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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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Monday, 23 June 14
COAL SWAPS DROPS FURTHER MONTH ON MONTH ON WEAK DEMAND
COALspot.com: API 8 CFR South China Coal swaps for average Q3 14 deliveries lost 6.91 percent month on month and closed at US$ 69.00 per mt a ...
Sunday, 22 June 14
THE PANAMAX COAL FREIGHT FROM INDONESIA TO INDIA SLIPPED THIS WEEK
COALspot.com: The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, fell slightly on Friday ...
Friday, 20 June 14
DRY BULK MARKET LOOKING FOR UPSIDE ON ROBUST SEABORNE IRON ORE TRADE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market hasn’t been able to justify the heightened expectations this year. Yesterday, the Baltic Dry Index managed to inch forwar ...
Friday, 20 June 14
US WEEKLY COAL PRODUCTION DROPS 1.8% WEEK ON WEEK
COALspot.com – United States the world's second largest coal producer, produced approximately 18.3 million short tons (mmst) of coal in a ...
Thursday, 19 June 14
PANAMAX: VERY CLOSE TO BREAKING THE ALL TIME LOW RECORD - FEARNLEYS AS
Handy
The Supra-Handy market is experiencing the same market slow down as its bigger sister markets however not to the same extent. We see TA rat ...
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- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- CIMB Investment Bank - Malaysia
- Ceylon Electricity Board - Sri Lanka
- Toyota Tsusho Corporation, Japan
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- TeaM Sual Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Makarim & Taira - Indonesia
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Grasim Industreis Ltd - India
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- Merrill Lynch Commodities Europe
- Jaiprakash Power Ventures ltd
- Pipit Mutiara Jaya. PT, Indonesia
- PNOC Exploration Corporation - Philippines
- Wood Mackenzie - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Salva Resources Pvt Ltd - India
- Attock Cement Pakistan Limited
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- IEA Clean Coal Centre - UK
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- Electricity Authority, New Zealand
- Heidelberg Cement - Germany
- PTC India Limited - India
- Mercator Lines Limited - India
- Star Paper Mills Limited - India
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Orica Australia Pty. Ltd.
- Kohat Cement Company Ltd. - Pakistan
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- Coastal Gujarat Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Ministry of Mines - Canada
- MS Steel International - UAE
- Manunggal Multi Energi - Indonesia
- AsiaOL BioFuels Corp., Philippines
- The University of Queensland
- Carbofer General Trading SA - India
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- Straits Asia Resources Limited - Singapore
- ICICI Bank Limited - India
- Altura Mining Limited, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Bharathi Cement Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Australian Commodity Traders Exchange
- GVK Power & Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- OPG Power Generation Pvt Ltd - India
- Madhucon Powers Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Petron Corporation, Philippines
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Agrawal Coal Company - India
- Videocon Industries ltd - India
- McConnell Dowell - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- London Commodity Brokers - England
- Planning Commission, India
- Global Business Power Corporation, Philippines
- The Treasury - Australian Government
- India Bulls Power Limited - India
- Barasentosa Lestari - Indonesia
- ASAPP Information Group - India
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Siam City Cement PLC, Thailand
- Gujarat Sidhee Cement - India
- Therma Luzon, Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Aditya Birla Group - India
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Wilmar Investment Holdings
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- VISA Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Latin American Coal - Colombia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Parry Sugars Refinery, India
- Sical Logistics Limited - India
- Indogreen Group - Indonesia
- Globalindo Alam Lestari - Indonesia
- Indonesian Coal Mining Association
- Port Waratah Coal Services - Australia
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Australian Coal Association
- Vizag Seaport Private Limited - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Commonwealth Bank - Australia
- Indian Energy Exchange, India
- Interocean Group of Companies - India
- Directorate Of Revenue Intelligence - India
- Leighton Contractors Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- White Energy Company Limited
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- New Zealand Coal & Carbon
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Mineral Development Corp Ltd - India
- Central Java Power - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- IHS Mccloskey Coal Group - USA
- Billiton Holdings Pty Ltd - Australia
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Sarangani Energy Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Maheswari Brothers Coal Limited - India
- SMC Global Power, Philippines
- Xindia Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- Trasteel International SA, Italy
- Indian Oil Corporation Limited
- Bhoruka Overseas - Indonesia
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Borneo Indobara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Renaissance Capital - South Africa
- Oldendorff Carriers - Singapore
- Posco Energy - South Korea
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Central Electricity Authority - India
- South Luzon Thermal Energy Corporation
- Deloitte Consulting - India
- Parliament of New Zealand
- Riau Bara Harum - Indonesia
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- Standard Chartered Bank - UAE
- PowerSource Philippines DevCo
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Metalloyd Limited - United Kingdom
- Singapore Mercantile Exchange
- International Coal Ventures Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
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