Shipping Industry Navigates Future Fuel Choices: Methanol vs. Ammonia in Dual-Fuel Engines

The shipping industry is closely monitoring the choices being made for dual-fuel engines in newbuildings, as it reflects the uncertainty surrounding future fuel options. According to DNV’s Alternative Fuels Insights platform, there are currently 27 ammonia and 322 methanol-fueled vessels on the orderbooks. Methanol has taken the lead over ammonia in terms of engine and regulatory development. With 2025 already here and 2030 quickly approaching, attention is now shifting to the existing fleet and the potential for engine retrofits.

Methanol is currently ahead of ammonia in terms of retrofits, with high-profile conversions like the Maersk Halifax to a dual-fuel methanol vessel leading the way. Companies like Hapag-Lloyd and Seaspan Corporation have also announced plans to retrofit container ships to dual-fuel methanol. Caterpillar Marine is offering upgrade kits for its methanol-fueled engines, citing methanol’s diesel-like properties and ease of modification as favorable for small ships like tugs.

Despite methanol’s progress, ammonia remains attractive for its carbon-free potential and zero-emission capabilities when produced from renewable hydrogen. Companies like NYK, MOL, Berg Bulk, and MISC have chosen ammonia as a fuel option. The world’s first ship-to-ship transfer of ammonia took place in September 2024, marking a significant step towards realizing ammonia as a shipping fuel. Orders for ammonia-fueled marine engines are expected to surge as the industry gains more experience. Lloyd’s Register predicts a 50% growth in ammonia-fueled vessel orders in 2025.

The competition between methanol, ammonia, and LNG for market share continues, with LNG currently leading the race. Clean fuels like green methanol and ammonia are not yet available at scale, leading to a shift back to LNG as a fuel choice. The uncertainty surrounding the future fuel landscape makes it challenging to predict which fuel will dominate. LNG is seen as a transitional fuel, with its availability likely to extend well into the future. 

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