MSEA Capital

POWERED

METHANOL

powered by Inside Marine

Shipping

powered by methanol

Cyprus-based MSEA Capital has 10 years’ experience managing and operating a fleet of 21 vessels, alongside shipping, commercial and operation management, plus asset and investment management.

Founder and CEO Modi Mano shared his experiences with methanol fuel and the possibilities it brings to the shipping industry in discussion with Phil Nicholls.

MSEA Capital is leading the tran sition to decarbonise the shipping industry with major investments in alternative fuels, via the acquisition of Marinvest Group in Sweden and the incor poration of Clean Sea Transport in part nership with Arkview Capital. MSEA’s Clean Sea fleet includes five dual-fuel methanol carriers on long-term charter to a joint ven ture partner, Waterfront Shipping Limited, a subsidiary of Methanex Corporation, plus four LR1 ice class 1A long-range product tankers.

“Methanol is a fuel that could take us towards that net zero target in 2050,” explained MSEA founder Modi Mano. “With the necessary evolution, obviously, from grey methanol, through blue methanol and eventually to green methanol, this fuel offers a pathway to net zero.”

MSEA Capital was founded by Mr Mano in 2012 and quickly built up a sizeable fleet, primarily within the tanker sector.

As interest in shipping decarbonisation grew, MSEA partnered with Arkview Capital to buy the Swedish Marinvest Group in 2021 Marinvest was founded in 1988 by Lars Mossberg, an innovator in the shipping sector who developed and managed one of the world’s first methanol-powered commercial vessels. Mr Mossberg vali dated methanol as a clean, safe and future proof marine fuel capable of meeting the industry’s increasingly stringent emis sions standards.

The shipping industry is in a period of transition and MSEA has nailed its colours to the methanol mast:

“At MSEA, we knew we needed to be part of this decarbonisation process,” Mr Mano said, “so we looked for an interesting alternative fuel to use. LNG was already popular, but we were drawn to methanol since it’s a liquid fuel at ambient temper ature. Methanol is not as complicated as gas from this perspective.”

Turnover at MSEA for 2022 is projected to be $400 million, with $300 million invested in the group as equity and $600 million in assets under management. MSEA man ages 21 vessels with a carrying capacity of 1 million tonnes.

This fleet is composed of a mix of medium-range eco-design and conven tional chemical and product tankers, ice class 1A tankers, long-range product tankers and Aframax tankers. The centre piece of the MSEA fleet is the Clean Sea vessels, each ship proudly bearing the phrase ‘powered by methanol’ on her hull.

Agile services

Alongside its fleet operation, MSEA also offers a range of services including ship ping, commercial and operation manage ment. It provides asset and investment management services to shipping invest ment platforms for reputable institutional and private clients. These investment

Modi Mano, CEO

MSEA CAPITAL I PROFILE

management services are supplied pri marily by MSEA Capital Management (Jersey), while the commercial manage ment, operations and technical oversight are provided by MSEA Management Limited. To deliver its assorted services, MSEA operates from offices in Cyprus, Mumbai, The Hague and Gothenburg.

“We operate out of Cyprus for accounting, team operations and legal compliance,” Mr Mano explained. “MSEA recently opened an office in The Hague in the Netherlands where the CFO is based, plus we have an office in Mumbai, home to our Chief Technical Officer who supervises the technical and admin teams over there. Finally, there is the Gothenburg office in Sweden for the methanol team.”

Mr Mano sees MSEA as a very agile company, capable of great flexibility when it comes to the decision-making process. The company’s shift to alternative fuels demonstrated this dynamism.

“From the time we identified our desire to be part of the decarbonisation process, we quickly recognised methanol as an interesting opportunity,” he said. “It was then a very short time before we executed that transaction. MSEA is a very flat organisation making quick decisions.”

Clean Sea partnership

Decisive action by MSEA led to the cre ation of the Clean Sea Transport joint venture with Arkview Capital. This minority-certified private equity fund is focused on investing in diversity-oriented businesses. Arkview was the ideal partner for the Clean Sea project, according to Mr Mano: “As an equity partner, Arkview Capital is different, taking a truly longterm view.

“This business requires a long-term approach: Arkview’s philosophy is about building businesses, which reaps dividends over time. With a concerted ESG focus on both the social and environmental front, Arkview is an excellent match for MSEA.”

Ultimately, the goal of the Clean Sea project is to achieve net zero for MSEA’s methanol-powered fleet and beyond.

Pavel Chernyshov, founder of Arkview Capital, commented: “With only a fraction of the ocean-going fleet using clean fuels today, we believe our investment in clean sea transport will significantly reduce the emissions footprint of the shipping industry and key customers.”

“Our investments will get us to net zero sooner rather than later,” continued Mr Mano, “but the transition is going to be gradual. The whole process needs to work economically, net zero requires massive investments, in technology and infras tructure. Everything needs to be pack aged in a way that offers decent returns to investors, so everyone can continue doing business in a proper way.”

MSEA is already on the journey to reach t he goal of sustainability. This is most apparent in the Clean Sea project where additional measures support the com pany’s major investment in the transition to alternative fuels. The dual-fuel vessels in the fleet operate innovative third-gener ation methanol powered engines. These propulsion systems have been optimised on the back of over 50,000 engine running hours on methanol and a learning curve commencing with Marinvest’s first methanol powered engine design in 2014.

The Clean Sea vessels also deploy sev eral cutting-edge energy-saving features including a propeller boss cap fin to

enhance propeller efficiency, the Spee d / Fuel Pilot keeping consumption at an optimum level, and frequency-controlled pumps. These ships are also fitted with a power factor compensator for the alter nators, enabling substantially greater energy savings.

Clean Sea Transport owns those ves sels in a joint venture with Waterfront Shipping, a subsidiary of Methanex Corporation. Waterfront Shipping oper ates the world’s largest methanol ocean tanker fleet, comprising vessels from 3,000 to 50,000 deadweight tonnes. Its fleet of 30 modern, deep- sea tankers forms a seamless transportation network dedicated to keeping an uninterrupted flow of methanol moving to storage ter minals and customers’ plant sites around the world.

Future challenge

Experience managing the Clean Sea fleet of dual-fuel vessels has convinced Mr Mano that methanol, as a marine fuel, will have a key role in shipping’s clean transition: “At the moment, CO2 is around a 15% reduc tion on the basis of grey methanol, but this will e ventually go down to a full reduction when we have the green methanol in large volumes. In the interim, there’s going to be a phasing in of blue methanol.

“The thing we like about methanol is how it all uses the same engine tech nology, meaning we can shift between the different methanol types and the engine doesn’t need any adjustment. So why not burn green methanol today? Because it’s just not available in the industrial vol umes shipping needs, but it’s going to get there. Eventually, clean forms of methanol will be commercially and widely available;

MSEA

The team at MSEA are committed to delivering excellent support to clients, bolstering these relationships which have built up over many years. Senior manage ment at MSEA are always in easy reach for customers, ready to resolve issues as they arise. This dedication to service has

landed MSEA with charters lasting up to 15 years, a clear endorsement of its treat ment of clients.

MSEA sails onward into the future, proudly powered by methanol and ready to meet the next challenge.

“There’s always something happening in shipping,” concluded Mr Mano. “This is what we love about the industry. It might

be the regulations, cargoes, geopolitics or the cyclical volatility of the market.

“We need to develop, we need to be cre ative, and this gives MSEA the opportunity to do new things. We love finding a solution to an industry challenge, whether it’s on the financial side or the decarbonisation of ship ping. I believe that solving a problem is just as creative as a piece of art.” n

will take part in promoting and facilitating that process.”