The “bunker”, which is the main consumable for ships, is Fuel Oil obtained by the distillation of crude oil. Crude oil contains sulfur, which causes harmful emissions after combustion in ship machinery. Sulfur oxides (SOx) are extremely harmful to human health. It is known to cause respiratory distress symptoms and lung diseases. SOx in the atmosphere contributes to acid rain that can harm all living creatures, crops, forests, all kinds of water basins, as well as those living in these waters, without minding wild or modern.

In general, limiting SOx emissions caused by the use of fossil fuels will increase the air quality in the atmosphere and protect living things and the environment.

IMO regulations to reduce sulfur oxide (SOx) emissions from ships first came into force in 2005 under Annex VI of the International Convention for the Prevention of Pollution from Ships (known as the MARPOL Convention). Since then, the limitations on sulfur oxides are getting stricter.

Simply put, limiting sulfur oxide emissions from ships reduces air pollution and provides a cleaner living environment. The reduction of SOx also helps to reduce the small harmful particles that are generated when fuel is burned.

IMO monitors the sulfur content of fuel used in ships globally. The latest figures show that the annual average sulfur content of residual fuel oils tested in 2017 was 2.54%. In 2017, the worldwide average sulfur content for distillate fuel was 0.08%.

Since 1 January 2015, the sulfur limit for Fuel Oil used by ships operating in the Emission Control Areas (ECA) designated by IMO for the control of sulfur oxides (SOX) has been 0.10% m / m. ECAs for SOx created under MARPOL Annex VI are: Baltic Sea region; North Sea region; North America region (includes designated coastal areas other than the United States and Canada); and the United States Caribbean Sea region (waters around Puerto Rico and the US Virgin Islands).

Since 1 January 2015, the sulfur limit for Fuel Oil used by ships operating in the Emission Control Areas (ECA) designated by IMO for the control of sulfur oxides (SOX) has been 0.10% m / m. ECAs for SOx created under MARPOL Annex VI are: the Baltic Sea area; the North Sea area; the North American area (covering designated coastal areas off the United States and Canada); and the United States Caribbean Sea area (waters around Puerto Rico and the United States Virgin Islands).

The time IMO adopted regulations to control air pollution

from ships

IMO has been working to reduce harmful impacts of shipping
on the environment since the 1960s. Annex VI to the International Convention
for the Prevention of Pollution from Ships (MARPOL Convention) was adopted in 1997, to address air pollution from shipping. The regulations for the
Prevention of Air Pollution from Ships (Annex VI) seek to control airborne
emissions from ships (sulphur oxides (SOx), nitrogen oxides (NOx), ozone
depleting substances (ODS), volatile organic compounds (VOC) and shipboard incineration) and their contribution to local and global air pollution, human health issues and environmental problems. Annex VI entered into force on 19 May 2005 and a revised Annex VI with significantly strengthened requirements was adopted in October 2008.

These regulations entered into force on 1 July 2010. The regulations to reduce sulphur oxide emissions introduced a global limit for sulphur content of ships’ fuel oil, with tighter restrictions in designated emission control areas. Since 2010, further amendments to Annex VI have been adopted, including amendments to introduce further Emission Control Areas.

Energy efficiency requirements entered into force in 2013.

IMO 2020

Until 31 December 2019, for ships operating outside Emission Control Areas, the limit for sulphur content of ships’ fuel oil is 3.50% m/m (mass by mass). The 0.50% m/m limit will apply on and after 1 January 2020.

The date of January 1, 2020 is set in the regulations adopted in 2008. However, a provision was adopted requiring the IMO to review the availability of low sulfur fuel oil for use by ships to help Member States determine whether the new lower global limit exists. IMO’s Marine Environment Protection Committee (MEPC 70), in October 2016, decided that the 0.50% limit shall apply from 1 January 2020.

What does the new limit mean for ships?

Under the new sulphur limit, ships will have to use fuel oil on board with a sulphur content of no more than 0.50% m/m, against the current limit of 3.50%, which has been in effect since 1 January 2012. The interpretation of “fuel oil used on board” includes use in main and auxiliary engines and boilers. Exemptions are granted in cases involving the safety of the ship, or saving lives at sea, or if a ship or its equipment is damaged. Another exemption allows a ship to experiment with the development of ship emission reduction and control technologies and machine design programs. This requires a special permit from the Flag State of interest.

