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Power

Engineering excellence around the world

Progress in fast-forward


man magazine

Welcome

to the of MAN Diesel & Turbo. MASTheAD MAN MAGAziNe is published two times a year in English. PUBLiSheD BY MAN Diesel & Turbo SE, Dr. Jan Dietrich Müller, Group Communications & Marketing Stadtbachstr. 1, 86153 Augsburg, Germany eDiToRS iN chieF Jan Hoppe, jan.hoppe@man.eu, Felix Brecht, felix.brecht@man.eu PUBLiSheR C3 Creative Code and Content GmbH, Heiligegeistkirchplatz 1, 10178 Berlin, Germany Tel.: +49 30 44032-0, www.c3.co, Shareholders of C3 Creative Code and Content GmbH are the Burda Gesellschaft mit beschränkter Haftung (limited liability company), Offenburg, and the KB Holding GmbH, Berlin, with 50% each. Sole shareholder of the Burda Gesellschaft mit beschränkter Haftung is the Hubert Burda Media Holding Kommanditgesellschaft (limited partnership), Offenburg. Shareholders of KB Holding GmbH are Mr. Lukas Kircher (managing director, Berlin) and Mr. Rainer Burkhardt (managing director, Berlin) with 50% each. eDiToRS & AUThoRS Cedric Arnaud (resp./C3 Creative Code and Content GmbH, Arabellastraße 23, 81925 Munich), David Barnwell, Hamish Mackenzie, Goeff Poulton, Patricia Preston, Vicki Sussens, Asa C. Tomash, Harry Waterstone PRojecT MANAGeMeNT Marlene Freiberger GRAPhicS Micheline Pollach, Andrea Hüls PhoTo eDiToR Elke Latinovic, Andre Kirsch coVeR iMAGe Waleed Bin Talip PRoDUcTioN C3 Creative Code and Content GmbH PRiNTiNG Pinsker Druck und Medien GmbH Pinskerstraße 1, D-84048 Mainburg, Germany RePRoDUcTioN permitted with reference. Any changes must be coordinated with the editors. coPYRiGhT ©2015 MAN Diesel & Turbo and C3 Creative Code and Content GmbH

The best of Power engineering world WiTh ThiS FiRST iSSUe of MANmagazine

engineering solutions for a broad customer

for MAN Diesel & Turbo, we invite you to ex-

range almost anywhere on the planet, and in

plore our universe of versatile technology. Join

this publication, we strive to bring our readers

us on a world tour to Ecuador, Saudi Arabia,

the most interesting, illuminating and useful

China and Switzerland to discover the fascinat-

topics and stories. We look forward to all of

ing and awe-inspiring details of cutting-edge

your feedback and hope you enjoy a good read.

power, marine and turbo applications. As a global player and oftentimes market leader, MAN Diesel & Turbo provides high-end power

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Find a wide range of additional content online at > www.dieselturbo.man.eu

Cert no. GFA-COC-001415

All information provided in this Magazine is intended for general guidance only and is not intended to be used as a substitute for specific technical or commercial information and advice.


1/2015

Power

coNTeNT

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04

“My home is with the customer”

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Up in thinner air

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Lighting up a brighter future

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MAN Diesel & Turbo’s new CEO shares his view on the company’s strategy and markets. Ecuador’s evolving economy relies on technology by MAN.

Facing still-challenging conditions, Bangladesh is on the move.

Modern getaways

With MAN’s fuel-saving technology, NCL embarks on a new era of cruising.

Testing the limits

In Oberhausen, real-life assessments offer enhanced operation safety.

Sand & power

Building a complete power plant in the middle of the desert is a daunting task. MAN takes on the challenge.

Two voices for one team

MAN Diesel & Turbo and Fairbanks Morse join forces to tackle the world’s biggest gas market together.

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Gas giants

coVeR SToRY: In Saudi Arabia,an MAN Diesel & Turbo team works closely with the customer to provide power.

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Smart savings

26

Protecting profitability

30

Local hero

32

Boom or bubble?

34

News

35

Facts and figures

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Global LNG sourcing, transport and storage enters a new era.

The EcoCam retrofit solution enhances fuel usage for low-load operations.

Optimized machinery trains increase efficiency at a mega PTA plant in China. A new generation of gas turbines offers flexible solutions worldwide.

Where is the global shipping market moving? Two experts share their views. Brief business updates from around the world

Formidable insights and numbers

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man magazine

Leading technology expert MAN Diesel & Turbo serves both a global and a diverse clientele. The company’s new CEO aims to further strengthen customer ties.

a

ppointed to assume leadership of MAN Diesel & Turbo as of 2015, Dr. Uwe Lauber embodies both an engineer with a passion for technological innovation as well as a staunch believer in

customer orientation under any and all circumstances. MAN Magazine conducted an interview to explore Lauber’s outlook and plans. Dr. Lauber, you were appointed Sales

Director and CEO all in the same year. How do you tackle such a far-reaching transition? With tremendous motivation, but also a healthy measure of humility. I have respect for the tasks ahead of me and I am fully aware of the responsibility that the company has entrusted me with. After all, MAN has been successfully writing industrial history for more than 250 years. Yet more than anything else, I feel honored and I’m looking forward to the challenges in store. Considering the global positioning of our company, we must always remain in motion. So there’s a lot to do, and I’m confident that my Executive Board colleagues and I will continue to set the right course for the future. You have a reputation for believing in “uncompromising customer focus.” Would you agree? Our customers and the relationships with them are at the heart of everything we do and I am interested in implementing this paradigm to an even greater extent in our company. Therefore, both orders received as well as growth targets and trends will be bundled within a sales director position at the board level for the first time, which will be my responsibility. Our partnerships with customers are therefore moving further into the spotlight, both from an organizational perspective and in the mind-sets of our

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“my home is where the customers are”


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Focused on the future: Dr. Uwe Lauber strives to reinforce the technological leadership role of MAN Diesel & Turbo.

employees. Among my primary tasks will be a continuously sharpened focus on MAN Diesel & Turbo’s entire portfolio of products and services and to promote our business beyond individual segments. How do you view the current economic situation and where are further growth opportunities for MAN Diesel & Turbo? Today’s economic climate is certainly challenging, but should actually encourage our company to do even better. The future holds vast

15

years

of MAN experience is part of Dr. Uwe Lauber’s vita. He became CEO of about 14,000 employees on January 1, 2015.

potential, as MAN Diesel & Turbo plays a pioneering role in many sectors with regard to

You moved to MAN from Sulzer Turbo

increased ef ficiency for its customers

in 2000 and headed the Oil & Gas business

through technological advantages. Just one

unit. As your background is in turboma-

example is our new range of gas engines –

chinery, do you also harbor a passion for

excellent products with a strong unique sell-

large diesel engines? I’m an engineer to the

ing point. The 51/60G is the most powerful

core, and whether I walk through the produc-

engine available on the market today. I also

tion bays in Augsburg, Oberhausen, Zurich,

feel confident about the Chinese market.

St. Nazaire, Deggendorf, Ravensburg, Berlin,

Pipelines are under construction, and the in-

Hamburg or Changzhou, the giant MAN-made

frastructure for liquid natural gas, or LNG, is

machinery and engines never fail to impress

being expanded. In the future, turbomachin-

and inspire me. It fills me with pride. Indeed,

ery and engines will also be needed. Thus,

turbomachinery is the technological area that

natural gas will continue to play a major role

I’m most familiar with, so I spent weeks prior

in our business model. When converting gas

to my new assignment to introduce myself to

– for example, in coal-to-liquid and gas-to-

colleagues at numerous locations, become

liquid – we also have a unique product in the

better acquainted and seek dialogue with em-

MAX1 compressor, which was designed espe-

ployees on site. It was a marvelous experience,

cially for higher volume flows of higher per-

and I encountered many dedicated and talent-

formance density and increased effective-

ed people who are tremendously committed

ness. Our competitors can rightly envy us.

to the company. Can you outline what you value most

Photo: MAN

about MAN Diesel & Turbo as a company?

