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Monday, 14 July 14
THE END OF THE ERA OF HEAVY FUEL OIL IN MARITIME SHIPPING - ICCT
 KNOWLEDGE TO ELEVATE
Since the 1960s, heavy fuel oil (HFO) has been the king of marine fuels. Viscous, dirty, yet inexpensive and widely available, HFO propelled a long period of robust growth in international shipping, which carries over 90% of intercontinental trade by volume each year. For many, it is the lifeblood of the maritime shipping industry.
But HFO’s low price does not reflect its impacts on the environment and human health. The sulfur content of HFO can be up to 35,000 parts per million. It is the reason that maritime shipping accounts for 8% of global emissions of sulfur dioxide (SO2), making the industry an important source for acid rain as well as respiratory diseases. In some populous port cities, such as Hong Kong, shipping is the largest single source of SO2 emissions as well as emissions of particulate matter (PM), which are directly tied to the sulfur content of fuel. By one estimate, PM emissions from maritime shipping led to 87,000 premature deaths worldwide in 2012.
The International Maritime Organization (IMO), the governing body of international shipping, has made a decisive effort to diversify the industry away from HFO into cleaner fuels with less harmful effects on the environment and human health. Effective in 2015, ships operated within the Emission Control Areas (ECAs) covering the Economic Exclusive Zone of North America, the Baltic Sea, the North Sea, and the English Channel will begin to use Marine Gas Oil (MGO) with allowable sulfur content up to 1,000 ppm. Starting from 2020, ships sailing outside ECAs will switch to Marine Diesel Oil (MDO) with permitted sulfur content up to 5,000 ppm.*
That tectonic shift also creates openings for a variety of new fuels. Liquefied nature gas (LNG), newly abundant and relatively affordable, is attracting the attention of many shipping companies. Although the lack of infrastructure and the uncertainty of future prices have slowed the “dash to gas,” many expect LNG to establish itself as one of major alternatives to HFO in the future. Lloyds Registry, a shipping classification society, expects LNG to take 11% of the market share in 2030.
Meanwhile, Stena Teknik, a Swedish company, is testing methanol, another natural gas product, but one that requires less storage space in a ship and is relatively easier to handle. While natural gas-based fuels may sometimes offer questionable climate benefits, due to methane leakage concerns, the IMO’s low-sulfur regulation may create needed openings for other zero-sulfur, low-carbon marine fuels. Tests using fuel cells on the Viking Lady, an offshore supply ship, demonstrated promising results.
Wind kites and solar panels have already been installed on numerous ships to supplement marine diesel engines. Even HFO will not completely disappear from the menu of marine fuels. Combined with scrubbers that capture more than 99% of the sulfur from the exhaust gas, HFO will continue to play an important role. Lloyds Registry reckons that HFO will represent about 40% of fuel use by 2030.
The shift to cleaner but pricier low-sulfur fuels is likely to heighten interest in the “fifth fuel”: energy efficiency. Historically, the maritime shipping industry, where energy often accounts for over half of operating costs, has responded to escalating fuel prices with innovative energy-saving strategies. To cite a recent example: in 2008, as fuel prices went through the roof, shipping lines cut their operating speeds by as much as 50%, helping many companies stay afloat amid one of the worst downturns in history. In an analysis of satellite data on ship operations, we’ve estimated that the industry can further slash 100 million ton of fuel use by 2030 through wider implementation of energy-saving measures that were adopted by industry leaders in 2011.
This is in addition to savings of 90 million tons of fuel because of the Energy Efficiency Design Index (EEDI), a mandatory program that will require new ships to achieve certain efficiency targets beginning in 2015.
The continued diversification of marine fuels and improvements in energy efficiency have important implications. First and foremost, they may alleviate concerns about the availability of low-sulfur fuels. Figure 1 illustrates one possible scenario, using our forecast on future marine fuel consumption and energy efficiency improvements as well as Lloyds Registry’s estimate of market shares for HFO and LNG. The efficiency improvement of the legacy fleet is the greatest force driving down the need for low-sulfur fuels, equivalent to adding about 110 “negatons” of fuel, or almost 24% of projected demand. HFO combined with scrubbers, EEDI, and distillates (MGO plus MDO) are almost neck and neck, each representing about 20% of fuel use in the chart. LNG is coming of age, with its share doubling between 2020 and 2030. Other fuels, such as renewables, fuel cells, and biofuels, are expected to hold only small market shares in 2030.
Second, the new fuels are on a collision course with IMO safety regulations concerning flashpoint, the temperature at which a fuel can vaporize to form an ignitable mixture in air.
The IMO currently requires marine fuels to have a minimum flashpoint of 60°C. But low-sulfur fuels have a lower flashpoint (50° to 55°C), meaning that they are “off-spec” and cannot be used under the IMO rule. The flashpoint requirement, which went into effect in 1976, was meant to provide a large margin of error to ensure the temperature of the engine room (normally below 45°C) does not exceed the flashpoint in any circumstance. But according to industry heavyweights such as Maersk and BIMCO, modern technologies such as advanced ventilation systems provide an adequate safety margin, and they argue that keeping the flashpoint requirement will cause the industry to miss the opportunity represented by the increased availability of low-sulfur, low-flashpoint fuels. Industry and member states such as the U.S. are urging the IMO to accelerate its consideration of an amendment to the flashpoint requirement.
