurdles were overcome. The study was conducted over a two-year period through 2022 and focused on retrofitting an open hatch vessel to use green Ammonia as fuel.

Many reports have found that the main barriers facing green Ammonia today are exorbitant retrofit costs, a lack of affordable green Ammonia options, and a lack of clarity regarding regulatory frameworks.

“Without the stability of green Ammonia availability/ pricing for the maritime sector (potentially green corridors) and, even more importantly, stable framework conditions, financing such a venture is not viable, even with significant soft project funding,” the report stated.

Yesterday, the Norwegian Green Shipping Programme released a report on a study they had initiated and facilitated.

Grieg Star’s managing director Atle Sommer has made a promise to share their findings, and no corners are being cut. They are not withholding anything that could be valuable for other companies. There is an industry-wide transformation taking place right now, and knowledge-sharing and transparency have become even more important. By making their report accessible to the public, they hope it can benefit others as well.

The Norwegian maritime industry is paving the way for a green shift into deepsea shipping and Ammonia as fuel. As Ammonia is seen as the preferred alternative for deepsea shipping to meet the International Maritime Organization's ambition and the Paris Agreement's targets, Narve Mjos, director of the Green Shipping Programme, has stated that Norway will be ready for this transition. In addition to being a front runner when it comes to battery-powered ships for coastal shipping, Norway will now also be ready for this green shift into deepsea shipping and Ammonia as fuel.

A total of 21 organizations were involved in the research study, which was divided into five workstreams. Yara, the Norwegian Maritime Authority, G2 Ocean and Grieg Maritime Group took on lead roles for the different workstreams.