INTERVIEW: Japan's MOL targets Southeast Asia for FSRU market growth: exec

Japan's shipping company Mitsui O.S.K. Lines sees Southeast Asia as an important focus market for floating storage and regasification units, Hideyuki Irisawa, an executive officer at the company, told Platts, part of S&P Global Energy, in an exclusive interview on April 30.

Irisawa is an executive officer of Mitsui O.S.K. Lines. He is also secondary responsible for the Southeast Asia and Oceania Region (Business) and deputy managing director of MOL (Asia Oceania) Pte Ltd.

"The FSRU business represents a priority area for MOL as part of our broader LNG infrastructure strategy," Irisawa said. "We see Southeast Asia as an important focus market, and within the region, Malaysia and Vietnam in particular offer strong potential, given their growing demand for flexible LNG import solutions."

"MOL is in a unique position in the shipping industry as it owns FSRUs," Irisawa said. "MOL has already accumulated operational experience through the deployment and management of multiple FSRUs. This track record is a key strength for us and enables us to differentiate ourselves from shipping companies that lack hands-on involvement across the LNG value chain."

MOL started commercial operations of the Jawa Satu FSRU for the Jawa 1 LNG-fired power plant in Indonesia in March 2024, according to its press release.

In October 2024, MOL announced that the company had agreed with Singapore LNG Corp. on a long-term time charter contract for one newbuilding FSRU. The FSRU is expected to start operation in 2029, Irisawa said.

"Traditional shipping segments such as dry bulk and tankers are inherently exposed to market volatility. By combining these businesses with relatively stable, project-based activities such as FSRUs, we aim to enhance the overall resilience and earnings stability of our portfolio," he added.

LNG transition fuel pathway

MOL considers LNG bunker as a bridge fuel, not a long-term solution.

"At present, LNG should be viewed as a transitional solution for marine fuel rather than a final decarbonization endpoint," Irisawa said.

"Over the longer term, other zero and near-zero emission fuels -- including ammonia -- could emerge as one of the main options, depending on fuel availability, regulatory alignment and the maturity of supply chains," he added.

The LNG bunker industry has been experiencing growth in global demand to reduce greenhouse gas emissions, especially after the implementation of the EU Emissions Trading System and FuelEU Maritime.

"While LNG bunkering supply is expected to expand, our strategic focus is not on bunkering as a standalone activity. Instead, we are looking to participate across the broader value chain, encompassing fuel sourcing, logistics and infrastructure, in a manner that supports both operational reliability and long-term decarbonization goals," Irisawa said.

Bio LNG

Although MOL considers LNG bunker as a tentative solution, Irisawa said bio-LNG is one of the areas MOL is watching closely as an opportunity.

"We see strong potential in Malaysia and other parts of Asia for bio-related energy, including bio-LNG, as regional supply chains continue to develop," Irisawa said.

"If such fuels -- together with other forms of bioenergy -- can be secured at competitive and scalable prices, we would like to procure a certain volume as a regional initiative and supply it as bunker fuel for MOL's commercial vessels. Beyond securing cleaner energy, we also view this as an opportunity to progressively adapt and strengthen our fleet in line with evolving customer and regulatory expectations," he added.

LNG carrier market outlook

The shipping industry observed that LNG carrier deliveries are likely to decline in 2029 and 2030. However, LNG demand is expected to continue growing even after 2029. There is a concern that LNG ship supply might tighten, according to shipping industry sources.

"LNG carrier supply is influenced by newbuilding ordering trends. Given that vessels typically require several years from order placement to delivery, shifts in ordering activity can result in periods of tighter market conditions," Irisawa said.