Project Management

Assignment 1- Project Investigation

The assignment research was carried out as a group work; however, the article is written
individually investigating the project from a Shipowner perspective.
Research Work: Venkatesh Natarajan (Student ID: 230716) & Valdrin Sehu (ID: 230730)
Individual Work: Venkatesh Natarajan (Student ID: 2301716)

Project Investigation:
Rotor sails project for Maersk Tankers Long Range 2 (LR2) product tanker vessel (Pelican)
1. Summary:
 Shipping and Decarbonization:

The background and objective (or the scope of research) for the chosen project narrows down to
one subject – “how CO2 emissions can be reduced from ships using innovative technologies”.

The reduction of CO2 from ships is of greater interest because of its global impacts and shown to be
significant enough to motivate action plans. “Around 6% of the global CO 2 emissions are emitted
from ships”[ CITATION ICC18 \l 1033 ]. CO2 is a direct access to climate forcing’s which leads the
world to dangerous conditions like the melting of ice caps in the arctic. The results of ice melting
paves ways to several other impacts such as rising sea levels, threatening low lying areas, influencing
food production, accelerating global warming, impact on weather patterns, affecting native people,
wildlife and plants all results at the end as a crisis on human survival.

Shipping has always considered being an indispensable ally for adopting technologies that are
available in the land-based market. The major difficulty faced for adopting such systems is “how they
could be modified/ engineered to get installed over ships” in where ‘Innovation takes place’.
[ CITATION Oli18 \l 1033 ]

The chosen project displays and proves that CO2 could be reduced from ships by adopting innovative
technologies.

In recent times, few technologies were proposed for cutting down CO2 from ships such as battery
propulsion, sail-kites, wind power, solar power, air lubrication, using hydrogen as fuel etc. However,
a specific project was carried out by Maersk to one of their tanker ships installing ‘ Rotor Sails’
utilizing wind power for reducing CO2 emission. Maersk collaborated with a Finnish start-up
company that specializes in Rotor Sails for ships as a project for one of its tanker fleet vessels
(Maersk Pelican).
 Project Management
Assignment 1- Project Investigation

This paper will be investigating the complete project starting from its partnerships, initial phase to
completion, various stages involved, strategies used, difficulties faced, and results obtained. A short
gist about the technology and project scope is explained below before diving into further
investigation.

 Rotor sails

Rotor sails utilises wind power and are designed to use Magnus Effect for propulsion. “The Magnus
Effect is a force acting on a spinning body in a moving airstream, which produces a force
perpendicular to both the direction of the airstream and the axis of the rotor. The German
engineer Anton Flettner was the first to build a ship which attempted to use the Magnus effect for
propulsion” [ CITATION Wik \l 1033 ].

 NORSEPOWER – The company that re-innovated ‘Flettner Rotor’

Norsepower was founded in 2012 with a mission to reduce the environmental impact of shipping
through its Rotor Sail Solution technology. The company has raised 20M USD to facilitate
development, piloting and commercialisation of the innovative Rotor Sail Solution. [ CITATION Nor \l
1033 ]

‘Norsepower Rotor Sails provide a reliable and easy-to-operate auxiliary wind propulsion system with
a proven savings record. Norsepower Rotor Sails can typically produce 5-20% fuel savings’.
[ CITATION Nor \l 1033 ]

Using the rotor sails ships can be able to save fuel, if lesser fuel burnt the amount of CO2 emitted
from ships exhaust is thus reduced. [ CITATION ICC18 \l 1033 ]

 Maersk’s sustainability goals towards decarbonization

According to Maersk’s sustainability report, the main objective or mission is to contribute and
achieve the UN Sustainable Development Goals. Out of the UN 17 SDG’s, Maersk’s statement
towards carbon emissions is ‘Decarbonize our own operations and decouple growth in business
from CO2 emissions’.

The company also stated in the report ‘The need for partnership’ through which Maersk believes a
better solution can be found faster by building alliances with competitors, customers, suppliers,
knowledge institutions and the public sector. [ CITATION Mae191 \l 1033 ]
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Assignment 1- Project Investigation

2. Introduction
 Partnership for achieving decarbonization

In order to achieve the above stated mission in their sustainability report, Maersk initiated a pilot
project by collaborating Maersk Tankers, Norsepower, ETI (The Energy Technologies Institute) and
shell to test wind propulsion technology in 2017.

The project was aimed to install rotor sails on one of the tanker vessels ‘Maersk Pelican’ and testing
it for a year to see the achievable results. The initial published report by Maersk in 2017, stated that
the project will be the first installation of wind-powered energy technology on tanker vessel.
[ CITATION Tom19 \l 1033 ]

For product credibility and customization, Maersk decided to install the rotor sails in tanker ships
due to size, economic and stability reasons. The project was carried out with ‘Maersk Pelican’ a
109,647-deadweight tonne (DWT) Long Range 2 (LR2) product tanker vessel which was retrofitted
with two 30m tall by 5m diameter Norsepower rotor sails.