Professional profile

Besides a product range that can quicken the

Born in Bad Säckingen in Germany in 1967, Dr. Uwe Lauber obtained a master’s degree in mechanical engineering from the University of Applied Sciences in Konstanz and also studied business engineering at the business school in St. Gallen. In addition, he received a Ph.D. in mechanical engineering from the University of Kronstadt in 2009. After working at the company BOC Cryostar in different positions for more than nine years, he joined Sulzer Turbo – today MAN Diesel & Turbo – in 2000, where he was responsible for the design, R&D and testing of compressors. In December 2010, he was appointed Head of the Oil & Gas business unit, as well as being named CEO of MAN Diesel & Turbo Schweiz AG. On October 1, 2014, he joined the Executive Board of MAN Diesel & Turbo SE, responsible for the company’s global sales and after sales activities, including the Marine business.

fact that MAN is part of the Volkswagen

pulse of any engineer, I’m also proud of the Group. We are a long-established company within a global organization and need to further utilize the effectiveness and strength of two powerful brands. So far, Zurich has been your base, yet your new role takes you to Augsburg. Will you relocate? While I don’t plan to move my family at the moment, I have taken a small flat in Augsburg. Even though I am CEO, I still remain the board member in charge of sales, and that primarily means interaction with customers. Sales executives should never spend all their workdays in the office. My home is where the customers are.

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man magazine MAN Diesel & Turbo supplied next to six engines, but also plenty of auxiliary equipment.

Navigating a labyrinth of lines at roughly 2,400 meters above sea level.

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Photos: Guerra Roberto

The Guangopolo II Plant serves to satisfy the power needs also expanding in Ecuador.


1/2015

my man

Up in thinner air Operating at an altitude of 2,400 meters, MAN engines face challenging conditions in a new Ecuadorian plant.

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ocated near Ecuador’s capital, Quito, the new Guangopolo II Plant extends an already existing site of the same name. MAN Diesel & Turbo has supplied most of the equipment for this facility, namely six

18V32/40 engines designed to operate on heavy fuel and equipped with turbo-chargers type NR34/S, plus six alternators. MAN also provided the auxiliary mechanical and electrical equipment, piping, cabling and electrical set-up material and spare parts, in addition to installation supervision and commissioning. Designed as a base-load plant to deliver power mainly during the dry seasons when hydraulic plants can’t produce sufficient MWh, Guangopolo II serves to satisfy a rapidly growing appetite for electricity: “Ecuador is growing up,” says Isabel Bascones, Guangopolo II Project Manager at MAN Diesel & Turbo. “The country’s expanding infrastructure as well as its fast-paced economic development process consume a lot more power.” Already well-acquainted with the capabilities of MAN, the Cuba-based SIECSA contractor as well as plant operator CELEC, Ecuador’s main utility company, worked closely with the engine specialist during the complete project. When running at 100% capacity, engine output amounts to 8,110 MW each, with a total plant output of 48,714 MW. Since November 2014, the Guangopolo II plant has been poised to contrib-

Vladimir Burbano, Head of Operations at the Guangopolo II facility.

ute to the promising Ecuadorian development.

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man magazine

Photo: Peter Bialobrzeski/laif

Lighting up a brighter future

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1/2015

W

ith a metropolitan popu-

MAN currently involved in a number of proj-

lation of more than 12

ects throughout the country. In 2013, MAN

million, Dhaka is the

received a contract to supply 12 engines for a

10th-largest city in the

power plant project in the capital, as well as a

world and more crowded

further nine for the Gazipur District. Two

than Tokyo, London or

new projects were added in 2014, with the or-

New York. The capital city of Bangladesh, one

der of two identical installations of three 18V

of the most densely populated nations any-

48/60 TS engines each, at the two locations

where, is most often featured in international

Nawabganj and Manikganj, just outside Dha-

news with issues such as horrific traffic jams or

ka. All of these new facilities are powered by

flooding. Yet despite many still crushing prob-

MAN engines, generating electricity from

lems such as deep-rooted poverty, Bangladesh

diesel, while providing the extra power and

is slowly emerging as an economic player: A

stability Bangladesh needs to better reach its

2005 paper published by Goldman Sachs and

potential. “Our plants can be set up within a

economist Jim O’Neill already looked beyond

reasonable time frame and operate in remote

the BRIC nations to the countries that would

areas,” says Alexander Stöckler, Head of Sales

shape the economic future of the 21st century,

for Middle East and North Africa for MAN

and identified the Asian country as one of “The

Power Plants. Gas turbines, one of the most

Next Eleven.” While GDP growth rates for Ban-

common power plant technologies in the de-

gladesh have indeed surpassed 5 percent per

veloped world, are also not as efficient at this

year in the last decade, unique challenges re-

smaller scale, considering the difficult load

main for the developing country, with none

pattern of the local grid. According to Stöck-

more vital than providing reliable power

ler, the weak network needs power plants that

sources. According to the CIA World Fact Book

are capable of responding at short notice, be-

2014, Bangladesh (population about 166 mil-

cause fluctuations in the grid impact the op-

lion) and Hong Kong (7 million) currently

erating pattern and diesel engines are far

share the same power generation capacity,

more suitable for responding to these inter-

which obviously leaves much room for im-

ruptions. “This is one reason why some of the

provement. Yet without an established infra-

diesel power plants operate at peak load

structure, the technology to generate and dis-

times,” he explains.

tribute electricity that might work elsewhere

Sustainable long-term growth can happen

is unsuited for this Asian nation – which is

even in the face of still-unresolved challenges,

where MAN comes in.

and diesel-powered generators by MAN are

The Bangladesh Power Development

another guarantor that the people of Bangla-

Board called on foreign investors to provide

desh are on the right track for a future of de-

an additional 1,000 MW of capacity, with

velopment and more economic stability.

India Bangladesh 7 1

India

As Bangladesh’s most populous city, Dhaka has not only a vibrant cultural life, but also torrential traffic.

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2 3

4

6

MAN Diesel & Turbo Power plants - Already installed: 1 and 2 Shantahar / Katakhali, 2 x 6 x 18V 32/40 - New Orders 2013/14: 3 CLC, Dhaka 12 x 18V 32/40 4 Desh Energy 3 x 18V 48/60TS 5 Kodda 9 x 18V 51/60DF 6 Nawabganj 3 x 18V 48/60TS 7 Manikganj 3 x 18V 48/60TS

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man magazine

W

ith the maiden voyages of the Norwegian Breakaway in April 2013 and the Norwegian Getaway in February 2014, American cruise line operator Nor-

wegian Cruise Line (NCL) set out on an ambitious mission to drastically improve the modern getaway experience. The Norwegian Breakaway and the Norwegian Getaway are part of NCL’s Breakaway line, each with a capacity of 4,028 guests and a crew of 1,640, making them some of the largest ships to cruise the eastern Caribbean Sea. The Breakaway line serves as the backdrop for NCL’s “Freestyle Cruising” concept, with no set times or seating arrangement for meals, no formal attire, and a brandnew approach to deck design, allowing for easy access to shops, restaurants and bars. Another four ships will added be to the Breakaway fleet over the next years, as part of a new Breakaway Plus line: the Norwegian Escape is set to embark on its maiden voyage in fall 2015, and the Norwegian Bliss will follow in 2016. Finally, another two ships are planned for 2018 and 2019, as well.

