Low-GHG methane’s role in keeping LNG-capable ships compliant
A new DNV white paper explores how bio-methane and e-methane, collectively called low-GHG methane, could offer a viable compliance route to help LNG‑capable ships stay compliant as greenhouse gas regulations tighten, benefiting from engine and fuel system compatibility.
Excluding LNG carriers, more than 800 ships can run on LNG using mature, proven technology and established infrastructure, with over 600 more on order.
Under the FuelEU Maritime regulation, LNG‑capable ships can remain compliant on fossil LNG until around 2035, depending on engine configuration. Ships fitted with two‑stroke high‑pressure dual‑fuel engines can remain compliant longer than those using four‑stroke low‑pressure dual‑fuel engines, which are more common in cruise ships and RoPax vessels.
Extending LNG compliance with low-GHG options
DNV’s Methane in Shipping white paper indicates that a potential compliance pathway is the use of LNG-compatible low-GHG fuels. LNG ships are compatible with alternatives such as liquefied bio-methane and e-methane. With tightening GHG intensity requirements, these ships are thus well positioned to transition towards lower GHG emission fuels without major retrofits for these alternatives.
“Bio-methane and e-methane can achieve very low, or even negative, life cycle emissions depending on how they are produced. LNG-fuelled vessels can progressively decarbonize by blending in or switching to these fuels,” explains Øyvind Sekkesæter, Senior Consultant at DNV and lead author of the paper.
Demand for low-GHG methane will grow with tightening regulations
According to demand projections outlined in the paper, compliance-driven low-GHG methane demand under FuelEU Maritime alone could reach 2–4 million tonnes by 2040, rising to as much as 40–95 million tonnes under the proposed IMO Net Zero Framework’s base target.
On the supply side, current production of low-GHG methane is limited, but still higher than many other low-GHG fuel alternatives. Global bio-methane production reached around 7 million tonnes in 2024 and is projected to increase to about 15 million tonnes by 2030. E-methane remains nascent, with only 0.01 million tonnes of operational capacity today, but announced projects could lift this to 0.9 million tonnes by 2030.
While there is significant potential to expand the global supply of low-GHG methane beyond today’s production levels, shipping will compete with other sectors for this supply. Most available supply is already absorbed by power generation and road transport, meaning access for shipping will largely depend on its willingness to pay relative to other users.
Securing low-GHG methane in a competitive market
Regulation will be decisive in shaping this competition. The paper notes that mechanisms such as the EU Emissions Trading System (EU ETS) and FuelEU Maritime are already incentivizing low-GHG methane uptake in shipping. Similar global measures could, over time, strengthen shipping’s willingness to pay to secure supply, while demand from less policy‑driven sectors may remain more price‑sensitive.
“Securing access to low-GHG methane may require long-term offtake agreements, partnerships with fuel producers, or participation in emerging fuel value chains. Fuel procurement therefore becomes both a strategic and an operational consideration for shipowners,” explains Sekkesæter.
LNG bunkering infrastructure applicable
From a technical standpoint, existing LNG infrastructure is largely compatible with liquefied bio‑methane and e‑methane and can, in principle, supply these fuels without physical modifications.
The more persistent constraint lies in economics and market access rather than infrastructure alone. As of late 2025, liquefied bio-methane in Rotterdam was priced at around USD 1,860 per tonne, almost three times the price of fossil LNG. However, when regulatory incentives are taken into account, most notably reduced exposure under the EU ETS and pooling revenues under FuelEU Maritime, bio-methane can already be cost-competitive on selected EU-to-EU voyages.
Unlocking methane supply through flexible mechanisms
Beyond production volumes, availability to shipping is shaped by how low‑GHG methane is accounted for and allocated across sectors.
“This places chain-of-custody models at the centre of the discussion,” says Sekkesæter. “Flexible approaches, such as mass-balance and book-and-claim systems, allow low-GHG methane to be injected into existing gas grids and attributed to end users without requiring physical delivery to a specific location.” Such models can significantly reduce distribution costs and logistical complexity.
In Europe, mass balancing is permitted under regulations such as FuelEU Maritime and the EU ETS, enabling shipping to access low-GHG methane through existing infrastructure. However, the absence of similar flexibility globally, combined with the need for liquefaction and dedicated distribution in the absence of flexible chain-of-custody models, can place shipping at a disadvantage compared to sectors that rely on already established gas. “Without the adoption of flexible chain-of-custody models in international regulation, shipping may face higher costs and consequently more constrained access to limited low-GHG methane supplies,” notes Sekkesæter.
Methane slip can be managed by different measures
While upstream discussions focus on fuel availability and cost, methane slip remains a key onboard challenge associated with LNG use.
Slip levels vary by engine type, which influences a vessel’s well‑to‑wake emissions profile. In response, engine designers have significantly reduced methane slip in recent years through combustion optimization and hardware upgrades, particularly for low‑pressure engines.
“Importantly, the use of real-world measurement data, rather than conservative default assumptions, can improve the assessed methane slip, particularly for modern dual-fuel LNG engines. This has direct implications for regulatory compliance, because lower methane slip translates into better GHG intensity scores,” states Sekkesæter.
Operational practices also play a critical role; measures like optimized engine tuning and load management can further minimize methane slip. After-treatment technologies, including oxidation catalysts, may also offer another layer of mitigation.
Measures keeping LNG-capable vessels relevant in a net-zero transition
LNG-capable vessels can, in both theory and practice, serve as a bridge to net-zero shipping, provided a supportive ecosystem evolves, including scaled production of low‑GHG methane, flexible chain‑of‑custody frameworks, and sufficient willingness to pay to secure supply in competition with other sectors.
In the near term, owners of LNG-capable ships can focus on improving energy efficiency, optimizing engine performance, and reducing methane slip to lower both fuel consumption and compliance costs. It is also important to closely monitor regulatory developments, particularly forthcoming decisions on well‑to‑tank emissions and chain‑of‑custody models.
Sekkesæter concludes: “Ultimately, LNG’s role in shipping will not only be defined by its status as a fossil fuel, but by its ability to enable a transition to low-GHG fuels like liquefied bio-methane and e-methane. As Methane in Shipping makes clear, the opportunity is real: there is already a pathway for today’s LNG-capable fleet to evolve into a lower-emission fleet if the right conditions are put in place. To support shipowners in managing risks and uncertainties related to fuel selection, the paper presents a two-step framework which includes an economic and a technical analysis.”
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