The project is majority funded by the UK’s Energy Technologies Institute (ETI) with contributions
from Maersk Tankers and Norsepower. Shell was collaborated to act as project coordinator and
provide operational and terminal / port consultancy to the project team, while Maersk Tankers will
provide technical and operational insight.[ CITATION Oli18 \l 1033 ]

Although the overall structured budget for the project could not be found, one report assumingly
stated that the cost associated installing a Norespower’s rotor sails could be between 1 and 2 million
euros. [ CITATION Oli18 \l 1033 ]. Comparing with the present scrubber market price, the authors
assumption for such a project for a tanker ship could cost at a range of 2 to 3 million euros (including
installation, offloading, commissioning etc.). However, an ETI report states the overall budget
including research, collaboration, coordination and project completion estimated an investment of
3.5m £[ CITATION ETI19 \l 1033 ]. Exact figure of the associated costs unfortunately could not be
found.

3. Description
 Initiation of the project

Following the research outcome of the collaboration, planning phase for the installation of the rotor
sails on the tanker vessel started in 2017. However due to nature of the shipping business, vessel
running around the clock throughout the globe, installation of the two rotor sails extended for quite
a period.

According to one of the reports, the installation was finally completed at port of Rotterdam
somewhere between August 2018. The completed project was set to be tested through the vessels
scheduled geographic locations operating in conditions ranging from tropical climate to arctic
conditions in Europe, Middle East, Asia and Australia. [ CITATION CNB18 \l 1033 ]
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Assignment 1- Project Investigation
 Challenges Faced

Testing a land-based manufactured product is simple when compared to testing an innovative

product installed on-board a ship due to the nature of the business and vessel operation.
Considering facts like data capture, commissioning, terminal allowance, port permission, rough
weather etc. constitutes factors that must be analysed for testing an on-board system.

To combat such challenges, shell acted as project coordinator, and provided operational and
terminal/ port consultancy to the project team, while Maersk Tankers provided technical and
operational insight.
Together with such collaboration testing of the project was carried out for a whole year starting
from 1 September 2018 to 1 September 2019.[ CITATION Off18 \l 1033 ]

 Testing of the project

Although the equipment could be full land tested and approved, specific requirements had to be
met to get the system approved on-board ships considering major factors like stability, risks
involved, safety of the ship and crew etc. Not only to fulfil the mentioned but also testing of
mechanical and performance criteria, measurement, evaluation of the effectiveness of the system
must be compromised by an IACS member. Only then a system or technology can be class approved
and could enter the commercial world of the shipping sector. Even though it is not mandatory to do
such, it is indispensable in the maritime world to involve IACS.
Independent experts from Lloyd’s Register’s (LR’s) Ship Performance Group have been employed to
analyse and validate the performance data during the project to ensure an impartial assessment.
According to sources an LR expert stated that “The crew and operators reported positively on the
usability, safety and performance of the Rotor Sails in all conditions. Wind power technologies
are  part of the solution, and the Norsepower Rotor Sail has proven itself to save fuel and reduce
emissions”[ CITATION Mik19 \l 1033 ].
The project was commissioned by ETI and stated “Auxiliary wind propulsion is one of the few fuel-
saving technologies that is expected to offer double-digit percentage improvements. The technology
is projected to be particularly suitable for tankers and dry bulk carriers, and this test will assist in
determining the further potential for Rotor Sails in the product tanker industry.”[ CITATION ETI19 \l
1033 ]

 Outcome of the project

The sea trial of the project was projected for one year from 1 September 2018- 1 September 2019,
sailing the ship across continents and different weather conditions. The outcome of the testing
resulted in saving fuel an aggregated amount of 8.2 % [ CITATION Mae19 \l 1033 ].

Norsepower projected the project could be able to save 7-10% for the whole year and have resulted
with a median of 8.2% according to the reports. Norsepower simulation models show that in optimal
conditions, its Rotor Sails can save around 12 percent on fuel and emissions.

The savings were confirmed by comparing detailed performance information to a baseline

established with full-scale measurements and computational analysis done by Lloyd’s register
experts in the project testing phase. Also validating the saved 8.2% of fuel is equivalent to 1,400
tonnes of CO2. [ CITATION Mik19 \l 1033 ]
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Assignment 1- Project Investigation

4. Analysis or Comparison of the project with course topics

This section explains the analysis or comparison of the project with the course modules that were
taught and augments the synchronization of the course topics.