Modern modern getaways

The meyer WerfT in Papenburg, Germany, is undertaking the construction of the new ships. “We are very pleased with the continued confidence NCL has shown us by tasking us with expanding their fleet,” says Bernard Meyer, Managing Partner of Meyer Werft. The shipyard relied on the know-how of MAN Diesel & Turbo, equipping the first two Breakaway ships and with two 12V and two 14V 48/60CR four-stroke medium-speed diesel engines, with a combined capacity of 62,400 kW. In the planning for the Norwegian Escape and the Norwegian Bliss are three 12V and two 14V 48/60CR engines, boosting overall capacity to 76,800 kW. NCL was the first company to introduce MAN 48/6CRs into its operating fleet seven years ago. Ever since, all its MAN powered newbuilds have been ordered with the fuel saving electronic CR injection system. “The system provides superior performance compared with conventional engines,” says Benjamin Andres, Head of Order Management Cruise & Ferry at MDT. “We are proud to help bring the modern cruise experience into the future.”

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The Norwegian Getaway has its home in New York and will offer luxury cruises in the Caribbean.


1/2015

The advanced MDT 48/60 CR four-stroke engines power the Breakaway fleet.

Photo: gettyimages, Ingrid Fieback (2)

The Getaway is the second ship in NCL’s Breakaway fleet of luxury cruise ships.

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man magazine

m

any miles out at sea or far away from solidly grounded infrastructure, safety and reliability is of paramount importance when operating the heavy machinery and

installations needed to explore for natural resources. Extensive equipment testing prior to installation saves time, money and even lives – thus serving the pursuit of lower-risk strategies. Completed in 2012, the multi-purpose and open-air test facility (MUENSTER) in Oberhausen, Germany, can perform gas turbine, compressor and power generation tests for customers in the oil and gas as well as process industries. “Companies are trying to access deeper and more complex sources of oil and gas, which places higher demands on their utilized equipment. Comprehensive testing is more important than ever,” explains Thomas Müller, Head of Testing in Oberhausen. Müller and his team work closely with other MAN teams, especially those in Zurich,

Testing Photo: MAN

the limits for safer energy sourcing

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1/2015

that are engaged in both design and manufac-

it to run. “While we usually aim to complete

turing of gas and steam turbines and high-

the actual testing in less than a week, the con-

pressure compressors used to transport and

figuration phase can easily take months,”

store different types of gases. Each test proce-

adds Müller.

dure is tailor-made according to customer re-

Already equipped to test electrical driver

quirements. The MAN site recently completed

systems with outputs up to 20 MW, the

testing of some gas turbine-driven packages

MUENSTER site plans to increase this capacity

– for example, a completely in-house-manu-

to 40 MW. “As electrical drivers become more

factured train for the Hejre Offshore field in

popular, we’ll also be able to accommodate

the North Sea, as well as a gas-turbine-driven

any requested driver frequency,” adds Mohr.

compressor train for a UK oil and gas operator

Due to its sliding weather protection, the

focused on North Sea production, appraisal

MAN Diesel & Turbo facility can operate

and development activities. Work will also be-

under cover or open air, enabling so-called

gin shortly on another unit for BP, deliverable

Type 1 testing. “Thus, we run the machinery

to the Shah Deniz oil field off the coast of

exactly as on site, with the same gases, rather

Azerbaijan. “Yet our involvement actually be-

than compromising in gas density as with

gins as early as the design stage, as we have to

Type 2 testing. As these are often explosive or

configure the testing field at the same time,”

toxic, we need comprehensive safety proce-

says Klaus-Dieter Mohr, Head of Assembly,

dures here,” explains Müller. Currently the

Packaging and Testing at the site. When a

exception rather than the rule, Type 1 tests

compressor skid arrives in Oberhausen, the

will become more common. “The risks for our

team must finalize the plumbing, pipe work

customers are high, so they must know their

and other electrical connections required for

equipment has been tested to the limit.”

40

mw capacities are an expressed objective at the MUENSTER facility to accommodate testing of electrical driver systems with larger outputs.

The open-site testing area at MAN Diesel & Turbo’s Oberhausen location allows for full-load testing with potentially dangerous gases.

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Engineer Ayed Al-Fayedi serves as Vice President of Operations at the UCIC construction site and works closely with the MAN team.

Photos:

man magazine

Sand &

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1/2015

Slow and steady: Carrying huge engines, trucks rumble toward their destination 150 kilometers south of Jeddah.

Power

Photos: Waleed Bin Talip

Supplying the massive engines and all ancillary equipment for a new cement plant in the desert of Saudi Arabia, MAN Diesel & Turbo SE once again meets the challenges of problem-solving in a very remote location.

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man magazine

B “if you need to deal with a problem today, you have made a mistake half a year ago.” Ralf Göppel, Senior Project Manager, MAN Diesel & Turbo SE

etween Saudi Arabia’s Jeddah

the engines, but also all ancillary equipment

Islamic Port on the Red Sea and

– ranging from the machine control-room and

the Al-Sadiya Mountains, a des-

cooling systems to the processing and disposal

ert area not far from Mecca,

systems – while the local consortium partner

there is little more than sand and a handful of

Al Aman Company is responsible for all civil,

camels and sheep. Yet in November 2014, five

electrical and mechanical construction and in-

giant trucks hauling huge monsters of steel

stallation work. The project was signed off in

rumbled through the desert – scary black sil-

summer 2013, with construction commencing

houettes against an ancient golden landscape.

a year later and final power plant handover to

Their cargo was a 130-ton MAN 20V32/

the customer scheduled for February 2016. The

44CR diesel engine for a new cement plant un-

trailers’ just-in-time arrival at Old Makkha

der construction in the limestone-rich Al-Sadi-

Road, from where they turned east to the UCIC

ya site on behalf of the United Cement Indus-

site, was a timing triumph for senior project

trial Company (UCIC), a Jeddah-based Saudi

manager Ralf Göppel and his team at MAN

business established in 2013. MAN Diesel &

Diesel & Turbo headquarters in Augsburg. Had

Turbo had received an engineering, procure-

the engines arrived too early, they would have

ment and construction (EPC) contract valued

disrupted work on the project’s ongoing build-

at €32 million to build an independent diesel

ing phase, while laying the foundations for the

power plant for the new facility. In its product

powerhouse, pumphouse, radiator area or tank

portfolio, MAN Diesel & Turbo carries specifi-

farm. Had they arrived too late, the delivery

cally engineered power plants for remote loca-

would have delayed the next stage of construc-

tions with no access to electricity grids (island

tion, especially installing the auxiliary mod-

mode) all over the world. And as these are the

ules, steel structure, piping and cabling as well

only source of power, technical excellence is

as the installation of the 35-ton alternators in-

essential. Supplied MAN engines for this proj-

side the powerhouse.

ect feature modern common rail technology,

Each of the five engines features 20 cylinders providing 560 kW/Cyl and renders a performance of more than 15,000 hp.

an electronically controlled injection system

Timing The exacT arrival is essential in a

that controls fuel consumption and emissions.

project like this,” says Göppel, who always has

For the UCIC project, MAN supplies not only

to cope with all kinds of eventualities, including sandstorms, local incidents, late deliveries or sudden lack of manpower. Delivering all plant components to the UCIC site is a huge exercise in logistics. While the Diesel engines were built in MAN’s Augsburg works, most of the other equipment was purchased from global suppliers as far away as India or Finland. They all must first undertake an almost epic journey via European North Sea ports, to Jeddah, and finally move down a sandy gravel road to the UCIC site. For the first time, engines of this type were initially put on a train to travel from Augsburg to Duisburg in Germany for final assembly, later transported via the Rhine River to Antwerp in Belgium and then shipped to Jeddah in Saudi Arabia. Overall, it took more than a month to arrive at the plant in the desert. Saudi Arabia’s cement industry is flourishing, due to a construction boom caused by demographic and macroeconomic factors.

