What does LNG mean? What about LBG?

Gas-related abbreviations can be a bit confusing. Here’s our quick guide to Gasum gas products for maritime transport.

LNG = liquefied natural gas

LBG = liquefied biogas

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Jacob Granqvist

Sales Director, Maritime
tel. +358 40 483 9129
jacob.granqvist@gasum.com

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The cleanest marine fuel available

If we are to fight climate change, emissions from the use of conventional fuels such as heavy fuel oil in maritime transport need to be reduced. Rapidly becoming more common as a cost-effective alternative, liquefied natural gas (LNG) is the cleanest marine fuel available. Compared with heavy fuel oil, LNG has significantly lower CO2 emissions, and almost nonexistent particle emissions.

LNG is a safe and proven technology that offers higher energy content and lower operational and maintenance costs. It is suitable for all vessel types, including ferries, passenger ships, tankers, bulk carriers, supply and containerships.

As a premium provider of LNG, Gasum is a trustworthy partner for both experienced buyers and for customers that are switching from conventional fuels to LNG. Our wide variety of sustainable yet efficient services and solutions support our customers in optimising their operations for a more sustainable future.

Decarbonization of the maritime industry 

Maritime traffic generates 3 percent of the world’s total greenhouse gas emissions such as carbon dioxide. This contributes to global warming and extreme weather conditions. CO2 is emitted by ships using petroleum-based fuels to power main and auxiliary engines. Through the International Maritime Organization (IMO) the world’s shipping industry is constantly working to reduce CO2 emissions. 

LNG as a marine fuel meets all the current and forthcoming IMO and EU regulations. Switching to LNG means complete removal of Sox and particles, and reduction of Nox emissions of up to 85 percent. LNG reduces CO2 emissions by at least 20 percent.

As a fuel, LNG is interchangeable with renewable LBG (liquefied biogas), as they both consist mainly of methane. This means that the two gases can be mixed. Using both LNG and LBG is one of the concrete actions that will take us towards a low-carbon society of the future.

Contact our sales team to discuss more about gas as a solution for cleaner maritime transport.

Towards cleaner maritime transport

Stay up-to-date about maritime market

We publish maritime market updates on our website every week. Updates cover topics from prices to current trends affecting maritime market. See the latest market updates below. 

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Maritime market updates

21.09.2021

Maritime market update: gas prices surge on tight supply outlook

Risavika LNG index gains continued last week, it was up 9.6 % reaching 75.11 EUR/MWh for October contracts as European gas market prices were on rise on the back of possible Nord Stream 2 delay. Meantime, Gazprom has not booked additional supply capacity through Ukraine in October, leaving gas supply situation unchanged for the next month when the market steps into a new gas year. With no additional gas supplies to the market, the prices could be seen even higher to compete with Asian gas prices in order to attract LNG cargoes to Europe. The extend of the increase would depend on the weather and demand for heating.

Benchmark oil prices remain supported by the consequences of hurricanes in the Gulf of Mexico. Oil product prices have gained on potential delays with resuming some of refining and production capacities, however, the gain was limited.  Fuel oil 3.5 (FO 3.5) price has gained 0.8 % to 396.14 USD/t, low sulphur oil (MFO 0.5) increased by 2.6 % to 518.90 USD/t and marine gasoil (MGO 0.1) increased by 3.5 % to 616.33 USD/t.

 

 

Front Month Price index

LNG Risavika*

LBG blend

Risavika**

FO 3.5 FOB Rdam

MFO 0.5 FOB Rdam

MGO 0.1 FOB ARA

ULSD FOB ARA

Unit

75.11

78.11

28.40

35.63

42.32

45.21

EUR/MWh

1272.32

1323.15

396.14

518.90

616.33

630.58

USD/t

imagew51c.png

 

LNG Risavika - LNG FOB Risavika 

LBG Risavika 10 % - 10 % blend of Liquified Biogas

FO 3.5 FOB Rdam – European 3.5% Fuel Oil Barges FOB Rdam (Platts) Futures Quotes

MFO 0.5 FOB Rdam - European FOB Rdam Marine Fuel 0.5% Barges (Platts) Futures Quotes

MGO 0.1 FOB ARA - Gasoil 0.1% Barges FOB ARA (Platts) Futures Quotes

ULSD FOB ARA - European Diesel 10 ppm Barges FOB ARA (Platts) Futures Quotes

 

Source: CME Group, Gasum, Argus Media

*An estimate for LNG FOB Risavika 

** An estimate for 10 % LBG blend FOB Risavika

Read more
15.09.2021

Maritime market update: LNG leads alternative fuel uptake for new ships on order

Risavika LNG index was up 12 % in two weeks, reaching 67.92 EUR/MWh for October contracts. The sentiment in the market is bullish on likely delay of Nord Stream 2 (NS2) supplies despite its completion. German energy regulator Bnetza has until early January to reach and publish a draft decision on the 55 bcm NS2 developer's application to act as the line's operator, with a final decision not likely until summer 2022. Accompanied with current low pipeline supplies from Norway and Russia, low LNG arrivals and low storage stocks across the Northwest Europe, the prices could gain more depending on the heating demand next month.

