Noboru Ueda C hairman & President, ClassNK

Noboru UedaChairman & President, ClassNK

The Economics of Eco-Ships

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BDI: 650~Roughly the same as 2009

The PeakBDI: 11,000

The CrashBDI: 650~

Today:

Baltic Dry Index (BDI) Source: Bloomberg

The First Factor – Charter Rates

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The Crash (2009)Capesize $57mPanamax $35mHandymax $31mHandysize $25m

The Peak (2008)Capesize $104mPanamax $58.5mHandymax $50mHandysize $40m

Capesize Panamax Handymax Handysize Source: Drewry

The Second Factor – Ship Prices

$45m$27m$25m$19m

TodayNB Price: 20% below 2009 prices

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The PeakBunkers: $750/t

The CrashBunkers: $250/t

380cst Bunker (Singapore)Source: Bloomberg

Today Bunkers: $680/tMore than 2.5x2009 prices

Baltic Dry Index (BDI)

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The Third Factor – Bunker Fuel Prices

Source: SSY

Today: Bunker Price almost 7 times higher than 1999!

Singapore 380 CST

1999: Bunkers Less than $100/t

Bunker Prices:

Long term trend

of higher prices

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The Third Factor – Bunker Fuel Prices

Why Fuel Costs Matter Now

Newbuilding Price: $27 mil Fuel: 35 t/day 　Voyages: 250 days

Lifetime Fuel Cost

$21.8 MillionLifetime Fuel Cost

Only 80% of Ship Price

Test Case: Panamax BC Year: 1999

35t/day x $100/t x 250 days=$875,000/year x 25 years

Mil. US$Ship price Fuel price

Source: DrewryS-6

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50

100

150

200

5 10 15 20 25Years after Delivery

Why Fuel Costs Matter Now

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50

100

150

200

5 10 15 20 25Years after Delivery

Newbuilding Price: $27 mil Fuel: 35 t/day 　Voyages: 250 days

Lifetime Fuel Cost

$153 MillionLifetime Fuel Cost

550%of Ship Price

35t/day x $700/t x 250 days=$6.1 Mil/year x 25 years

Mil. US$

Test Case: Panamax BC Year: 2012

Ship price Fuel price

Source: DrewryS-7

The Value of Eco-ShipsStandard Panamax BC and 20% More Fuel Efficient Eco-Ship

Source: Drewry

Mil. US$

Years after Delivery

With Bunkers @ $700 tons a day a 20% decrease

in fuel consumption= $1.2 million savings each year

Lifetime Savings of

$30.6 Million over 25 years

(per ship)

28 tons / day 35 tons / day

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30% GHG reduction via integrating 30% GHG reduction via integrating the following technologies:the following technologies:

Whale back bowWhale back bow Electronically controlled diesel engineElectronically controlled diesel engine Variable nozzle area turbocharger Variable nozzle area turbocharger Waste heat recovery systemWaste heat recovery system Single-screw, twin-engine Single-screw, twin-engine

propulsion systempropulsion system Contra-rotating propellersContra-rotating propellers

eFuture 310T Tanker & 56B Bulk CarrierIHI Marine United (IHIMU)

IHIMU estimates that the initial cost of these new systems will be recouped within 5 or 6 years.

Eco-Ships have already arrived

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Next-generation “G-Series” Capesize & Panamax BC

• LEADGE-Bow • Super Stream Duct (SSD)• SURF-BULB

• Delivery from end of 2013

Universal Shipbuilding Corp. (USC)

20% Fuel savings fromnew technology:

G209BC (209,000 DWT) G80BC (80,000 DWT)

Eco-Ships have already arrived

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Mitsui Engineering & Shipbuilding

Neo Supramax 66BC• 66,000 DWT• Length: abt. 200 m • Beam: 36.0 m• Depth: 18.45 m• Draft: 15.2 m• Fuel savings: 30%Fuel savings: 30%• Launched onto marketLaunched onto market

Fuel Savings30%

Conventional 56BC35 tons/day

Neo Supramax 66BC25 tons/day

MES estimates that the initial cost of these new systems will be recouped within a few years.