How can ships meet lower sulfur emission standards?

Ships may have got engines able to burn different fuels that contain low or zero sulfur that meet the requirement of consuming low sulfur compliant fuel. For example, liquefied natural gas or biofuels.

An increasing number of ships are also using gas as a fuel as when ignited it leads to negligible sulphur oxide emissions. This has been recognised in the development by IMO of the International Code for Ships using Gases and other Low Flashpoint Fuels (the IGF Code), which was adopted in 2015. Another alternative fuel is methanol which is being used on some short sea services. 3 Ships may also meet the SOx emission requirements by using approved equivalent methods, such as exhaust gas cleaning systems or “scrubbers”, which “clean” the emissions before they are released into the atmosphere. In this case, the equivalent arrangement must be approved by the ship’s Administration (the flag State).

IMO has adopted a MARPOL amendment to prohibit the transport of non-compliant fuel for propulsion or combustion on board a ship unless an exhaust gas cleaning system (“scrubber”) is installed on board.

Controlling the discipline

Implementation is the duty and responsibility of the Administrations (flag States and port / coastal States). Ensuring that the 2020 0.50% m / m sulfur limit is implemented consistently and effectively is a high priority. Ships must be issued an International Air Pollution Prevention (IAPP) Certificate from Flag States.

This certificate includes a section stating that the ship is using fuel oil with sulfur content not exceeding the applicable limit value documented on bunker delivery note or using an approved equivalent regulation. They could also use surveillance, for example air surveillance to assess smoke plumes, and other techniques to identify potential violations.

If the rules are not respected, sanctions are determined by individual parties of MARPOL as flag and port states. IMO does not set sanction penalties, its sanctions are up to each State Party.

What is IMO doing to ensure proper fuel availability?

Implementation is the responsibility of the Member States who are contracting Parties to MARPOL Annex VI. The decision by MEPC in October 2016 to affirm the effective date of 1 January 2020 (more than three years before entry into effect of the 0.50% limit) is intended, in part, to provide sufficient time for Member States and industry to prepare for the new requirement, Regulation 18 of MARPOL Annex VI covers both fuel oil availability and quality. As regards the availability of fuel, the regulation requires that each Party “take all reasonable steps to promote the availability of fuels conforming to this Annex and inform the Organization of the availability of compatible fuels at its ports and terminals.

Parties are also required to inform IMO when a ship provides evidence that suitable fuel is not available. IMO Global Integrated Transport Information System (GISIS) urged the Organization to inform the Organization about the availability of compatible fuels at its ports and terminals well before January 1, 2020 through the MARPOL Annex VI module. MARPOL Annex VI Rule 18.1.

Why are ships less harmful than other modes of transport?

Ships emit pollutants and other harmful emissions. But they also transport large quantities of vital goods across the world’s oceans, and trade by sea continues to increase. According to UNCTAD, in 2016, ships traded over 10 billion tons for the first time.

Therefore, ships have always been the most sustainable way to transport goods. Ships are getting more and more energy efficient. IMO regulations on energy efficiency are updating themselves to support the demand for greener and cleaner transport than ever before. A ship that is more energy efficient burns less fuel and causes less air pollution.

In some articles it is cited that only a few large ships emit much more harmful air pollutants than all cars in the world.

However, this worst case scenario does not take into account the amount of cargo carried by the ships and the relative efficiency. It is important to consider the amount of cargo transported and the emissions per tonne of cargo transported per kilometer traveled. Studies have shown that ships are the most energy efficient mode of transport compared to other methods such as aviation, road trucks, and even railways.

On the other hand, it is also important to remember that shipping is responding to the demands of large volumes of world trade. As the world trade volume increases, more ship capacity will be needed.

Ships are the largest engines on the planet, and almost the largest diesel engines in the world are found on cargo ships. These machines have over 100,000 horsepower, compared to a mid-size car around 300 horsepower. Large container ships can transport more than 20,000 containers, and bulk carriers can transport more than 300,000 tons of goods such as iron ore. Very powerful engines are needed to float ships of this size. It is important to calculate how much energy is used to transport every ton of cargo per kilometer. When you look at the relative energy efficiency of different modes of transport, ships are the most energy efficient. Ships therefore burn less fuel, are more energy efficient, less air pollutants, and their emissions are lower.

