In our November issue of LNG Industry, Nick Fryer, Vice President of Marketing, Sheer Logistics, addresses the challenges facing modern LNG transportation and explores the digital innovations that can be implemented to combat them.
The LNG industry has been experiencing major shifts over the last few years. Most recently, the US has introduced tariffs that may threaten how much Chinese buyers purchase from the US going forward. This could drastically alter where LNG is being transported around the world, and by whom. It is necessary to build transportation strategies that can adjust to a changing economic and political landscape.
Navigating the complexities of modern LNG transportation
The industry has experienced major growth in the last few years, but there have also been plenty of obstacles to contend with. LNG is not a simple material to transport, nor are the regulations that companies have to comply with while doing so.
Here are the complexities that underpin modern LNG transportation:
Temperature-controlled transit: There is little room for error and transportation requires specialised carriers and systems that can monitor temperature, pressure, and any potential boil-off gas (BOG).
Global supply chain: Like most chemical and energy-related supply chains, the LNG transportation network is global – this makes transportation that much more prone to delay and disruption. It can also make logistics very expensive.
Risk and safety management: The flammable nature of LNG requires strict safety management protocols.
Regulatory compliance: LNG shipments are governed by complex international laws, with each regulatory body requiring its own set of documentation, clearance systems, etc.
Sustainability: Since LNG is mostly transported by sea, the industry is subject to the International Maritime Organization (IMO)’s targets for reducing emissions amongst others, adding regulatory pressure on LNG transport.
How to drive operational visibility through digital integration
The challenges that LNG transportation faces all point to one thing: the need for greater visibility.
Integrated fleet management systems
These systems can provide dashboards that show real-time vessel tracking, fuel usage, engine health, etc. all in one place. The integration is what ensures that data does not end up fragmented and unusable. Instead, it is funnelled through a centralised platform that applies operational benchmarks. These systems are able to generate automated alerts on potential failures with cryogenic control, for example, and flag poor engine health or vessels that are behind schedule.
Sensor-based monitoring
IoT devices and other sensors are being deployed across maritime shipping operations, but they hold particular value when it comes to the high-risk world of LNG. Sensors can detect any anomalies instantly such as hull stress and cargo temperature shifts. This allows for far more proactive responses and less risk of them snowballing into incidents.
Predictive analytics
Usually powered by artificial intelligence (AI) and machine learning, predictive data can help LNG carriers with routing and general fleet maintenance. These algorithms use historical sensor data to spot early signs of failure and plan maintenance.
Digital records
Every time an LNG vessel is tracked and logged in a digital system, it makes it that much easier to provide the necessary records for compliance. This helps companies steer clear of fines and keep their transportation operations as free as possible of regulatory delays.
Unlocking efficiency with data-driven route optimisation
Both real-time data and predictive analytics can be used to completely transform how LNG carriers approach routing. These systems are dynamic. They can provide insights into everything from weather issues to vessel performance, energy efficiency, and geopolitical crises that might cause bottlenecks, unlocking a new level of efficiency in LNG transportation.
Companies can plan their routes according to better fuel usage and see any potential issues ahead of time that may threaten delivery schedules or safety. There are also cost benefits.
Delivery companies utilise routing technology to drive same-day deliveries, but for LNG carriers, the concern is meeting cargo arrival windows, which are often contractual. Missing them can impact customer trust or incur fines. Data-driven route optimisation helps businesses stay on schedule or the platforms can provide the information needed to help negotiate new delivery windows.
Enhancing compliance and safety through smart monitoring tools
LNG transportation is high-risk. Technology, however, can be used to make transportation safer and compliant with regulations. Smart monitoring tools pair IoT and other sensors with AI-powered data analytics so that LNG transportation is not just tracked, but the alert systems and documentation of everything are automated as well.
Smart monitoring reduces the need for manual work while also increasing the accuracy of the task. This keeps everyone safer and ensures that every aspect is tracked digitally so that there can be full transparency with regulatory organisations.
Case study: Digital transformation in LNG transportation
The big name that always comes up when looking at the impact that digitisation can have on LNG transport is Shell. The company has been open about its efforts to digitise operations and the way in which it has helped the company improve on both safety and efficiency.
According to a 2024 report from the company, it has used AI-powered route optimisation to reduce fuel usage by 15%. Its monitoring systems have also achieved a 30% reduction in unplanned maintenance events and 40% fewer safety-related incidents on its LNG carriers. Implementing digital logbooks and automating compliance tracking has also reduced its audit preparation time by 50% and made the company’s adherence to maritime regulations more efficient. These numbers illustrate just how powerful digital tools can be in optimising LNG transport.
Future outlook: Embracing innovation for sustainable LNG logistics
The pressure on LNG logistics to be more sustainable and efficient is not going anywhere. If anything, the parameters are likely to get tighter in the coming decades. Thankfully, the technology that can make LNG carriers more sustainable is what is also set to make them safer and more cost-effective.
Using smart tools like digital routing and fleet systems helps both the planet and companies trying to stay competitive. Seeing how these issues come together and approaching them in a unified way through dynamic innovations is the future of LNG transportation.