Oil product prices were mostly sideways for the last two weeks supported by hurricane season in the US.  Fuel oil 3.5 (FO 3.5) price has dropped 0.3 % to 393.12 USD/t, low sulphur oil (MFO 0.5) gained 0.5 % to 505.18 USD/t and marine gasoil (MGO 0.1) increased by 0.6 % to 594.67 USD/t. Oil products prices could gain in short-term as hurricane Nicholas was heading towards oil facilities in Texas, which could impact production of crude and refineries run.

Despite this year spike in prices, shipowners are considering long-term perspective. According to DNV’s recent Maritime Forecast to 2050, the energy and technology transition in shipping has started with nearly an eighth (12%) of current newbuilds ordered with alternative fuel systems. This was an increase from the 6% reported in the 2019 edition. Except for the electrification underway in the ferry segment, the alternative fuels are currently dominated by LNG. The trend is likely to continue until e until regulations tightens in 2030 or 2040 depending on the decarbonization pathway. DNV’s model shows uptake of carbon-neutral fuel picking up in the late 2030s or mid-2040s, reaching between 60% and 100% of the fuel mix in 2050.

 

Front Month Price index

LNG Risavika*

LBG blend

Risavika**

FO 3.5 FOB Rdam

MFO 0.5 FOB Rdam

MGO 0.1 FOB ARA

ULSD FOB ARA

Unit

67.92

70.92

28.19

34.68

40.83

43.67

EUR/MWh

1150.52

1201.34

393.12

505.18

594.67

609.17

USD/t

 

imageikva.png

LNG Risavika - LNG FOB Risavika 

LBG Risavika 10 % - 10 % blend of Liquified Biogas

FO 3.5 FOB Rdam – European 3.5% Fuel Oil Barges FOB Rdam (Platts) Futures Quotes

MFO 0.5 FOB Rdam - European FOB Rdam Marine Fuel 0.5% Barges (Platts) Futures Quotes

MGO 0.1 FOB ARA - Gasoil 0.1% Barges FOB ARA (Platts) Futures Quotes

ULSD FOB ARA - European Diesel 10 ppm Barges FOB ARA (Platts) Futures Quotes

 

Source: CME Group, Gasum, Argus Media, DNV

*An estimate for LNG FOB Risavika 

** An estimate for 10 % LBG blend FOB Risavika

Read more
31.08.2021

Maritime market update: energy commodities on rise for September

European gas markets experienced another bullish week with Risavika LNG index reaching 59.19 EUR/MWh for September, gaining 12 % week on week. The energy sector prices in Europe have been rallying, the markets have seen power spot prices in Germany above 100 EUR/MWh and carbon prices maintained their upward trend. All this supported gas prices for the next month contracts. However, the most significant factor for an observed increase was due to a jump in Asian spot LNG prices, which could translate into lower LNG deliveries to Europe, the market with already tightened supply. The price curve shows the highest levels for Q4 21 followed by sharp drop towards Q2 22.

Benchmark crudes and oil products prices were supported by closures of production and refinery sites in the regions impacted by the hurricane Ida. However, this increase could be short-lived and currently companies are assessing the damage to restart their production. Fuel oil 3.5 (FO 3.5) price increased 12 % to 394.31 USD/t, low sulphur oil (MFO 0.5) and marine gasoil (MGO 0.1) were up by 10.2 % and 9.4 % to 502.61 USD/t and 591.03 USD/t respectively week on week. The attention of the market is on 1st of September OPEC+ meeting, which will define the course of oil supply in the medium term. However, no surprises are expected for the output for September.

 

Front Month Price index

LNG Risavika*

LBG blend

Risavika**

FO 3.5 FOB Rdam

MFO 0.5 FOB Rdam

MGO 0.1 FOB ARA

ULSD FOB ARA

Unit

59.19

62.19

28.27

34.51

40.58

42.91

EUR/MWh

1002.71

1053.54

394.31

502.61

591.03

598.50

USD/t

imagevuynn.png

 

LNG Risavika - LNG FOB Risavika 

LBG Risavika 10 % - 10 % blend of Liquified Biogas

FO 3.5 FOB Rdam – European 3.5% Fuel Oil Barges FOB Rdam (Platts) Futures Quotes

MFO 0.5 FOB Rdam - European FOB Rdam Marine Fuel 0.5% Barges (Platts) Futures Quotes

MGO 0.1 FOB ARA - Gasoil 0.1% Barges FOB ARA (Platts) Futures Quotes

ULSD FOB ARA - European Diesel 10 ppm Barges FOB ARA (Platts) Futures Quotes

 

Source: CME Group, Gasum, Reuters

*An estimate for LNG FOB Risavika 

** An estimate for 10 % LBG blend FOB Risavika

Read more