Can low sulfur fuels cause problems for ship engines?

All Fuel Oil intended for combustion on a ship must meet the required fuel oil quality standards as specified in IMO MARPOL Annex VI (regulation 18.3). For example, fuel oil must not contain any additives or chemical waste that endanger the safety of ships or adversely affect the performance of the engine.

IMO discusses how to identify potential safety issues related to fuel mixes. It is recognized that if these fuels are not properly managed, compatibility and stability issues can occur. If necessary, additional guidance can be developed for crew and ship operators.

The International Organization for Standardization (ISO) standard (ISO 8217) determines and circulates maximum and minimum international standards for fuels used in diesel marine engines and boilers.

A study commissioned by IMO for the “assessment of fuel availability” concluded that the refinery sector has the capacity to supply a sufficient amount of marine fuels with a sulfur content of 0.50% m / m or less and a sulfur content of 0.10 m.

Do small ships also have to comply with the sulfur limit?

Yes they do, MARPOL rules apply to all ships. Vessels of 400 gross tons and over sailing to ports or offshore terminals under the jurisdiction of other countries must have an International Air Pollution Prevention Certificate issued by the ship’s Flag State. However, ships of all sizes must use fuel oil that meets the 0.50% limit as of January 1, 2020.

Some smaller ships may be using a suitable marine distillate for their engines. Like the small vessels operating in predetermined emission control areas may use fuel oil that meets the 0.10% limit in these emission control areas for instance.

IMO 2020 Update: The Impact We See So Far (Agust 2020)

Now that the deadline for January 1 has come and gone, we wanted to share an update on the real-world implications of IMO’s mandate.

With steamship lines beginning to purchase low-sulfur fuel in early November 2019, there was definitely an increase in fuel surcharges. There were many speculative fears that fuel wages would double or triple, but that is currently not the case.

In the first quarter of the year, the dry cargo market suffered from the financial burden brought by IMO 2020. Since the charter rates are inversely proportional to the maximum 0.5% sulfur marine fuel prices in important bunkering ports, the increased fuel costs after IMO 2020 were not reflected in the freight rates. Charter rates for ships (T / C time charter $ / day) rose in direct proportion to VLSFO prices and / but freight gains fell.

In fact, there were no stable inrease in T / C ratios as well, temporary fluctuations were experienced. As the fuel price rose, it was seen that shipowners had to lower the daily charter rates of their ships to keep their voyage rates constant. However, over time, freight and T / C rates settle in direct proportion.

The availability of products, that will have to be used as the day-by-day approaches 2020, the refineries’ ability to produce these products, and the rhetoric that these fuels will be too expensive and even that most ships may supposed to consume MGO, all have affected the chemistry of the maritime industry. However, with this pessimistic state of mind, while a stable balance is not expected to be established in a short time, VLSFO prices have started to decrease rapidly. For example, between January 6 and January 17, the price of 0.5 percent sulfur-containing marine fuel (VLSFO) supplied to ships at the port of Singapore fell from $ 740.00 / mt to $ 645 / mt, down 12 percent. Fuel supplying sources have confused the fuel demanders and the maritime market in general with alternative practices. Equilibrium could not be mentioned in such a climate. It was surely unfair forcing the buyers get alarmed and causing them to buy fuel in a panic due to fuel shortage. However, it should not be too strange to experience these negativities, as these are known behaviors and attitudes displayed in transition periods.

This wind blew hard for a while. Some rushed without looking at the price, in order not to have a nightmare of not finding out the fuel, no matter expensive or not, while others expected the prices to drop to reasonable levels as soon as the panic calms down, till the prices settle at a new balance. Because, the managerial risks that the decision mechanisms will face and the scandals they will create within the institution come before losing money in some cases.

It’s time to take a look at the chart below before continuing to discuss the impact of IMO 2020 on the industry!