Basis on the reports and sources, the project is compared with four topics or procedures from the
PMBOK guidelines for project management including lecture sessions. Further, discussing the
author’s assumptions over the management of the project and the course area. The four topics
include:

 Project Integration Management

 Project Organization
 Scope, Time & Cost and
 Risk Management

Project Integration Management:

The key points / processes highlighted in the lecture notes and referenced in PMBOK for analysing
the points to the presented project are Project Charter, Project Plan, Monitor & Control Work.

Based on the articles and sources used as references for investigating the project, the author
assumes that Maersk had very well managed the project using the above points of integration
management.

In one of the article[ CITATION Off18 \l 1033 ] it is mentioned that the rotor sails was installed in
August 2018, however the initiation phase of the project started in 2017.

So, by this we could assume that during a year / at least 6 months prior to the installation of the
rotor sails Maersk has carried out the project charter with Norsepower and has integrated
organizing: the design, requirements, project plan, developing strategies for collaborations,
formulating the scope, cost and time of the complete project and creating frameworks for managing
the risk involved well in advance before the installation began.

Project Organization

The key terms / roles highlighted in the lecture notes and referenced in PMBOK for analysing the
points to the presented project are Project Governance, Management, Control and Coordination.
Also, to include that the framework contains supervision who takes responsibility/leadership in the
project.

Comparing the above terms to the project, according to the sources the author assumes that Maersk
had developed clear strategies programming collaborations with internal and external stakeholders
to successfully complete the project.
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Assignment 1- Project Investigation
Maersk assigned the company’s CTO (Chief Technology Officer) as an internal stakeholder to take
leadership and governance over the project and involving external stakeholders like Charterers to
manage the voyage customization of the project (as vessels involve round the clock trading, strategic
scheduling to install the rotor sails is necessary), involving Classification Society such as Lloyd’s
Register is to manage the testing, efficiency and performance control of the project.

As the project is an innovative step towards Maersk’s sustainability goals proper research and real-
time implementation is carried out by employing another external stakeholder ETI clearly marks the
company’s organizational strategy and importance of the project.

As communication and coordination are considered as key specifics for implementing the project,
involvement of Shell for this specific purpose makes it a clear strategy to act as project coordinator
and providing operational and technical/ port consultancy to the project team. As the rotor sails are
installed to one of the fleet vessels, Maersk’s supports the project with technical and operational
insight.

Scope, Time and Cost

The key characters highlighted in the lecture notes and referenced in PMBOK for analysing the
points to the presented project are Scope of the project, Execution strategy, Consumable Time and
Cost Estimate.

The scope of the project stands in one goal ‘to achieve Maersk’s sustainable mission’ and ‘need for
partnership to fulfil/support the mission’. The author could see that both the scope of targets by
Maersk were successful. A step to reduce CO2 from ships is considered as a milestone to achieve
one of the UN goals, further Maersk has combined hands not only with the rotor sail manufacturer
Norsepower but also involving other stakeholders like Shell, ETI & Lloyd’s Register as part of the
project to go extra-mile making the concept of ‘Wind Energy’ possible for the maritime industry.

As the project is an innovative step towards decarbonization, time schedule for installation and
testing of the product on-board is a required step as a phase for the project. Although the complete
timeframe for installation could not be found, the rotor sails were tested for a period of one year.
Through the one year testing period stakeholders participation, support and coordination was
substantial in author’s view as it is not simple to test such innovative concept without help of proper
coordination of port calls, permit to enter a country or specific port / canal, thorough research of the
concept and monitoring the performance and risks involved.

The execution strategy is well planned and is communicated properly framing ‘which stakeholder’
needs to perform the specific task and ’who is responsible’ for the allocated role. Maersk’s ideology
by employing its CTO to manage the technical and operational support, further involving external
stakeholders for project coordination, communication and research for conducting the project could
be linked with the lecture thought ‘execution strategy’.

Regarding to cost as stated earlier in the report, no structured cost could be found however the
overall cost of 1-2 million euros which could involve both ‘Indirect costs and Overhead costs’ linking
the lecture slides and PMBOK.

The indirect costs within the budget could involve construction facilities (laying the vessel in yard
and using cranes to lift and installing the rotor sails), supervision (engaging Lloyd’s Register for
monitoring performance and testing of the product). The overhead costs within the budget could
 Project Management
Assignment 1- Project Investigation
involve competence building (providing training for the crew on-board to handle such installation),
company management (collaborating with Shell and LR) and RDI (Research, Development,
Innovations) collaborating with ETI for research and innovations the project could bring to the
company as the company could use the achievement for marketing and sales gaining high reputation
in a competitive industry.

