The Powerzeek Platform opened for business this week to enable digital LNG bunker transactions, and, as founder Dag Lilletvedt tells Bunkerspot, this online marketplace will also be available for other cleaner fuels in the future, such as biogas, hydrogen and ammonia.
Norway-based Lilletvedt is a well-known name in the LNG sector and has been involved in the industry for around 15 years, both as a buyer and seller. Along the way, he established Liquiline LNG and CRYO Shipping and in 2009 he set up Fuelgarden Energy, which focuses on LNG design and project management.
Coincidentally, one of Fuelgarden’s ongoing projects, the construction of an LNG terminal for Mowi on the Isle of Skye in Scotland, is now nearing the commissioning stage. Fuelgarden had earlier designed a mobile LNG installation to support the Kyleakin fish feed factory, and the new LNG terminal will supply LNG bunkers for fish feed carriers as well as regasifed LNG as gas supply for the factory.
Turning to Powerzeek, which went live on 20 April, Lilletvedt explains that the idea of developing a platform and online marketplace for the buying and selling of clean marine fuels started to take shape a few years ago.
‘I have been an LNG broker since 2005, and for a number of years I have been thinking about how to digitalise the process because it is a very manual type of work and so for the past two years we have been working on the technology to get the platform up and running.
‘I also think that both sides of the marketplace – the LNG suppliers and buyers – have been frustrated because transactions can often take a long time.’
One commonly expressed frustration over the development of the LNG bunker sector is the length of time it has taken to develop both a global supply infrastructure and a spot market.
As Lilletvedt explains, ‘Many of the ships out there that can run on LNG also run on diesel – they are dual fuel – and part of the reason that there is not more LNG being used is because shipowners do not necessarily know where they can get LNG, who can supply it and what the price will be.’
He believes that the marketplace services provided by the Powerzeek platform will help to break down barriers to the uptake of LNG bunkers, not least in terms of making it easier to find counterparties and to deliver transparency on LNG pricing. To date, the majority of LNG bunkers are bought on contract with little wider market disclosure on price, but for the LNG market to become more liquid a healthy spot market needs to develop, and Lilletvedt thinks the new platform can facilitate this.
‘LNG is also a different kind of fuel to what shipowners have been used to – it is priced differently – and so hopefully Powerzeek will make things easier,’ he says.
Buyers and sellers can register for free on the platform and enquiries sent out will be evaluated based on information provided by potential suppliers, including total offered price and – importantly – the price per energy unit. There can be regional variations in the energy content of LNG and what the price index or pricing model may be.
The platform allows direct engagement and communication between buyers and sellers, and ‘when suppliers and buyers “meet” they will have agreed on both technical and commercial factors that will go into their agreement,’ says Lilletvedt.
Giving buyers and sellers a comprehensive and easy-to-access picture of who and where their potential counterparties may be is a key USP of the Powerzeek platform, he notes.
‘My experience is that while many of the biggest players – the wholesale players – are very keen to get the LNG out to the small-scale and bunker markets, they don’t have the organisation that enables them to do it.
‘So I think this service will help them – it will be easier for them to meet the buyers, in addition to the distribution companies and the smaller players.’
While Lilletvedt may be based in northwest Europe, which is one of the most established and mature LNG bunker markets, he believes Powerzeek will have a global reach.
‘We are present in the US and have interested parties there; I have also been in Asia several times in the last few years and I see interest down there as well.’
In January this year, class society DNV GL announced that, in partnership with Teqplay, it had developed a common industry platform, called FuelBoss, for LNG bunker suppliers and shipowners. This particular platform is intended to connect industry stakeholders in the planning and execution of LNG bunkering operations.At the time of the announcement, Gasum, one of the pilot users of the system, said the emergence of such digital platforms will bring ‘disruption into the shipping industry’.
With his strong record of innovation in the LNG and shipping sector, Dag Lilletvedt certainly believes that the Powerzeek Platform can be part of this digital transformation. It can also be a catalyst to accelerate growth in the LNG bunker sector right now, and – further down the road – in the uptake of fuels such as liquefied biogas, bio-LNG and compressed biogas.