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1/2015

register a loss of air-intake pressure, while a huge system of radiator coolers is designed to regulate the cooling water systems. Göppel describes his Saudi-specific challenges as: “Sandstorms! Ramadan! Heavy rain!” In spring and summer, the northwesterly Shamal wind creates sandstorms that can cut visibility to almost zero. In 2014, such storms interrupted onsite work almost every afternoon from June through August. Although rare, rain is also a problem, as cities and environs are not equipped with rainwater drains. Jeddah was completely flooded after heavy rainfalls back in 2010, with hundreds of people killed. “When it started to rain in November 2014, the workers panicked and left to reach their families,” recalls Göppel. Also that year, Ramadan, the ninth month of the IslamThe MAN team meets with project engineers to discuss the last preparations before the first engine arrives.

50°c durinG daytime

Photos: Waleed Bin Talip

Crippling ambient temperatures are just one of the challenges when working in the desert. Others are sandstorms and even flooding episodes.

ic calendar, proceeded during the month of July, when daytime temperatures reached

A growing population and changing family

50°C in the shade – if there was any shade.

structures – such as the trend toward smaller

While faithful Muslims may work throughout

households – are increasing demand for resi-

this period, they must fast during daylight

dential properties and new industrial areas, in-

hours. Göppel solved the issue by switching

cluding big oil refineries. At the same time, the

work shifts to night time during the month of

government vastly increased infrastructure

Ramadan. Another aspect slowing down work

spending since 2013, resulting from a great year

schedules are the five required prayer sessions

for the oil industry in 2012 and an associated

per day. “We expect less daily progress in Sau-

20% surplus in GDP.

di Arabia than in other countries, which must

This has turned the kingdom into the larg-

be reflected by work schedules,” says Göppel.

est projects market in the Middle East, accord-

For the four weeks of Ramadan, for example,

ing to the “Saudi Arabia Projects Market 2014”

he calculates a 50% reduction in progress and

issued by MEED, a Middle East business intelli-

even 70% less efficiency during the annual

gence provider. “Saudi Arabia is a key market

fortnight Eid and Hajj holidays. A vital factor

for our power plants division, where we have

is the skilled MAN team of managers and su-

gathered decades of experience,” says Howard

pervisors on site, who are coordinating and

Barnes, Senior Vice President and Global Head

driving the construction efforts. Some remain

of Sales Power Plants. The UCIC power plant will

in the desert of Saudi Arabia for a year or even

supply 55 megawatts , facilitating a cement pro-

longer. On average, MAN has between 18 and

duction capacity of around 5,000 tons per day.

22 months to finalize a power plant project,

Remote sites are, by nature, difficult to access

with significant fines and penalties built into

and each project presents its own engineering

the contract for late handover to the customer.

and logistical challenges. The engines at UCIC

“It ’s important to quickly identify any real

were designed to withstand local conditions,

problems and how to address them,” says Göp-

including temperatures of up to 50°C. Special

pel, who claims that almost nothing can ruffle

pulse filter systems in front of the air-intake

him anymore. “When you have a great team

ducts keep sand particles out, using com-

like mine, be it on site or at headquarters, this

pressed air to blow air filters free when sensors

is the most exciting job in the world.”

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man magazine

Two T voices for one team

he U.S. energy market is undergo-

sources of energy, primarily coal and nuclear.

ing a revolution, a new gold rush

New infrastructure is being built to transport

for the 21st century, but this time

the gas to its point of use, and U.S. energy pro-

the prize is natural gas. Thanks to

viders are replacing existing generation facil-

technological developments in

ities with distributed power, a network of

horizontal drilling and hydraulic

smaller gas-powered generators, more effi-

fracturing, it has become possible to tap natural

Through a strategic cooperation with engine expert Fairbanks Morse, MAN Diesel & Turbo broadens its access to the booming natural gas market in the U.S.

cient and more environmentally-friendly.

gas reserves that would not have been econom-

These new market conditions form the

ically viable using conventional exploration

backdrop for a new cooperation between MAN

methods. In 2013, shale gas production ac-

Diesel & Turbo and Fairbanks Morse, one of the

counted for approximately 40% of contiguous

top three companies in the U.S. energy market

U.S. Natural gas production, up from about 5%

in terms of installed megawatts. Fairbanks

in 2006, and this number is projected to rise

Morse will use their contacts and experience

further over the next 20 years.

to bring MDT engines to a new, broader market

The abundance of gas has pushed down its

in energy production, a synergy with tremen-

price, making it far more attractive than be-

dous opportunities for both parties. We sat

fore in comparison with more traditional

down with Marvin Riley and Howard Barnes to talk about the future of this bold new venture. Is it fair to say that this is a new golden age for gas in the U.S.? Marvin Riley: Absolutely. We expect 1,900 miles of new natural gas pipelines to be built over the next two years, and this is primarily because of the shale gas revolution. The gas generation market is booming, and we would like to take full advantage of that. The infrastructure is being built to support whatever technologies will take advantage of it. In the future it could be transportation or other technologies, but for now, the growth is in power generation. Howard Barnes: And this has opened up new opportunities to expand our existing partnership. FME has licensed MAN engines for the marine market since 1995 and they have a

Founded in the late 19th century and now an EnPro Industries company, power solutions expert Fairbanks Morse Engine (FME) is a manufacturer of heavy-duty, mediumspeed diesel, natural gas and dual-fuel engines from 0.5 to 3 MW for applications specifically tailored to marine propulsion, power generation, pumps and compressors. FME covers a wide range of municipal, institutional and industrial applications, primary customers being the U.S. Navy and the U.S. Coast Guard: 70 percent of the U.S. Navy fleet uses FME engines, with supplier relations dating back more than 70 years. Based in Beloit, Wisconsin, and represented through service centers across the U.S., FME has been a MAN Diesel & Turbo licensee for marine turbine technology since 1995. www.fairbanksmorse.com

18

strong footprint and a strong presence in the U.S.A. So it was a very logical step for us when

Howard Barnes is Senior Vice President at MAN Diesel & Turbo as well as Global Head of Sales for the Power Plant business.

Photos: MAN, Stephen Voss

about Fairbanks morse:


1/2015

“We have had a great response from customers.” Marvin Riley, President, Fairbanks Morse Engine

sectors, with manufacturing and assembly fa-

been visiting us in Germany to get to know

cilities in the U.S. They have satellite offices in

the technology and the gas engine product.

many important segments of the U.S., so the

During a second phase, we’re launching this

infrastructure is there, and this is infrastruc-

product in the marketplace directly, with util-

ture that we don’t have. While FME does pro-

ities, with industrial groups.

duce engines, they are of a much smaller size,

How has the market reacted to news of

namely in the range of 0.5 to 3 MW. The en-

this cooperation?

we wanted to expand our presence that we

gines we make are substantially larger, so

MR: We have had a great response from cus-

should work through Fairbanks Morse.

there’s no conflict. There’s really only synergy.

tomers, and we’ve been very busy. We have al-

MR: And what MAN brings to the table is not

ready met with at least 16 EPC firms, doing

different from the systems it is replacing?

only a great product, and a great-performing one

lunch and learns. We have agreed to do much

MR: With the change in market conditions,

at that, but a legacy of engineering excellence.

deeper dives with some of the customers that

How is the newly installed infrastructure

there are a large number of coal retirements

What has happened since the coopera-

have an extensive project list, and we have

taking place in the U.S., and the nuclear indus-

tion was signed in June?

also started to bid on a number of projects.