It is good to take a look at the status of two important international oil criteria since November 2019. Brent crude oil and US West Texas Intermediate (WTI) crude oil turned upside down. Nevertheless, the fearful prediction has not come true, the price of fuel also plumped.  Unfortunately, this has not happened with a cooperation, contribution, ingenuity or victory of any industry.

While the world’s leading oil producers, exporters, importers, consumer countries bullied each other with the geopolitical advantages granted by the world at the end of 2019 and early 2020, while the endless conflicts of various superiority and interests of the muscular world countries continue, a health monster that says I am coming in the last quarter of 2019 It affected the realm. As of March 2020, the coronavirus pandemic Covid-19 has become a nightmare for people breathing. People quickly infected each other, filled hospitals, many people got sick, there were deaths. The remedy was that human interaction should be minimized and social distance rules must be followed. Travels between countries were stopped, businesses were closed, people were advised to stay at their homes. Even mandatory retrictions were
applied. After all these measures, the lockdowns were gradually eased in summer 2020, but Covit-19 is still active.

The returns from the last quarter of 2019 till so far, which we have summarized roughly, have not been surprising. It was known, lived and continues to be experienced. IMO 2020 is the product of an industry awareness. We have brutally betrayed our world. IMO 2020 set out with strict rules to fulfill its duty. And he succeeded in that.

The crashes that came with Covid-19 proved how much harm the emissions caused to all living things in the world. In the process, data on pollution in the atmosphere dropped tremendously. Locks increase again as they are eased.

These deadlocks have dropped global oil demand. The leading oil producers, exporters, and importers of the world, which have fallen into each other, have suddenly entered into a friendly, cooperative, attitude and attitude to increase demand.

So lessons had to be learned!

Covid-19 and demand concerns remain, crude oil and distillate prices are still falling. IMO 2020 has reached its goals, it is no longer a scapegoat.
Source: bunkerist

The global bunker industry’s smooth transition into the low-sulfur era mandated by the International Maritime Organization has sent a strong signal to the sector that it can achieve its next goal of decarbonization equally free of hurdles, industry sources said.

“The IMO deserves credit as it was a [role] model to implement the regulation on an international basis,” Mitsuyasu Kawaguchi, general manager of crude oil and tanker department at Japanese refiner Cosmo Oil said at the 36th Annual Asia Pacific Petroleum Virtual Conference, or APPEC 2020.

In 2019, there were numerous discussions in the marine industry over how the transition to 0.5% fuels would pan out, with a lot of skepticism around VLSFO availability and VLSFO blends as it was expected they would increase operational problems and quality claims.

“What we’ve heard is that they [VLSFOs] burn better, they are cleaner and overall as long as you don’t have compatibility issues on your ship and are not unfortunate enough to get one of the fuels with sediments or unstable trends, they have been very good fuels,” Unni Einemo, director at International Bunker Industry Association, said at the same event.

Meanwhile, Gard, member of the international group of protection and indemnity clubs, said in a statement on Sept. 10 that the most commonly experienced problems with fuel reported to it were high total sediment potential and marginal exceeding of sulfur while the most common operational problems faced onboard was an increase in sludge formation in purifiers and filters.

However the operational problems have not led to a high frequency of major breakdowns or engine damage cases, it said. “Our data for fuel related machinery damage claims shows that the first six months of 2020 saw fewer claims than the same period in 2018 and 2019.”

“On the defence side, the number of case files opened this year on contractual bunker disputes is similar to previous years. So, from Gard’s perspective, the more dire predictions regarding potential engine damage, and a deluge of litigation between owners and charterers have not materialized, at least in this first six-month period,” it added.

So far this year, among all the samples tested by Lloyd’s Register, only 4% of VLSFO and 1.7% of MGO’s has been off-spec, Douglas Raitt, regional advisory services manager Asia at marine classification society Lloyd’s Register, told Platts earlier in September.

This is lower compared to the same period in the preceding year, Raitt added then.

Another aspect was the timely preparation.

“One of the key challenges was actually the maritime industry accepting that the IMO 2020 is here and rather than giving excuses, [one needs to] start early because it is the right thing to do,” Rajalingam Subramaniam, AET’s President & CEO said at APPEC 2020.

