New offtake deal propels Maersk to meet over half of its 2027 methanol demand

Maersk has signed a long-term bio-methanol offtake agreement with LONGi Green Energy Technology Co as the company works to secure fuel for its growing fleet of dual-fuel methanol container vessels. According to Maersk, with the addition of the LONGi volumes, the container shipping major’s combined methanol offtake agreements now meet more than 50% of the dual-fuel methanol fleet demand in 2027.

“Bio- and e-methanol continues to be the most promising alternative shipping fuels to scale up in this decade, and the agreement with LONGi serves as a testament to this. Global shipping’s main net-zero challenge is the price gap between fossil fuels and the alternatives with lower greenhouse gas emissions. We continue to strongly urge the International Maritime Organisation’s member states to level the playing field by adopting a global green fuel standard and an ambitious pricing mechanism which the industry urgently needs,” says Rabab Raafat Boulos, Chief Operating Officer, A.P. Moller – Maersk.

“While we believe that the future of global logistics will see several pathways to net-zero, this agreement underscores the continued momentum for methanol projects that are pursued by ambitious developers across markets. China continues to play a pioneering role, and it is encouraging to also see strong market developments in other geographies as well. One example is the US where we are engaging closely with several promising projects,” says Emma Mazhari, Head of Energy Markets at A.P. Moller – Maersk.

Under the terms of the agreement, LONGi will deliver bio-methanol produced at a facility in Xu Chang, Central China. The bio-methanol is produced from residues (straw and fruit tree cuttings), and the first volumes are expected in 2026 with full production expected at the end of the decade. It will meet Maersk’s methanol sustainability requirements including at least 65% reductions in GHG emissions on a lifecycle basis compared to fossil fuels. According to Maersk, the deal will stretch into the next decade.

The company has 25 owned dual-fuel methanol ships on order of which 7 vessels are already in operation. Maersk has also launched a methanol dual-fuel retrofit project at Chinese shipbuilder Zhoushan Xinya Shipbuilding Co. Specifically, an existing container ship will be converted to methanol by the end of the year and the plan is to expand the retrofit project to several sister vessels when going for a special survey in 2027. To this end, Maersk has contracted German MAN Energy Solutions (MAN ES) to retrofit the engines of a total of 11 vessels equipped with MAN B&W 8G95ME-C9.5 prime movers.

In a separate announcement, Maersk announced a partnership with food and beverage company Danone to reduce its logistics greenhouse gas (GHG) emissions by using Maersk ECO Delivery Ocean.  This means that Danone will transport goods on board Maersk’s ships using bio-diesel or bio-methanol which are produced solely from waste feedstocks.

“With the applied version of ECO Delivery Ocean by Danone the GHG emissions are reduced by more than 40% compared to conventional fossil fuels,” Maersk said.