Liquefied Petroleum Gas (LPG) – What is it?

LPG, an exceptional energy

Liquefied Petroleum Gas (LPG) is a versatile, cleaner, and efficient energy source that is used for cooking, heating, as an automotive fuel, as well as an industrial energy solution. Comprising primarily propane and butane, LPG is produced from the extraction of natural gas and oil refining. LPG is stored and transported in liquid form under pressure in cylinders or tanks, making it an accessible energy source for a wide range of applications.

LPG’s popularity stems from its reduced environmental impacts, high calorific value, and portability. It emits fewer pollutants compared to coal and oil, contributing to reduced greenhouse gas emissions and air quality improvement. Being a cleaner energy alternative makes LPG a key player in the global transition towards a low carbon future. More information about the charter of benefits of this exceptional energy is available from the World Liquid Gas Association.

Ship to Ship Transfer or STS of LPG bunker and coolant at sea

LPG Value Chain

The largest consumer of LPG globally is the retail market at about 200 million metric tons per annum. Around 60% of the total consumption of LPG is represented by its use for transport, heating or cooking by end-users such as individuals or businesses. The remaining consumption is absorbed by large bulk applications such as the petrochemical industry or small bulk applications for industrial use. At BW LPG, we deliver LPG to world markets with a fleet of 46 LPG carriers, 17 of which are powered by LPG dual-fuel propulsion technology. From spot voyages and time charters to Contracts of Affreightment (CoAs), our emphasis on safe, flexible, and reliable service has earned the trust of leading oil companies as well as trading and utility companies. Our touch points within the value chain typically include export terminals (linked to upstream pipelines and storage facilities) and import terminals (linked to downstream storage and transportation). These vessels are also used in large-scale maritime storage projects — often acting as floating terminals. We are also expanding into downstream terminal infrastructure.  Read about our trading arm, BW Product Services; and about our expanding business presence in India.

BW LPG, LPG Value Chain

LPG as Marine Fuel

As the world’s largest owner and operator of VLGCs, BW LPG leverages our scale and deep expertise in maritime shipping to invest in R&D and implement pioneering technology. In 2020, BW LPG announced the redelivery of the world’s first Very Large Gas Carrier (VLGC) to be retrofitted with LPG dual-fuel propulsion technology. Over the next two years, we retrofitted 15 of our VLGCs with the technology at an investment of USD120 million. 

Explaining the Technology

LPG deck tanks are filled together with the LPG cargo tanks using the cargo system during loading. LPG is then drawn from the deck tanks into a fuel gas supply system and piped to the engine.A small amount of compliant pilot fuel, such as diesel, is injected into the engine as the piston nears the top. It sparks under pressure, and LPG burns to create propulsive force. 

The Benefits of LPG propulsion

  • Environmental Efficiencies

    With LPG propulsion, BW LPG will reduce its Sulphur Oxide emissions by up to 97 percent, allowing for full compliance with all current and future Sulphur emissions requirements. This means the retrofitted ships, when operating on LPG, will go beyond IMO’s global 0.5% Sulphur emissions cap to also be in full compliance with Emission Control Areas (ECA) and Sulphur Emission Control Areas’ (SECA) 0.1% Sulphur cap. In addition, with LPG fuel, BW LPG will reduce emissions of particulate matters by ~90 percent, and carbon dioxide and nitrogen oxides by ~20 percent. 

  • Operational Efficiencies

    LPG as a marine fuel offers efficiency gains on many fronts. Output efficiencies will improve by ~11 percent with LPG when compared with compliant fuels. This means that we capture significant improvements in total voyage fuel economics. Other efficiencies include easy storage, faster refueling and wide availability of bunkering ships and facilities. Bunkering can be done directly at load terminal or via ship-to-ship transfer from smaller LPG carriers. With LPG, we eliminate bunker quality issues and spill risks. LPG deck tanks above deck are connected to the cargo system, and these tanks can receive condensate from cargo. These tanks can also be used to store additional LPG cargo.  

  • Economic Efficiencies

    LPG as a marine fuel is also future-proof and cost-efficient. In addition to savings from reduced fuel consumption, we are buffered from price sensitivity with full dual fuel flexibility. Even at today’s pricing, LPG is advantageous compared to heavy fuel oil, offering high life-time saving prospects.

LPG in the global energy mix

Transforming global energy systems, especially in fast-developing economies, can be challenging. In alignment with the decisions made at the 28th Conference of the Parties (COP28) which recognises that transitional fuels can play a role in facilitating a just, orderly, and equitable energy transition, LPG as a cleaner burning fuel can help ensure energy security as communities accelerate climate action and mitigation measures.  BW LPG is well-positioned to uplift communities and capture market opportunities. The decarbonisation momentum in shipping remains strong — from biofuels and green ammonia ventures, to ammonia and methanol propelled vessels, they signal that shipping companies are translating words into action. The direction is clear, even if the pace is not.  The role of LPG should be considered within a broader strategy that includes the adoption of renewable energy technologies, energy efficiency measures, and a transition to low-carbon and zero-emission fuel alternatives.

BW LPG is playing its part to ensure that the energy needs of the present are met as we find solutions for tomorrow. Our presence across the LPG value chain, encompassing trading, shipping, and shore terminal infrastructure, allows us to create value for shareholders and stakeholders. At BW LPG, we are taking concrete steps to reduce our environmental emissions, accelerate our R&D into new propulsion and ship technology, and ensure we have a corporate strategy that is in tune with the shifting energy landscape. Above all, we want to build a sustainable and profitable business that will endure. 

BW LPG logo

About BW LPG

BW LPG is the world’s leading owner and operator of LPG vessels, owning and operating Very Large Gas Carriers (VLGC) with a total carrying capacity of over 3 million CBM. With five decades of operating experience in LPG shipping, experienced employees and an in-house LPG trading division, BW LPG offers an integrated, flexible, and reliable service to customers.

BW LPG is associated with BW Group, a leading global maritime company involved in shipping, floating infrastructure, deepwater oil & gas production, and new sustainable technologies. Founded in 1955 by Sir YK Pao, BW controls a fleet of over 490 vessels transporting oil, gas and dry commodities, with its 200 LNG and LPG ships constituting the largest gas fleet in the world. In the renewables space, the group has investments in solar, wind, batteries, biofuels and water treatment.


Read More

  • See our fleet  list here.
  • Read our 2023 Integrated Annual Report here.
  • Read about LPG propulsion here.