BBGI, the biotechnology arm of energy conglomerate Bangchak Corporation, plans to supply a cleaner fuel called "bio-LNG" to ships, replacing liquified natural gas (LNG) and supporting the global campaign to reduce greenhouse gas emissions.
Similar to airlines that are committed to using sustainable aviation fuel (SAF), ship operators are required to use an alternative fuel with less of a carbon footprint.
LNG, heavy fuel oil and marine gas oil are used by ships. Large vessels prefer using heavy fuel oil because of its low cost.
BBGI intends to deliver the new fuel to a marine fleet operated by Singapore-based Kepple, a global asset manager and operator, said Daechapon Lersuwanaroj, chief executive and president of BBGI.
Bio-LNG will be produced from a factory, scheduled to be built between 2025 and 2026, he said. The facility is expected to produce 500 tonnes of bio-LNG a day, or 150,000-200,000 tonnes annually.
Mr Daechapon expects the bio-LNG project to cost between US$100-150 million.
Bio-LNG, also known as liquefied biomethane, is a biofuel made from biogas through a process called anaerobic digestion, which can potentially replace fossil fuel-derived LNG.
BBGI plans to initially use biogas made from solid waste and wastewater from the company's ethanol production plants in Kanchanaburi and Khon Kaen provinces, he said.
The bio-LNG factory comprises a methane gas separation plant, biomethane production facility, and a unit working on fuel quality.
This project marks a new use of biogas, which was previously promoted as a fuel for power plants and cars, said Mr Daechapon.
The bio-LNG project follows a collaboration between BBGI, Kepple and CleanEdge Resource, which specialises in industrial wastewater treatment and waste-to-energy plant development. They signed a memorandum of understanding on a plan to embark on the bio-LNG business in Thailand.
The three companies plan to form a joint venture to operate the business.
Kepple's marine fleet needs to start using biofuel to align with the campaign to reduce greenhouse gas emissions.
BBGI is also co-developing an SAF factory, located near Bangchak's oil refinery in Bangkok's Phra Khanong district. The factory is to be operated by BSGF, Bangchak's SAF production and distribution subsidiary.
Bangchak holds a 51% share in BSGF, with 20% held by BBGI and 29% belonging to Thanachok Oil Light Co, which runs an integrated vegetable oil business.
A biofuel for aircraft, SAF produces up to 80% fewer greenhouse gas emissions than conventional jet fuel, according to media reports citing various forecasts.