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Shipper Mitsui OSK to invest $1.8bn in decarbonization over 3 years

LNG-fueled tankers feature in plan to reach net zero emissions by 2050

Mitsui O.S.K. Lines plans to invest in LNG-fueled ships to reduce its carbon footprint. (Photo courtesy of Mitsui O.S.K. Lines)

TOKYO -- Japanese maritime shipping company Mitsui O.S.K. Lines will invest 200 billion yen ($1.8 billion) in fields related to cutting carbon dioxide emissions over the three years through fiscal 2023, according to a business plan released Monday.

The latest version of the annually revised three-year plan sets a goal of achieving net zero emissions by 2050 -- a significant step up from the target of "within this century" in the fiscal 2020 edition -- reflecting a global pivot away from fossil fuels that has spread to this carbon-heavy industry.

As part of this strategy, Mitsui O.S.K. will introduce ships powered by liquefied natural gas, with a focus on large vessels such as car carriers and crude oil tankers. While the company did not provide details on how much of its fleet will be fueled by LNG, it is expected to gradually switch over about 30% to 40% of its ships over the next 10 years.

"LNG looks almost certain to be the leading next-generation fuel of the 2020s" amid the decarbonization trend, company President Takeshi Hashimoto said in a virtual news conference.

But LNG-powered vessels reduce greenhouse gas emissions by only about 30% compared with conventional ships that use heavy fuel oil, meaning that other steps will be necessary to achieve net zero emissions.

"We will also need to switch to new alternative fuels such as hydrogen and ammonia," Hashimoto said.

The three-year plan also calls for taking advantage of the shift away from carbon by investing in wind power, including offshore wind, along with LNG.

Mitsui O.S.K. is the first major Japanese marine shipper to aim for net zero emissions by 2050, though A.P. Moller-Maersk, the world's largest container shipping company, announced such a target in 2018.

Mitsui O.S.K. projects pretax profit for the fiscal year ended March 31 more than doubling to 120 billion yen, outstripping its previous forecast of 95 billion yen. The jump owes mainly to an unexpectedly strong showing by affiliate Ocean Network Express, the container shipping joint venture that Mitsui O.S.K. formed with Nippon Yusen and Kawasaki Kisen.

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