August 27, 2025
The shipping industry is under growing pressure to decarbonise. Among the many alternatives – biofuels, e-fuels, methanol, and ammonia – one stands out for its immediacy and compatibility with existing LNG infrastructure: liquid biomethane (LBM), also known as Bio-LNG, according to the UK P&I Club.
In a recent article on the Club’s website, Ansuman Ghosh, Director of Engineering, shared insights from a detailed discussion with Yiyong He, Founder and Director of Straits Bio LNG. The focus was on Bio-LNG, a carbon-negative fuel produced from Southeast Asia’s abundant palm oil mill waste.
As explained, Straits Bio LNG procures or produces compressed biomethane (CBM) sourcing from liquid and solid waste palm oil production, naming palm oil mill effluent (POME), empty fruit bunch (EFB) or even oil palm trunk (OPT) into carbon-negative bunker fuel. Southeast Asia has vast reserves of this feedstock, much of it left uncovered in open ponds, releasing large volumes of methane into the atmosphere. At the same time, LNG-fuelled ships are looking for greener fuel options, but until recently there was no link between these two opportunities.
At the same time, Transport & Environment (T&E) has raised concerns in a recent briefing over the use of Palm Oil Mill Effluents (POME) in EU biofuels, pointing to risks of fraud and inconsistencies in reported volumes—issues that underscore the complexity of scaling waste-based alternatives.
However, sourcing and processing Bio-LNG come with different challenges than fossil LNG. Natural gas fields deliver consistent supply, but biogas is a waste stream, meaning feedstock ownership and quality can vary. In some developing countries the owners of the feedstock are smallholders or farmers who can be difficult to deal with. ”Fortunately, palm oil milling industry in Malaysia is a well organised corporate business centred around long term contracts, where the interest of the feedstock owner and the biogas or CBM developer are aligned . That lessens the burden compared to managing other feedstocks in developing countries.”Yiyong explained.
Compared to other alternative fuels, Bio-LNG offers fewer challenges. Biomethanol is much more expensive, green ammonia faces safety and scale issues, while e-methanol, e-LNG, and liquefied green hydrogen all struggle with high renewable power demands, logistical barriers, or poor efficiency.
Straits Bio LNG ensures credibility by using independent auditors (e.g., Bureau Veritas) to certify its waste-to-liquefaction supply chain. Demand already exceeds supply, driving expansion plans. Unlike the EU’s “mass-balanced” model, Straits uses 100% physical liquefied biomethane (LBM).
Pricing is expected at about 2.5 times fossil LNG – more competitive than biomethanol – with a preference for long-term (10+ years) contracts. Operationally, Bio-LNG directly substitutes fossil LNG in marine engines, requiring no modifications to vessels and enabling a smooth transition while preserving performance.
From an industry standpoint, Bio-LNG uniquely combines scalability, readiness for deployment, and meaningful emissions reduction. For shipowners, it offers a realistic route to achieving IMO 2030 and 2050 goals, without the disruption of shifting to entirely new fuel systems.
Concluding Yiyong explained that the technology and the market are already available. ”The technology and market are already in place. We need to catch the train. In the race to decarbonise shipping, that train is leaving the station and Bio-LNG may well be one of the fastest, most practical tickets on-board.”
