Maersk reveals new 'dual-fuel methanol ship' as part of decarbonization initiative.

• A.P. Møller, a 350-meter-long ship, is part of a growing fleet of Maersk vessels that can operate on both methanol and traditional marine fuels.
• Maersk claims that ships powered by green methanol can reduce CO2 emissions by 280 tons per day, contributing to the company's objective of achieving net-zero emissions by 2040.

Denmark-based shipping and logistics giant unveiled its latest dual-fuel methanol vessel in Southeast Asia on Thursday, as the industry ramps up decarbonization efforts.

A.P. Møller, a 350-meter-long ship, is part of a growing fleet of Maersk vessels that can operate on both methanol and traditional marine fuels.

Ditlev Blicher, the Asia-Pacific president of Maersk, stated on CNBC's "Squawk Box Asia" that the vessels represent the latest technology that is ready to reduce carbon emissions in shipping.

The technology enables the industry to transition from black fuels to green methanol, significantly reducing carbon emissions in shipping.

Fuels that reduce greenhouse gas emissions by at least 65% on a lifecycle basis compared to fossil fuels are considered green fuels by Maersk.

Methanol can be produced from sustainable, renewable-based energy sources, in addition to being largely produced from fossil fuels, according to the International Renewable Energy Agency.

Maersk claims that utilizing green methanol in ships can reduce CO2 emissions by approximately 280 tons per day, contributing to the company's objective of achieving net-zero emissions by 2040.

The World Economic Forum states that green methanol has a lower sulfur content, resulting in reduced emissions of sulfur oxides, which contribute to air pollution and acid rain.

Maersk's ninth dual-fuel vessel, A.P. Møller, is one of 25 planned to be completed by 2027, according to Blicher.

The company claims that replacing 12 of its regular vessels with those powered by green methanol could reduce CO2 emissions by 1.5 million metric tons, which is almost twice the amount of CO2 emitted by the Municipality of Copenhagen in 2022.

The future of shipping?

With its status as the largest maritime shipper globally, Maersk sets the pace for global trade in methanol adoption, inspiring other companies to follow suit.

The entire industry has placed orders for approximately 170 dual-fuel methanol vessels, as stated by Blicher, which is contributing to the growth of scale.

Blicher stated that Maersk, the industry, and clients are driving forward and investing in technology, with clients increasingly focused on meeting their own decarbonization goals.

To shift the industry away from black fuels, he believes that more will be needed than just building economies of scale, as methanol presents higher production costs.

This tipping of the scales is expected to result from regulations that discourage the use of black fuels, according to Blicher.

He stated that we need to increase the cost of black fuel to ensure that its price accurately reflects its impact on the economy.

The world's largest bunkering port, Singapore, has taken the lead in promoting sustainable shipping through various initiatives.

In the third quarter, Maersk reported strong results, with heavy demand and higher prices resulting from disruptions in the Red Sea. As a result, the company raised its full-year forecasts, and its revenue increased to $15.8 billion from $12.1 billion the previous year.