“We started using the LSMGO much earlier than the regulatory day,” he added.
Compliance to IMO 2020

Compliance to the rule has also been fairly good despite the challenges posed by coronavirus, or COVID-19, pandemic, industry sources said.

In the first six months of 2020, the number of port state control, or PSC, inspections dropped by nearly 40% due to the COVID-19 outbreak, Gard said.

“Despite that, detentions relating to SOx [sulfur oxides] regulations of MARPOL Annex VI were in double digits in the Tokyo MoU region, with the majority of those being for high sulfur content in the fuel,” it said.

PSC officers are generally aware of and following the IMO guidelines, Gard added, citing its involvement in some of those cases.

The narrowing HSFO-VLSFO price spread brought about by COVID-19, has also prompted shipowners to use more LSFOs, aiding compliance, some industry sources said.

The huge amount of gasoline demand destruction brought large amounts of vacuum gasoil to the middle distillates pool, easing VLSFO prices, Kawaguchi said.

However, Kawaguchi noted that the spread had likely bottomed out. Some sources also resonated this sentiment as, with the easing of lockdown restrictions in many countries, a recovery was underway.

Decarbonization

Meanwhile, with the IMO greenhouse gases emission cut targets looming, decarbonization has become a focal point for the industry, some sources said.

The IMO, in April 2018, laid out its strategy, aiming to reduce the shipping industry’s total GHG emissions by at least 50% from 2008 levels, by 2050, and to reduce CO2 emissions per transport work by at least 40% by 2030.

Ammonia, hydrogen, LNG were among the various alternatives being discussed by several sources at APPEC 2020 to tide over this regulatory challenge.

AET Tankers, for its part, has already invested in dual-fueled LNG technology although LNG was still a transition fuel, Subramaniam said.

The parent company of AET Tankers — the MISC Group — is also part of a joint development project, or JDP, for an ammonia-fueled tanker to advance shipping’s drive towards decarbonization, he said.

“COVID-19 is a massive reset in the industry, It is like a safety car coming in the F1 [Formula 1] race,” Subramaniam said.

Moving forward, the industry will have to adopt a more collaborative approach to stay relevant, he added.
Source: Platts

At the “Future of Shipping: Decarbonisation” webinar jointly organised by the International Maritime Organization (IMO) and Singapore today, leaders from maritime administrations and industry came together to share insights on decarbonisation for shipping in the new normal post-COVID-19. Over 500 participants from 63 countries tuned in to the webinar.

Speaking at the opening of the webinar, Singapore Minister for Transport, Mr Ong Ye Kung, said, “While the world deals with the COVID-19 crisis, it must keep up with the fight against climate change. No one can do this alone. It is a global ambition, to be accomplished by the international maritime community. But we all have capabilities, expertise, and resources to contribute to this endeavour. Singapore will do our part, and we look forward to the maritime community coming together, under the leadership of the IMO, to redouble our efforts and build a better, greener world.” Please refer to the Annex for his full speech.

IMO Secretary-General Mr Kitack Lim called for more action to speed up research into zero carbon marine fuels. The Secretary-General said, “To achieve this, IMO is stepping up its efforts to act as a global forum and promoter in R&D in zero carbon marine fuels, bringing together interested stakeholders from public and private sectors, and also private and development banks and other potential donors around the world.”

The strong turnout at the webinar demonstrated that decarbonisation remains a key priority for the international shipping community despite the COVID-19 pandemic. An important underlying theme in the webinar was the importance of collaboration and coordination amongst all stakeholders across the energy and maritime transport value chains, to achieve IMO’s ambition of reducing total annual Greenhouse Gas emissions by at least 50% by 2050 compared to 2008.

To co-ordinate and spur global efforts, the IMO and Singapore introduced “NextGEN”, a concept for a collaborative global ecosystem of maritime decarbonisation initiatives. “NextGEN” will facilitate information sharing on decarbonisation initiatives across stakeholders such as IMO Member States, industry and academia, identify opportunities and gaps for decarbonisation in the global shipping ecosystem, and create important networks and platforms for collaboration.

