Tata Steel first Indian firm to use LNG powered Capesize carrier for raw material

Tata Steel became the first Indian company to use clean fuel Liquified Natural Gas (LNG) powered Capesize carriers for its raw material movement from Australia to India, the company said on Friday.

Tata Steel claimed that carbon emission for this voyage was around 35 per cent less compared to traditional Baltic specification cape vessels. Image Source: Reuters

Tata Steel became the first Indian company to use clean fuel Liquified Natural Gas (LNG) powered Capesize carriers for its raw material movement from Australia to India, the company said on Friday.

In an initiative to lower the company's Scope 3 carbon footprint, the steel major imported 1,65,700 metric tons of coal from Australia's Gladstone to Dhamra port in Odisha using MV Ubuntu Unity, a cape vessel powered by clean fuel LNG.

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'Capesize' is the largest class of cargo ship. They are called so as they cannot pass through the Panama Canal and have to go around the Cape of Good Hope to sail between the Pacific and Atlantic oceans.

"In 2021, Tata Steel became the first in the Indian Steel Industry to deploy a ship powered by biofuel. We continued the decarbonation drive with seven biofuel shipments in FY23. In continuation to our sustainability drive, in FY24, we are the first to deploy an LNG powered vessel for transportation of raw materials to India," said Peeyush Gupta, the company's Vice President, Group Strategic Procurement and Supply Chain.

LNG is cleaner compared to heavy fuel oil used in bulk ships.

Tata Steel claimed that carbon emission for this voyage was around 35 per cent less compared to traditional Baltic specification cape vessels.

The company plans to import nearly one million tons of coking coal in FY24 from Australia in such LNG powered vessels.

"With innovation and participation of all the partners, in FY24, we endeavour to perform 10 per cent of our total number of shipments for imports through alternate fuel powered vessels," Gupta said.

Tata Steel is also the first steel producer in the world to join the Sea Cargo Charter (SCC) to align its chartering activities with responsible environmental behaviour, consistent with the policies and ambitions of the International Maritime Organisation, the company claimed.

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