By: Haifeng Wang / The International Council of Clean Transportation
*Implementation of the requirement is subject to a review of fuel availability to be completed by 2016.
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Tuesday, 11 April 23
OIL RISES ON CHINA STIMULUS EXPECTATIONS, WEAKER DOLLAR - REUTERS
Oil prices rose on Tuesday on expectations of potential economic stimulus by China, healthy demand in the rest of Asia and a drop in U.S. crude sto ...
Sunday, 09 April 23
CHINA’S BUSINESS INCOME REBOUND POINTS TO IMPROVING ECONOMY: OFFICIAL - XINHUA
Chinese businesses have posted a strong rebound in sales revenue since the beginning of this year in the latest signal of an improving economy.
...
Sunday, 09 April 23
COAL INDIA TO BOOST SUPPLIES TO INDUSTRIES AS UTILITIES’ INVENTORIES RISE - REUTERS
Coal India Ltd will increase supplies to industries, the world’s largest coal miner said on Wednesday as fuel inventories at utilities run by ...
Thursday, 06 April 23
MARKET INSIGHT - INTERMODAL
LNG Current Supply/Demand Dynamics
This year, LNG supply will likely exceed demand, so prices will need to decline to levels that will encourag ...
Sunday, 26 March 23
EUROPE’S RUSH TO LNG COULD TURN INTO 'WORLD’S MOST EXPENSIVE AND UNNECESSARY INSURANCE POLICY'- CNBC
Europe’s rapid buildout of liquefied natural gas infrastructure is on track to far exceed demand by the end of the decade, according to new r ...
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- The University of Queensland
- Wilmar Investment Holdings
- Bulk Trading Sa - Switzerland
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Vedanta Resources Plc - India
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kumho Petrochemical, South Korea
- VISA Power Limited - India
- Siam City Cement - Thailand
- Indogreen Group - Indonesia
- The Treasury - Australian Government
- Kepco SPC Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- Agrawal Coal Company - India
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- Economic Council, Georgia
- PowerSource Philippines DevCo
- Central Java Power - Indonesia
- ASAPP Information Group - India
- Parliament of New Zealand
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- The State Trading Corporation of India Ltd
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Iligan Light & Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- SMC Global Power, Philippines
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- India Bulls Power Limited - India
- Interocean Group of Companies - India
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Meralco Power Generation, Philippines
- Kapuas Tunggal Persada - Indonesia
- GVK Power & Infra Limited - India
- Sical Logistics Limited - India
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Dalmia Cement Bharat India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Uttam Galva Steels Limited - India
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- OPG Power Generation Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- Cigading International Bulk Terminal - Indonesia
- Power Finance Corporation Ltd., India
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Kohat Cement Company Ltd. - Pakistan
- Pendopo Energi Batubara - Indonesia
- Georgia Ports Authority, United States
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Bharathi Cement Corporation - India
- Miang Besar Coal Terminal - Indonesia
- CIMB Investment Bank - Malaysia
- Petron Corporation, Philippines
- Indonesian Coal Mining Association
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- Bhushan Steel Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Trasteel International SA, Italy
- Alfred C Toepfer International GmbH - Germany
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- Merrill Lynch Commodities Europe
- Bukit Baiduri Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Mjunction Services Limited - India
- Kaltim Prima Coal - Indonesia
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Tata Chemicals Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
- Independent Power Producers Association of India
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Kartika Selabumi Mining - Indonesia
- PTC India Limited - India
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- San Jose City I Power Corp, Philippines
- MS Steel International - UAE
- GMR Energy Limited - India
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- Gujarat Sidhee Cement - India
- Global Coal Blending Company Limited - Australia
- Ministry of Transport, Egypt
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Chamber of Mines of South Africa
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- Metalloyd Limited - United Kingdom
- Larsen & Toubro Limited - India
- Barasentosa Lestari - Indonesia
- Eastern Energy - Thailand
- Global Green Power PLC Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Eastern Coal Council - USA
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Minerals Council of Australia
- Sindya Power Generating Company Private Ltd
- Jaiprakash Power Ventures ltd
- Antam Resourcindo - Indonesia
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- ICICI Bank Limited - India
- Mercuria Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Commonwealth Bank - Australia
- Planning Commission, India
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- TeaM Sual Corporation - Philippines
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SMG Consultants - Indonesia
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Heidelberg Cement - Germany
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Global Business Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Karaikal Port Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Riau Bara Harum - Indonesia
- Oldendorff Carriers - Singapore
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- Indian Energy Exchange, India
- Bhatia International Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Baramulti Group, Indonesia
- Electricity Authority, New Zealand
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Therma Luzon, Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Indika Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
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