try is basically flat. The real growth is in dis-

HB: We kicked off with quite an intensive

HB: I think the cooperation so far really has

tributed power. When you retire a coal plant,

training and familiarization program where

been very good. Fairbanks Morse is also an

you won’t replace that coal plant with an

Fairbanks specialists in most disciplines have

engine manufacturer, so we speak the same

equivalent plant that has the same capacity.

language. We understand each other. I trust

You replace the power with smaller, distrib-

that once we’ve passed the five-year bench-

uted, more efficient gas-fired power plants,

mark, we will have established a business that

and these facilities are a perfect fit for recip-

is profitable and sustainable.

rocating engines. HB: We foresee considerable investment in decentralized gas-based power plants, varying in size between 10 and 200 megawatts. What’s interesting is that we have made a number of developments in gas engine technology over the last few years, and these new gas engines are able to operate in conditions that are suited to the U.S. The market, going decentralized, is looking more and more for peaking applications, and gas engine technology is very suitable for this. What do you see as the benefit of this cooperation, for your company? HB: Fairbanks Morse Engine is well established in the marine and power generation

Marvin Riley was appointed President of Fairbanks Morse Engine in 2012, after holding various positions at EnPro Industries and General Motors.

19


gas giants

man magazine

Worldwide sourcing and distribution of LNG has grown into a major industry player while seeking to balance the growing global appetite for affordable energy with environmental concerns.

20


1/2015

The new LNG carrier “Veliky Novgorod” features a dieselelectric, dual-fuel propulsion MAN Diesel & Turbo system.

A

mong the largest commercial vessels cruising the oceans today are liquid natural

gas

carriers

(LNGCs) that are almost 300 meters long and more than 45 meters wide. One of the most common vessel sizes is capable of carrying 170,000 cubic meters of super-cooled LNG from its country of sourcing to where it is needed to generate electricity to light and heat homes and power the wheels of industry. MAN Diesel & Turbo is in the fortunate position to offer ship owners either four-stroke dual fuel engines for diesel-electric propulsion or twostroke MEGI high-pressure gas injection for conventional propulsion. Typically diesel electric propulsion solutions are powered by two 8L51/60DF and two 9L51/60DF types with a combined total output of 34 MW. And the

Photos: all mauritius-images, courtesy of OAO Sovcomflot

market is booming. In July 2014, SinoShip News announced that China is planning to build 60 new LNGCs by 2020, at a total cost of $12 billion. While this trend is partially driven by increased gas production in the United States through non-traditional methods, LNG is also attractive due to its green credentials. NAturAl gAs burNs far cleaner than other fossil fuels do, producing 30% less carbon dioxide than petroleum and 45% less than Securing power: The sprawling LNG storage facilities at the Rotterdam port in the Netherlands.

coal, as well as significantly lower levels of sulfur and nitrogen oxides. “Natural gas and air are mixed before entering the combustion

21


man magazine

MAN Diesel & Turbo engines will provide the power for this floating storage and re-gasification unit, anchored four kilometers offshore from Montevideo, Uruguay.

263,000 cubic meters

is the overall storage capacity of an FSRU unit currently under construction in South Korea, so far the largest worldwide.

22

chamber and ignited via a small quantity of

destination port, the liquid gas is unloaded

injected MDO/MGO pilot fuel. The combus-

before warming up and decompression for fu-

tion process according to the Otto-cycle en-

ture use. While this had traditionally been ac-

sures the lowest nitrous oxide (NOx) emis-

complished in on-shore facilities, another so-

sions when operating in gas mode, which are

lution has been available since 2005, namely

lower than projected future emission limits.

a floating storage re-gasification unit (FSRU).

For the sake of fuel flexibility, the engine can

This unit sits a few miles offshore, allowing

operate alternatively in liquid mode, where

LNGCs to dock and unload their cargo of LNG.

fuel oil is injected via conventional main

This gas can then be stored directly at the

pumps as in the 48/60B HFO engine,� ex-

facility before being pumped ashore through

plains Dietmar Zutt, Head of Sales Merchant

a subsea pipeline. Compared with an onshore

Marine at MAN Diesel & Turbo.

facility, an FSRU can be set up with minimal

The booming LNG market is driving more than ship production, however. There is sig-

impact while its mobility allows for relocation if market demands change.

nificant growth and investment at every stage of the process chain, ranging from new

in OctOber Of 2013, the Japanese shipping

production facilities and pipelines to new gas-

company Mitsui O.S.K. Lines (MOL) signed a

burning power plants to utilize the abun-

so-called BOOT (build, own, operate and trans-

dance of gas. One important link in this chain

fer) contract for the duration of 20 years with

is present at the beginning and end of every

the Montevideo-based joint venture Gas Say-

LNGC journey, specifically in the ports where

ago for LNG storage and re-gasification servic-

the vessels are loaded and unloaded. A lique-

es in Uruguay. Currently under construction

faction facility is required to cool and com-

at Daewoo Shipbuilding & Marine Engineer-

press the gas before taking it on board. At the

ing in South Korea, this FSRU will have a stor-


1/2015

Five decades of LNG

Commissioned in 1964, the LNG Tanker “Methane Princess” delivered the world’s first commercial liquefied natural gas to a British re-gasification terminal. Since then, the sector has assumed an important role in the global energy industry.

All time LNG trade totals 3,667 miLLioN metric toNs of LNG (the equivalent of 4,978 bcm of gas).

424 LNG ships have been built and more are currently on the order books.

Japan: 1,707 South Korea: 464 Spain: 295 France: 268 Taiwan: 151 USA: 148 Others: 635

Indonesia: 721 Qatar: 566 Algeria: 525 Malaysia: 439 Australia: 268 Brunei: 238 Others: 911

South Korea: 329 Japan: 116 France: 38 China: 20 USA: 16 Others: 32

Scrapped: 31 Current Fleet: 393 Order book: 127

million tons

million tons

no. of ships

no. of ships

by importer

by exporter

LNG fleet by shipbuilding country

LNG fleet by current status

age capacity of 263,000 cubic meters of LNG,

where the vessels are actually built. “Last, but

rendering it the largest worldwide. Construc-

not least,” adds Bale, “the fact that the engines

tion will be completed by September 2016, and

were ‘Made in Germany’ was a factor in the

the unit will enter service in November 2016,

selection process, as this assured us that pro-

following delivery and commissioning at the

duction and testing were of the highest qual-

port of Montevideo.

ity as far as engine design is concerned.”

Photos: GDF Suez S.A.

“The business success of FSRU technology is rooted in cooperation and trusting rela-

“Due to their cuttiNG-eDGe technology,

tionships among national governments, fi-

these engines are highly efficient and there-

nancial investors and gas industry operators,”

fore attractive to buyers. In gas mode, the en-

says Christian Bale, Head of LNG Offshore at

gine operates according to the lean-burn

MOL. “The recent contract with Uruguay re-

four-stroke Otto combustion process,” says

sults in the FSRU being moored only five kilo-

Zutt. “The premixed lean gas/air mixture is

meters off the coast of Montevideo, thus aptly

ignited by the compression ignition of a small

illustrating the necessary cooperation with

quantity of injected MDO-pilot fuel into the

well-known and established partners.”

main combustion chamber. The amount of

Power on the FSRU will be generated by

this injected pilot fuel is less than 1% of the

MAN dual-fuel engines with the flexibility to

full-load liquid fuel quantity. This ensures the

run on diesel or excess LNG, as required. “We

lowest NOx emissions in gas mode, which are

chose MAN engines for a number of reasons,”

even lower than projected future emission

says Bale. “MAN is a credible manufacturer

limits. In the liquid fuel mode, the fuel oil is

with a good reputation and offers suitable

injected via the conventional main pumps as

dual-fuel engines that meet our objectives of

in the 48/60B–HFO engine.”

low liquid and gas consumption, low emis-

As part of Uruguay’s energy policy plan

sions, local support in Korea for the Daewoo

2005-2030, the LNG import terminal project is

Shipyard and also where the vessel operates.

a cornerstone for energy development in this

As the installation won’t move from its off-

country and considered a top priority by the

shore position for 20 years, it is essential to

government. It is projected that it will signifi-

receive MAN’s support to ensure uninterrupt-

cantly change the national energy market by

ed operations.” Bale also emphasizes that the

providing an additional clean fuel source and

available training courses on the dual-fuel en-

reducing the share of imported oil in the en-

gines are absolutely essential for MOL em-

ergy mix. This strategy is not only good for

ployees – and not just in Germany, but also

business, but also good for the planet.