Eco-Ships have already arrived

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Imabari Shipbuilding Panamax BC (84,000 DWT)Fuel consumption: under 30 tons/day

Oshima Shipbuilding Panamax BC (77,000 & 82,000 DWT)Fuel consumption: under 30 tons/day

Sanoyasu Hishino Meisho

Panamax BC (82,000 DWT)Fuel consumption: under 30 tons/day“Handy Cape” (120,000 DWT)Fuel consumption: 13% saving

Namura Shipbuilding High Bulk 34 BC (34,000 dwt)Fuel Consumption:10% less than 32BC

Capesize BC (170-180,000 DWT) To market in near future.

Eco-Ships have already arrived

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Improvement of Optimum Hull Form (New bow, hull shape) Reduction of Hull Friction (Coatings, Air lubrication) Improvement of Propeller Efficiency (CRP, ducts) Improvement of Engine Efficiency (Turbochargers, engines Utilization of Renewable Energy (Solar, hybrid systems)

How do we improve efficiency?

We have to look at the entire ship but this requires cooperation across many sectors….

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Industry Wide Initiatives

ShipbuildersMHI, IHI, Oshima…

MakersYanmar, Nippon Paint...

Shipping Co.NYK, MOL, K-Line...

NPO/GovClassNK, MTI, MLIT…

712

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R&D Projects22

30%GHG EmissionReduction vs.Existing Ships

All-Japan GHG Emission Program

Our Contribution: USD 28 Million to 19 of 22 projects

2009-2013

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Combined generator + Turbocharger. Already in use on bulk carrier Shin Koho

CO2 Reduction: 2% Output Terminal Box

High Speed PM Generator

FlexibleCoupling

Hybrid Turbocharger

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Hybrid Power Systems

Auriga LeaderVehicle Carrier

Hybrid solar panel and battery/fuel cell system used to reduce electric power needs during voyage – reducing fuel use.

CO2 Reduction: 2%

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Hybrid Power Systems

Emerald AceVehicle Carrier

Hybrid solar panel and battery/fuel cell system used to eliminate the need for generators/fuel use in berth at port

CO2 Reduction: No emissions in portDelivered: June 2012!

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Air lubrication System Bubbles generated by blower reduce the

frictional resistance between the vessel’s bottom and water.CO2 Reduction : 12-13% at sea trials on Module Carrier

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Air Lubrication

The Solution: A united effort by 10+ Shipyards and research organizations

Revolutionary Technology but with many challenges…

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Many Challenges:•Development and optimization of blower system and controls.

•Testing shape of openings, size of bubbles and effect on hull.

•Study flow of bubbles along hull in order to improve efficiency.

•Develop design tools for application to other ship types.

•Ensure performance (propeller, sea chest, etc) not affected by new system.

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First test application of new MALS Air Lubrication technology on a traditional deep draft cargo vessel, built at Oshima Shipbuilding in Japan for NYK. CO2 Reduction : 4-8% during sea trials depending on draft level

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Results of Collaboration:

Soyo Type: Coal Carrier (BC)Size: 91k DWTLength: 235mBeam: 43mDraft: 13m

Results of Collaboration:

Size: 95k dwt BCLength: 237mBeam: 40mDraft: 12.5m (Designed Load)

MALS-ADMMAX

Jointly developed by rival shipbuildersMitsubishi Heavy Industries (MHI) & Oshima Shipbuilding for sale to U.S. based grain/dry bulk major ADM.

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MALS-14000CS• Capacity: 14,000 TEU• Length: 366 m • Beam: 48.8 m• Draft: 15.2 m• MHI Air Lubrication System (MALS)MHI Air Lubrication System (MALS)• Fuel savings : 35%Fuel savings : 35%

The Next Steps

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Is this Green Revolution Real?

+70%

+15%

MPG

Year

Source: US EPA

Yesterday, Today & Tomorrow

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Thank you very much 　谢谢！