Maersk has signed its first green methanol deal in a bid to drop fossil fuel use in its shipping operations with a target to operate its first carbon-neutral ship by 2023.

The deal was made with REintegrate, a subsidiary of the Danish renewable energy company European Energy. 

In a statement, Maersk said REintegrate and European Energy will establish a new Danish facility to produce the approx. 10.000 tonnes of carbon neutral e-methanol that Maersk’s first vessel with the ability to operate on green e-methanol will consume annually.

Maersk will also work closely with REintegrate and European Energy on the development of the facility. 

“This type of partnership could become a blueprint for how to scale green fuel production through collaboration with partners across the industry ecosystem, and it will provide us with valuable experiences as we are progressing on our journey to decarbonise our customers’ supply chains,” said Henriette Hallberg Thygesen, CEO of Fleet & Strategic Brands, A.P. Moller - Maersk. 

Thygesen added that sourcing the fuels of the future is a significant challenge.

“We need to be able to scale production in time,” Thygesen went on. “This agreement with European Energy/REintegrate brings us on track to deliver on our ambition to have the world’s first container vessel operated on carbon neutral methanol on the water by 2023.” 

The methanol facility will use renewable energy and biogenic CO₂ to produce the e-methanol. The fuel production is expected to start in 2023. 

Maersk said the energy needed for the power-to-methanol production will be provided by a solar farm in Kassø, Southern Denmark.   

“We’re proud to be a part of the first large scale e-methanol production in Denmark. While renewable energy is becoming more and more common in the energy mix of electricity consumption, this is one of the first steps in heavy transportation towards using 100% renewable energy. This agreement marks a milestone in the journey towards green transition in the shipping industry,” said Knud Erik Andersen, CEO, European Energy.

While the renewable energy will be produced in Southern Jutland it is yet to be decided where in Denmark the power-to-methanol facility will be located.  

Maersk said the dual fuel vessel, an industry first, in February 2021. In June, it added that Hyundai Mipo Dockyards will be building the 2100 TEU (Twenty Foot Equivalent) feeder. 

The world’s first methanol feeder will be 172 metres long and it is expected to join the Maersk fleet in mid-2023. It will sail in the network of Sealand Europe, a Maersk subsidiary, on the Baltic shipping route between Northern Europe and the Bay of Bothnia. It will fly the Danish flag.

With about 90% of world trade transported by sea, global shipping accounts for nearly 3% of the world's CO2 emissions.