“Working with well-known and established partners is essential in the LNG business.” Christian Bale, Head of LNG Offshore at MOL

23


man magazine

Smart SavingS

a

The MAN EcoCam retrofit solution for lowload optimization of low-speed mechanical engines improves fuel efficiency with a simple yet ingenious approach to diesel engineering.

The MAN EcoCam’s effect on NOx levels has been taken into consideration and is in compliance with IMO regulations.

simple solution with great impact; this is the premise behind the new MAN EcoCam retrofit solution. The

MAN EcoCam takes advantage of existing

Earlier closing of the exhaust valve allows for around 10% higher compression pressure.

3

mechanical engine technology by adjusting the amount of actuator oil in the engine’s hydraulic pushrod (1). In effect, oil is drained off the circuit through an added pipe (2), which enables the exhaust valve to close earlier than in a traditional diesel engine. The result is higher compression pressure (3), and the creation of a “virtual” or flexible cam profile. This profile serves as the backbone of an optimized circuit that allows higher combustion pressure even at lower fuel-oil consumption (4). “The MAN EcoCam adjusts the exhaustvalve timing between 10% and 60% load, giving a 2-5g/kW fuel saving with minimal to no interruption to a vessel’s schedule during installation,” says Christian Ludwig, Head of could mean payback periods as small as 18 months. Even with oil prices on the low end, the technology is still be feasible. The MAN EcoCam is available for S50MC-C engine types, but will soon be rolled out for the whole midbore and large-bore engine program.

24

Illustration: Hokolo 3D

Retrofit & Upgrade. For smaller engines, this


1/2015

1

The amount of actuator oil influences the hydraulic pushrod.

2

Draining off actuator oil allows the exhaust valve to close earlier.

With fuel savings between 2-5 g/kW, the MAN EcoCam could pay for itself in as little as 18 months, for smaller engines.

Adjusted valve opening.

The cam’s profile is controlled by the adjusted amount of actuator oil. This allows for the new flexible or “virtual” cam profile.

4 25


man magazine

The PTA plant operated by the Hengli Group is located in Dalian, in the south of China’s Liaoning Province.

26

Foto: Photos: Eric Gregory Powell

Protecting profitability


1/2015 Teamwork and trust is essential for a project of this magnitude.

The rising cost of raw materials exerts pressure on manufacturing margins. By increasing production efficiency, MAN Diesel & Turbo production trains facilitate even expanding competitiveness for a leading PTA manufacturer in China.

B

ased in Dalian, China, the Hengli Group is one of the world’s major manufacturers of terephthal-

ic acid (PTA), one of the key chemicals used in making plastics and textiles. Recently, the rising costs of raw materials have squeezed margins to the point that some of the company’s

“With this partner, we have entered the league of mega PTA plants.”

competitors have struggled to stay profitable.

Dr. Lothar Wallscheid, VP Basic Industry segment, MAN Diesel & Turbo

veloped four machinery trains that became

The Hengli Group, however, has managed to buck that trend. One of the key reasons for this business resilience is its decision to use MAN Diesel & Turbo production trains to upgrade the efficiency of its manufacturing facilities in Dalian. “With the Hengli Group as one of our major partners, we’ve entered the league of mega PTA plants,” says Dr. Lothar Wallscheid, VP Basic Industry segment at MAN Diesel & Turbo. “For the Dalian facility, we initially deoperational in 2013. As requirements grew, Hengli ordered another two identical trains – so far the world’s largest of their kind.” “Our trains are the beating heart of PTA production for Hengli,” adds Marc Groß from MAN Diesel & Turbo’s onsite team. “The train consists of a compressor that powers the production reactor, an axial expander used to recover energy from the production process, as well as a steam turbine and engine generator to produce electricity powering the plant.”

This radial gear stage compressor RG160 reflects the rapid turbine development of recent years.

Hengli’s PTA production facilities are of particular strategic importance to the company, because around 50% of the manufactured

27


man magazine

Condenser of a state-ofthe-art steam turbine – integrated energy concepts ensure maximum efficiency.

Each of the machine trains includes an expander for energy recovery.

PTA output is actually consumed within China

trains and worked hard to build a deep under-

for the national textile industry. This strategic

standing of Hengli’s specific requirements.

move also helps protect it from the volatility

That’s why they selected us, even though our

of the PTA market – another reason why the

bid was higher than some of the others. Our

upgrading of its production trains with

customer was willing to invest a little more to

MAN Diesel & Turbo equipment plays such an

receive the highest quality and most reliable

important role for the company.

solution. At the end of the day, the fact that our equipment just works was probably the

“MAN Diesel & Turbo is by far the world-

key differentiator for us,” notes Groß.

wide market leader in the development and manufacturing of machinery trains for PTA production,” says Jörg Meier, project manager

valued HigHly by THe cusTOmer in Dalian

at MAN Diesel & Turbo. “Within the last five

is the fact that MAN Diesel & Turbo team work

years, more than 20 such trains were built

on trains 5 and 6 was completed in early 2015,

worldwide at a cost of several million euros

significantly ahead of schedule. “There were

won the contract based on the quality and reli-

Marc Groß, Onsite Project Manager

afTer Having effecTively upgraded four production trains at the plant, Hengli decided to modify its production process for trains 5 and 6 to improve efficiency still further. De-

28

no major issues with deployment or operation of any installed production trains and we managed to shorten the project duration twice,” he says. “The Hengli Group values that very highly.” Customer focus also plays a key role for Lothar Wallscheid: “As the world’s population rises, so does the need for basic materials such as terephthalic acid,” he explains.

ability of its machinery and outstanding tech-

“The PTA industry offers an excellent example

nical knowhow, supported by a highly collab-

for how our development work allows custom-

orative customer relationship. “We developed

ers such as the Hengli Group to continuously

a high level of trust with the Hengli manage-

optimize their processes with regard to effi-

ment team during the upgrade of the first four

ciency and capacity.”

Photos: Eric Gregory Powell

spite tough competition, MAN Diesel & Turbo

“Our machinery trains are the heart of Hengli’s PTa production.”

each – and most of them came from MAN.”


2

1/2015 Labyrinthine stairs provide access to the overhead oil tank, visible at upper left.

years

was the total project duration. Even though upgrading a PTA production train is a complex undertaking, MAN Diesel & Turbo completed the project significantly ahead of schedule.

The secret to this success story is the excellent cooperation between teams from across the MAN Diesel & Turbo organization, the Hengli Group and its partner INVISTA, a subsidiary of US-based Koch Industries. “We have had a trusted cooperation with our partners from MAN Diesel & Turbo for years,” says Mike Lin, Vice General Manager at Hengli Group. “Together with us, MAN has raised the production of PTA to a new level, hence substantiating the leading position of Hengli.” All of these factors result in enhanced customer satisfaction, which places MAN Diesel & Turbo in an excellent competitive position if and when the Hengli Group decides to upgrade more of its PTA production trains. This particular partnership also looks promising, as the Hengli Group pursues a broad range of interests and activities across many different manufacturing areas. These include petrochemical refining, a field where MAN Diesel & Turbo offers a high level of experience and expertise in equipment manufacturing. Considering the supplier’s focus on high quality and reliable machinery, the successful cooperation in Dalian provides an outstanding platform for future success.