Mr Andreas Sohmen-Pao, Chairman, BW Group and Co-Chair of Singapore’s International Advisory Panel on Maritime Decarbonisation (IAP), Mr Wong Weng Sun, President and CEO of Sembcorp Marine Ltd and Co-Chair of the IAP, and Ms Quah Ley Hoon, Chief Executive of the Maritime and Port Authority of Singapore (MPA) spoke on the approach needed to successfully transition global shipping to future green energy sources and meet IMO’s 2050 target.

The “Future of Shipping: Decarbonisation” webinar is the third webinar under the Maritime Perspectives series organised by MPA. IMO and Singapore will co-organise another webinar – “Future of Shipping: Digitalisation”, on 8 October 2020, where experts will discuss the potential that digitalisation has for shipping. Both webinars lead up to the main IMO-Singapore Future of Shipping conference to be held during Singapore Maritime Week 2021.
Source: Maritime and Port Authority of Singapore

Hyundai Samho Heavy Industries has delivered the world’s first very large containership powered by liquefied natural gas (LNG) to Singapore’s Eastern Pacific Shipping (EPS), the South Korean shipbuilder announced Wednesday.

The LNG-powered, 14,800 twenty-foot equivalent unit (TEU) capacity CMA CGM Tenere is one of six containerships in a series being built for EPS by Hyundai Samho, a unit of shipbuilding giant Korea Shipbuilding & Offshore Engineering Co.

The six neo-Panamax box ships are each powered by dual-fuel MAN B&W 11G90ME-GI main engines capable of running on LNG or traditional diesel bunker fuel.

The 366-meter-long vessels were ordered by EPS in April 2018 and will be delivered by the third quarter of 2022. They will be chartered by French container shipping company CMA CGM.

CMA CGM will soon take delivery of even larger LNG-powered containerships, stating with the 400-meter-long, 23,000-TEU capacity CMA CGM Jacques Saadé from Shanghai Jiangnan-Changxing Shipyard. The Chinese shipyard is building nine vessels in the series for CMA CGM, who aims to operate at least 20 LNG-fueled containerships by 2022.

Increasingly, shipowners in various segments—from bulk carriers to cruise ships—are looking to LNG-powered vessels to meet the International Maritime Organization’s (IMO) environmental regulations that call for ship emissions to be reduced by more than 30% by 2025 from 2008 levels. The IMO rules also target 40% emissions reductions by 2030 and by 70% reductions by 2050.

In addition, the IMO regulations that took effect at the start of this year lowered the sulfur cap on bunker fuel content from 3.5% to 0.5%.

The number of LNG-fueled ships is expected to more than double from less than 400 currently to more than 1,000 by 2030, a senior executive at Malaysia’s Petronas said on Wednesday.

Source: maritimeprofessional

Jabatan Laut Malaysia, known as Marine Department Malaysia, on Monday (11 November) released a shipping notice regarding the implementation of IMO 2020 sulphur regulations for the country.

Manifold Times has obtained a copy of the notice Implementation of Sulfur Limits Under Rule 14.1 Appendix IV, MARPOL 73/78; its contents are as follows:

Purpose

1. This Notice is to inform the shipping community about the requirement of 0.50% m/m Sulphur Content limit on Regulation 14.1, Annex VI of MARPOL 73/78.
2. The sulphur content of any fuel oil used on board ships shall not exceed 0.50% m/m on and after 1 January 2020 (for ships operating outside an emission control area).
3. Furthermore, the shipping community are advise to comply to related IMO amendments and guidelines as in Appendix 1
4. From 1 January 2020, a Malaysia ship which has to procure non-compliant fuel oil due to the unavailability of compliant fuel would need to complete and submit a Fuel Oil Non-Availability Report form (FONAR) to the Malaysia Marine Department, the Port Authorities where the non-compliant fuel was purchased and the destination Port Authorities. Detail information as in Appendix 2.
5. All Malaysia Ship using new type of 0.5% m/m sulphur compliance fuel oil and plying International Voyages is encourage to submit the Ship Implementation Plan (SIP) for Achieving Compliance with The 0.50% Sulphur Limit as per Appendix 1 in MEPC.1/Circ.878 to Recognised Organisations for verification before 01 January 2020.
6. Malaysia will enforce the MARPOL Annex VI, Regulation 14.1 on 1 January 2020. All Malaysian ships and Foreign ships plying in Malaysian Waters are required to comply with the regulation.