to discuss BHP’s decision to trial a cargo ship propulsion system promoted by Finnish company Norsepower, which uses the wind to reduce fuel consumption and carbon emissions.
Now we’re looking for a solution that is available without constraint across the world, is very low cost and is environmentally friendly. Now, that intersection doesn’t exist. So weaning the industry away from fuel oil that is freely available at almost every large port in the world, has a cost base which is lower than any other fuel and is very energy intensive is going to be an extremely difficult task.
I often use the analogy of passenger cars; the non-ICE [internal combustion engine] technology has been around for a long time now. But what percentage of penetration do we have of EVs [electric vehicles] around the world? It’s still very small and we don’t have that kind of time, right? We need to do this much more quickly, and therefore you need impetus, you need a regulator to make that happen.In the case of global change, you need the IMO [International Maritime Organisation] to step up.
The number of shipping start-ups in Singapore is phenomenal, and the types of things that they’re thinking about right now, I’m really very, very impressed. BHP spends a lot of time with these start-ups to learn from each other, but also to help them. There’s a number in Singapore like Motion Ventures [a shipping industry venture capital fund backed by the Singapore government] and others that hopefully have taken advantage of that.
Do you think your big ships probably won’t work on electric or battery power, and for the foreseeable future sustainable fuels are more likely to be the solution? How did you first hear about Norsepower and its Rotor Sails technology for wind propulsion on big cargo ships?Rotor sail and wind technology has been with us for centuries, so it started off with sails and moved on into different innovative ideas. Rotors themselves as a technology are not new from an engineering perspective. But rotors on vessels are born out of the burning platform that we all have, which is decarbonisation.
We really wanted to understand the mechanics of how these rotors work, what the safety mechanism of this looks like, because that’s very important, what the economic outcome is, and then, of course, what the emissions reductions are. That’s taken us to a point where we then needed to partner with the right people around the world. As you know, we take an ecosystem approach to do that and that’s where Norsepower, PPC [Pan Pacific Copper] and BHP came together.
Spot on ... the capital return is quite quick and the upside for both the shipper and the charterer can happen within three to four years. It’s a solution that can be used across the lifecycle of the ship.So this is a product that will be used for 15 to 20 years and if you take an 8 per cent reduction in VLSFO [very low sulfur fuel oil], which as you know, oil prices cost approximately $800 a tonne and a vessel of this size can use 25 to 30 tonnes of fuel day.