29


man magazine

In times of continuously rising energy costs and efficiency focus, a new generation of gas turbines offers flexible solutions for applications worldwide.

Starting up in late summer 2013 at the SolVin plant in Rheinberg (above), the first custom-tailored MGT gas turbine package has proven itself an innovative and reliable power generation system.

30

Photos: MAN

Local Hero


1/2015

D

ecentralized energy produc-

Plant Manager of SolVin in Rheinberg. As the

tion to supplement or even

system also harnesses the turbine’s waste

replace dependence on con-

heat, it reaches a high overall utilization rate

ventional power grid infrastructures has cer-

of more than 80 percent — thus saving emis-

tainly been on the minds and drawing boards

sions of about 7,000 tons of Co2 per year at

of engineering experts for a while. Yet as Ger-

just the Rheinberg production site.

many currently debates how to best implement its consensus-built energy transition

the new MGt Gas turbine systeM pro-

process, including some passionate controver-

vides state-of-the-art reliability with a small

sy over the construction of high-voltage pow-

footprint. “Its size, very low maintenance de-

er line corridors to transfer wind-generated

mand and short installation schedule makes

power from the North to the economically

it suitable for flexible deployment anywhere

booming South, both the public and private

in the world, where decentralized power gen-

sectors increasingly engage in efforts to in-

eration is needed,” says Sven-Hendrik Wiers,

crease their independence.

Vice President Gas Turbines, MAN Diesel &

While solar panels on the roof and a biogas

Turbo in Oberhausen, Germany. “It can serve

plant down the road might alleviate commu-

as a back-up solution for sites with fluctuating

nal dependency on a conventional infrastruc-

renewable energy input such as solar and

ture, the demands of industrial manufactur-

wind power or remote locations not easily

ing and other production plants like breweries,

connected to larger grids.” During the MGT-

paper plants, food processing plants and agri-

series development phase, MAN engineers in-

cultural green house production facilities

vested much time and effort in a particularly

necessitate a continuous, reliable and high-

clean combustion rate. The MGT6000 series

volume power supply to operate efficiently —

designed for both electricity generation as

including heating and cooling processes.

well as a mechanical drive for compressors and pumps reaches single-digit NOx values in

Many cOMpanies turn to MAN to explore

load levels of between 50 and 100 percent -

independent power-sourcing options. SolVin,

impressively proving that the new gas turbine

a leading European producer of PVC resins

is not just highly efficient, but also an envi-

and joint venture of plastics company Solvay

ronmentally conscious power producer.

and chemicals company BASF, was the first

With natural gas resources most likely se-

MDT customer to install and start up a two-

cured for decades, even coal traditionalists

shaft MGT6200 gas turbine at its production

such as China power producers are moving

facility in Rheinberg, Germany. Linked to a

toward cleaner fuels, global demand for gas

generator and equipped with state-of-the-art

turbine-powered energy generation is grow-

technical instrumentation, the compact and

ing steadily and successful product introduc-

highly efficient unit features six megawatts

tions such as a 50-hertz version for SolVin

of electrical and another 11 megawatts of ther-

serve to further strengthen the market posi-

mal performance and has since — together

tion of MAN Diesel & Turbo. “We are currently

with the already installed units from MDT —

developing a version for 60-hertz power grids

rendered the Solvay facility almost complete-

like those in the US and in Latin America,” re-

ly independent in terms of electrical power

ports Wiers. “We might supply off-the-shelf

needs. “With this eminently efficient gas tur-

systems, but also work with our customers to

bine, we have added another component to

tailor solutions according to technical condi-

our combined heat and power concept at our

tions and individual power requirements.

production site,” surmises Richard Rösler,

Thus, we are just as flexible as our turbines.”

“Our gas turbines can be deployed anywhere for decentralized power generation.” Sven-Hendrik Wiers, Vice President Gas Turbines, MAN Diesel & Turbo

80 %

utilizatiOn

rate of natural gas results in outstanding economic efficiency and 7,000 tons less CO2 emissions per year.

31


man magazine

Boom or bub Dr. Stopford, the global shipping fleet

tinue. Ship owner capacity peaked at 160 mil-

continues to grow. Is the market overheated?

lion tons in 2011, driven by high freight rates.

Dr. Stopford: There was talk of a bubble in

This was no doubt a bubble influenced by the

2013 when ship orders reached $129 billion —

very profitable period in the 2000s, when

42% more than the previous year, and the

owners earned more than $100,000 per day

highest rate since 2008. This despite a long re-

with some ships. Since 2011, the shipbuilding

cession, caused by the excesses of the 2000s

industry has cut about a third of its capacity,

while the current spending spree shows characteristics of a bubble, it is not unusual in shipping cycles. It is also fed by investment in fuel-efficient ships as a response to International Maritime Organization emission rules, as well as highly competitive new ship prices and accessible credit for construction. In the light of this situation, what must shipping companies take account of? Ship owners typically buy when the market is slow and prices are good. It takes two to three years for delivery and they hope the market will have improved by then. Those keeping a

“Those keeping a close look on balance sheets, and not ordering too much, will emerge as lean players after the cycle.” Dr. Martin Stopford, President of Clarksons Research, London, UK.

close look on the balance sheets, and not or-

32

but that reduction isn’t enough. If owners keep buying ships, rebalancing supply and demand will take a long time. Why are the order books of shipyards still bulging? It is an attractive time to buy. The most important factor behind the current buying spree is probably the banking sector, which has not been keen to foreclose on ship owners. Without the distressed sales seen in previous recessions, owners have kept prices of second-hand vessels high, encouraging the purchase of new ships rather than pre-utilized ones. And, with all the shipyard capacity in Asia, it is easier to get credit from one of the

dering too much, will emerge as lean players

take these risks, as ships are available when

after the cycle, ready to make a profit. This is

needed. The cycle is one of booms and busts:

just market economics. Historically, ship

When freight rates rise, owners buy more ves-

for a boom period or rather a recession?

owners made some of their most rewarding

sels. Increased capacity and declining rates

I don’t think the industry will flat-line. We

investments at a time when ordering hardly

force ship owners to cut their fleets.

will see some mini booms. Still, considering

credit providers based in Korea or China. From your point of view, are we headed

made sense. Shipping investors must take

So where are we heading? Apparently,

the combination of shipyard over-capacity,

risks to win, but it is almost impossible to tell

this cyclical development is not unusual …

pressure to invest in fuel-efficient ships, easy

whether there will be a depression in three

Indeed, it isn’t: There have been 23 shipping

shipbuilding credit as well as a backlog of sur-

years or another great Asian boom. So it’s

cycle booms and busts since 1741, all for very

plus, it will take a few years to return to a

good for the world economy that ship owners

different reasons. I think this cycle will con-

more balanced market.

Photos: gallerystock(2)

and followed by the 2008 financial crisis. Yet


1/2015

ble?

Shipping rates have gone up by just 25% since 2008, yet the world fleet has increased by 50%, with shipping companies still on a shopping spree. Dr. Martin Stopford, President of Clarksons Research, and Lex Nijsen, Head of Marine Medium Speed at MAN Diesel & Turbo, offer their expert opinions on what this trend is all about.

Mr. Nijsen, addressing the same issue:

fisheries to completely renew their fleets. How would you assess the situation of

Is the market actually experiencing a boom or rather a bubble?

the container industry?