As the project was successful and completed within the timeframe stated by the sources/reports, it
is to assume that the allocated budget was properly controlled by the management of the
organization.

Risk Management

The key content highlighted in the lecture notes and referenced in PMBOK for analysing the points
to the presented project are Risk and Contingency management.

The first thing that rise to any concerned is “Safety” when it comes to install such an innovative
product on-board a ship. Modifying such technologies over ships is not an easy fact, a number of
measures and factors needs to be raised before setting one. The major difficulties that could be
faced in authors view are safety (vessel, environment and crew safety), governance and
maintenance (type of maintenance required by the crew for successful operation), equipment utility
& retrofitting (utilization of other ship board equipment’s), acceptability (by international
organizations and charterers), space constraint (without affecting the cargo capacity), durability in
ships movement (able to withstand stress and vessel’s movement in harsh weather conditions).

However, in one of the article Maersk CTO stated that “Maersk Tankers and the industry have
developed and tested a number of technological solutions, which contribute to reducing fuel
consumption and associated emissions. We see wind technology as one of the technologies that can
give us a real breakthrough in reducing CO2” [ CITATION Mal19 \l 1033 ].

The above statement by the CTO clearly makes to understand that the probability of the risks
involved could be measured well in advance before starting the project and marking the risk ‘low’
with the accidents and lessons learned from similar projects which was carried/tested earlier by the
company.

In addition, a source report mentions that “During the one-year trial period on Maersk Pelican, crew
and operators have reported positively on the usability, safety and performance of the Rotor Sails in
all conditions” [ CITATION Mik19 \l 1033 ]. Proving ‘Risk and Contingency’ management was well
carried out.

5. Conclusion

The project was a successful milestone for Maersk’s initiative and mission towards the company’s
‘sustainability goal towards decarbonization’. In addition, achieving the company’s mentioned
mission on ‘need for partnership’ involving Norsepower. Proving the project saved 1400 tonnes of
CO2 over a one-year testing period.

Following the successful implementation of the project and proven results, Maersk’s CTO reports
that “The product could help us achieve our emission-reduction target of 30% by 2021. We will
closely follow the development around the financial and commercial viability of the technology for
 Project Management
Assignment 1- Project Investigation
potential future installations on some of our other larger vessels, while we have decided
that Maersk Pelican will continue to sail with the Rotor Sails .” [ CITATION Mae19 \l 1033 ]

The achievement not only made business for the manufacturer Norsepower but also attained ‘the
first-ever type approval design certificate’ to a wind propulsion system from DNV GL. [ CITATION
Mik19 \l 1033 ]

The paper investigated the project on installation of rotor sails specifically designed and
manufactured for Maersk Pelican Tanker vessel. Topics of the project such as initiation, challenges
faced, strategies developed, and results obtained were also discussed. Further, analysis of the
project synchronizing with the course topics were framed in detail with author’s viewpoint.

6. References

CNBC. (2018). Maersk Tankers has installed two huge rotor sails on one of its vessels. CNBC.

Energy, O. (2018). Rotor Sails Fitted on board Maersk’s Tanker in a World’s 1st. Offshore Energy.

ETI. (2019). Flettner rotor sails - Phase 3. London, UK.

ICCT. (2018). Reducing GHG from ships. ICCT.

IMarEST's. (2019). Maersk Pelican project confirms major rotor sail fuel savings. London: Marine
professional.

Jallal, C. (2019). Rotor sails go mainstream with equipment manufacturer collaboration. Riviera .

Latarche, M. (2019). Rotor Sails meet expectations on Maersk Pelican. ShipInsight.

Norsepower. (n.d.). Story-Norsepower. Retrieved from Norsepower.com:

https://www.norsepower.com/tanker

PMBOK. (2017). A guide to the project management body of knowledge (PMBOK guide).
Pennsylvania, USA: Project Management Institute.

Schuler, M. (2019). Norsepower Confirms Rotor Sails Fuel Savings. Gcaptain.

Smith, O. (2018). Norsepower: Why European Ships Are Switching Back To Sails. Copenhagen:
Forbes.

Tankers, M. (2017, 2018, 2019). Sustainability Report. Copenhagen: Maersk Tankers.

Tankers, M. (2019). Norsepower Rotor Sails confirmed savings of 8.2% fuel and CO2 in Maersk
Pelican project. Copenhagen: Maersk.

Washington, T. (2019). Maersk, Shell, Norsepower, ETI announce wind-powered tanker project.
London: S&P Global Platts.

Wikipedia. (n.d.). Wikipedia-Rotor sails. Retrieved from Google:

https://en.wikipedia.org/wiki/Rotor_ship
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Assignment 1- Project Investigation