Swedish shipowner Furetank said it has signed a deal to secure bio-LNG for its product and chemical tankers as it looks to further slash emissions.
In that regard, Furetank has signed a letter of intent with Eskilstuna Biogas, enabling the development of a new biogas plant producing around 5,000 tonnes of LBG or bio-LNG annually, the shipper said in a statement on Thursday.
Furetank said it would buy at least 75 percent of the produced fuel for ten years.
The plant would get gas extracted from manure and food waste from the municipalities of Eskilstuna and Strangnas, it said.
Furetank said last year it was in talks to secure biogas for its fleet of LNG-powered tankers.
Last month, the firm ordered another LNG-powered tanker at China Merchants Jinling Shipyard in Yangzhou.
Following delivery in January 2024, the 17,999-dwt dual-fuel tanker would become the ninth in the Vinga series.
Furetank owns four and commercially operates all of eight FKAB-designed ice-class tankers under Sweden’s Gothia Tanker Alliance.
“It feels fantastic to access liquefied biogas in Sweden. With LBG produced in the right way, we can run our vessels completely without emitting CO2 or harmful particles,” Furetank’s CEO Lars Hoglund, said.
“This is a strategic move. We developed the new efficient vessels, chose gas as a fuel and offset remaining emissions. Now we move on to securing our own supply of LBG,” he said.
Swedish Environmental Protection Agency will provide 140 million Swedish crowns ($15.2 million) for the biogas project.
Furetank said that an agreement with a large customer was a requirement for obtaining financing.
“Before giving the new plant the final go, the production support for biogas recently decided by the Swedish government needs to come into force and all permits need to be in place,” the firm said.
Furetank added that production could start in the last quarter of 2023.