Lex Nijsen: Wondering whether the shipping

The container market is uneven. Smaller con-

industry is heading for a boom or bubble re-

tainer feeders and tankers operating in the

ally depends on individual applications. This

northwest Baltic area and the Mediterranean,

is a highly diversified industry, with many

for example, have been harder hit by the glob-

smaller owners serving different markets, so

al economic slowdown than Southeast Asian

a bubble in one area won’t be overheating the entire global market. So the shipping market does not render a unified appearance. Where is the current demand coming from? Our order books, which offer an indication of where markets are heading, indicate mixed trends. While the container market has shrunk in the face of a struggling global economy, other markets are booming. Among

“This is a highly diversified industry, with many smaller owners serving different markets.” Lex Nijsen, Head of Marine Medium Speed at MAN Diesel & Turbo, Augsburg, Germany

markets. As for the current overcapacity of cargo ships, we might see some degree of speculation in lieu of future market growth. This is a normal part of the shipping cycle, and ship owners are generally experienced in judging the market. Also, some capacity has been absorbed through slow steaming. Speaking of Asia: China’s economy growth has been slowing down. Must ship yards fear a crisis?

MAN’s largest markets nowadays are special-

As the world’s top shipbuilder, China now

ized vessels such as cruise ships, LNG tankers,

constructs not only for exports, but also

governmental vessels and ferries – not con-

ferry accident in South Korea, raises demand

local demand. And the nation is diversifying

tainer feeders. Let’s take a closer look: The lei-

for state-of-the-art ferries.

into specialized and high-value market seg-

sure ship industry is thriving, as cruising be-

Are environmental aspects also an issue?

ments, such as dredgers for port and con-

comes ever more popular – especially among

Yes, these are also a factor. Investing in clean-

struction. I don’t forecast a slow-down here

baby boomers now retiring with generous lei-

er technologies also spurs growth. New emis-

and also expect the current boom in energy

sure funds. At the same time, political ten-

sion regulations issued by the International

transport to last for a while, as China and

sions in Southeast Asia have actually created

Maritime Organization have spurred a great-

Japan increasingly switch from coal and

a demand for patrol vessels to protect borders,

er demand for our optimized propulsion sys-

nuclear energy to gas.

fishing waters, and marine gas and oil re-

tems. I think we will see changes in the fish-

So you remain optimistic?

serves. With developing economies opening

ing industry, where there has been little in-

Yes. Overall, I don’t believe that the ship-

up to tourism, the ferry market is also grow-

vestment. Upcoming environmental regu-

ping industry is heading for a double-dip

ing. And every catastrophe, like the tragic 2014

lations and the economies of scale will force

recession. I am an optimist by nature.

33


man magazine

Power for gibraltar 2014 ended on a HigH note for MAN Diesel & Turbo. An important contract for the supply and installation of six gas and dual fuel engines to operate a new base load power plant in Gibraltar was signed shortly before Christmas. “This is a significant projSteam generated by the heat expands in the steam turbine and drives the electrical generator.

British waste conversion

ect for us,” says Howard Barnes, Global Head of Sales for the Power Plant Business. “The Government of Gibraltar was looking for reliable generation capacities with a low carbon footprint. The chosen combination of gas and dual fuel grants both: The plant benefits from low CO2 emissions when run on natural gas and yet offers full fuel flexibility via the three dual fuel engines.” By mid-2017, three 14V51/60G and three

WHen contracted to build the waste-to-

14V51/60DF engines will supply electrical energy to the British Overseas Territory. The

energy plant “Wilton 11” in England, the Paris-

new plant will replace several existing but dated diesel engine plants, which also run

based CNIM industrial solutions group

on MDT aggregates. The French engineering, procurement and construction contrac-

brought MAN Diesel & Turbo on board. The

tor Bouygues Energies & Services SAS will build the plant.

state-of-the-art plant will supply northeast England with resource-friendly energy, reduc-

Rising high above the Strait of Gibraltar, the famous rock looks down on a bustling economy.

ing carbon emissions while at the same time redirecting 90% of the area’s garbage away from landfills. Wilton 11 will generate energy by incinerating 60 metric tons of waste per hour. MAN Diesel & Turbo will supply not only the steam turbine, but also the generator, condenser, lube-oil system and the complete instrumentation and control technology. CNIM’s environmental operations division has often worked with MAN Diesel & Turbo before. “MAN has brought a comprehensive, technical competence to our project and is a partner that we know we can rely on,” comments Olivier Serres, Steam Turbine & Condenser Purchaser at CNIM.

34

green pass for Petrofac man diesel & turBo has won the con-

atures of up to 400°C and thus achieving a

tract to provide Selective Catalytic Reduc-

chemical reaction. MAN engines already

tion (SCR) systems for each of six MAN

comply with Tier II of the International

16V32/44CR engines ordered last year for

Maritime Organization’s emission rules.

the global oil and gas services provider

MDT and Petrofac have also entered a

Petrofac. The engines will be installed in

12-year service contract for the manage-

the Petrofac JSD 6000 deepwater derrick

ment, maintenance and monitoring of the

lay vessel scheduled for delivery in 2016.

engines. “We are delighted to work with an

SRC reduces the emission of polluting

industry leader on the design and build of

nitrogen oxide (NOx) by up to 80% by

the vessel’s key components,” says Yves

injecting urea into exhaust gases, passing

Inbona, Managing Director of Petrofac’s

it through a catalytic converter at temper-

Offshore Capital Projects business.

Photos: MAN(2), gettyimages

Adding SCR systems raises compliance with new Tier III emission rules.


1/2015

Facts & Figures the velocities reached by the turning parts of turbomachinery are staggering. Taking a closer look at MAN Diesel & Turbo’s steam turbines reveals that the fastest tip speed of an end stage runs up to …

257 1760 kph Proud heritage

years! that’s how far back MAN’s roots reach. On October 18, 1758, the first blast furnace was fired up at St.-Antony-Hütte, the oldest iron works in Germany’s industrial Ruhr region. Ever since then, MAN has been committed to the company philosophy “Engineering the Future,” with a focus on the key technologies transport and energy.

That pace amounts to Mach 1.5, the typical cruising speed of a Eurofighter jet.

69,720 kW

1.5 million cubic meters per hour …

Illustrations: MAN, shutterstock, fotolia

… is the amount of air that the largest axial flow compressor from MAN Diesel & Turbo can suck in. At this capacity rate, the entire air volume of the Cologne Cathedral could be exhausted in merely 16 minutes.

is the output of the world’s largest engine, a low-speed MAN B&W 12S90ME-C Mark 9.2 type. It powers the “CSCL Globe,” which became the hitherto largest container ship in the world when first launched in November 2014. This engine performance corresponds to the output of 78 Bugatti Veyron Super Sports, the fastest street-legal production car.

= 116,000 euro donation for hospital ship MaN Diesel & turbo donated spare parts and services valued at €116,000 in order to keep the engines on board the hospital ship Africa Mercy in top condition. The ship is now bound for Madagascar, where it will remain until June 2015, providing medical assistance.

20%

more energy is now available to Burkina Faso since the expansion of the power plant near Bobo-Dioulasso. Each of the two expansions, “Bobo II” and “Bobo III,” has two MAN 12V48/60 engines, increasing the capacity of each expansion plant by 24 MWh.

35


Here it is – the brand new MAN 175 D. A high-performance marine engine, robust and reliable by nature. Ay folks, just like ol’ Tugboat Joe!

Welcome to the future of high speed marine mobility. Find out more: www.175D.man.eu

MANmagazine Power 01-2015  

With this first issue of MANmagazine by MAN Diesel & Turbo, we invite you to explore our universe of versatile technology. Join us on a worl...

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