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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, 20 May 14
NEWCASTLE'S COAL EXPORT VOLUME UP 39.11 PERCENT WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 19 May 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, ...
Tuesday, 20 May 14
DRY BULK MARKET TO IMPROVE OVER THE COURSE OF 2014, BUT OVERSUPPLY STILL AN ISSUE SAYS BIMCO'S CHIEF SHIPPING ANALYST
As a gruelling first quarter edges closer to the end, dry bulk ship owners are looking at an improved second quarter demand, which, coupled with sl ...
Tuesday, 20 May 14
DRY BULK MARKET IS BOUND FOR A RECOVERY CLAIMS PARAGON SHIPPING'S HEAD MICHAEL BODOUROGLOU
The dry bulk market is bound for a recovery in the coming weeks, as the market will be better balanced, said Mr. Michael Bodouroglou, Chairman and ...
Monday, 19 May 14
INDO COAL SWAPS FOR AVERAGE Q3' 2014 DELIVERY LOST ON WEEK AND ON MONTH
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on week and on month according to AsiaClear OTC coal swap's reports release ...
Monday, 19 May 14
API 8 CFR SOUTH CHINA COAL LOST 2.49% MONTH ON MONTH
COALspot.com: API 8 CFR South China Coal swaps for average Q3 14 deliveries lost 2.49 percent month on month and closed at US$ 74.35 per mt as on F ...
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- Lanco Infratech Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Simpson Spence & Young - Indonesia
- Central Java Power - Indonesia
- CNBM International Corporation - China
- PTC India Limited - India
- Baramulti Group, Indonesia
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Interocean Group of Companies - India
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- Videocon Industries ltd - India
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Straits Asia Resources Limited - Singapore
- Sarangani Energy Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- LBH Netherlands Bv - Netherlands
- ASAPP Information Group - India
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cement Manufacturers Association - India
- Agrawal Coal Company - India
- Meralco Power Generation, Philippines
- San Jose City I Power Corp, Philippines
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- The Treasury - Australian Government
- Kalimantan Lumbung Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Attock Cement Pakistan Limited
- Latin American Coal - Colombia
- Tata Chemicals Ltd - India
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- London Commodity Brokers - England
- South Luzon Thermal Energy Corporation
- Kumho Petrochemical, South Korea
- Jaiprakash Power Ventures ltd
- Therma Luzon, Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Riau Bara Harum - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- McConnell Dowell - Australia
- Mjunction Services Limited - India
- Oldendorff Carriers - Singapore
- Port Waratah Coal Services - Australia
- GAC Shipping (India) Pvt Ltd
- Kaltim Prima Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Ministry of Finance - Indonesia
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Goldman Sachs - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- Antam Resourcindo - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chettinad Cement Corporation Ltd - India
- Wood Mackenzie - Singapore
- IHS Mccloskey Coal Group - USA
- Romanian Commodities Exchange
- TNB Fuel Sdn Bhd - Malaysia
- GVK Power & Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- Coal and Oil Company - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- SMG Consultants - Indonesia
- SMC Global Power, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- White Energy Company Limited
- Marubeni Corporation - India
- Singapore Mercantile Exchange
- Standard Chartered Bank - UAE
- Energy Link Ltd, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- Indian Oil Corporation Limited
- Savvy Resources Ltd - HongKong
- Anglo American - United Kingdom
- Aditya Birla Group - India
- Kepco SPC Power Corporation, Philippines
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Minerals Council of Australia
- Meenaskhi Energy Private Limited - India
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Electricity Generating Authority of Thailand
- Coalindo Energy - Indonesia
- Sakthi Sugars Limited - India
- Rio Tinto Coal - Australia
- Essar Steel Hazira Ltd - India
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Edison Trading Spa - Italy
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- VISA Power Limited - India
- The State Trading Corporation of India Ltd
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- Petron Corporation, Philippines
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- Sindya Power Generating Company Private Ltd
- Thiess Contractors Indonesia
- Kartika Selabumi Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- OPG Power Generation Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Parliament of New Zealand
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Sree Jayajothi Cements Limited - India
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- Indogreen Group - Indonesia
- Bulk Trading Sa - Switzerland
- PNOC Exploration Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Medco Energi Mining Internasional
- MS Steel International - UAE
- AsiaOL BioFuels Corp., Philippines
- Larsen & Toubro Limited - India
- Cigading International Bulk Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Grasim Industreis Ltd - India
- The University of Queensland
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- International Coal Ventures Pvt Ltd - India
- Eastern Energy - Thailand
- Bharathi Cement Corporation - India
- Vizag Seaport Private Limited - India
- Krishnapatnam Port Company Ltd. - India
- Intertek Mineral Services - Indonesia
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Indian Energy Exchange, India
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Merrill Lynch Commodities Europe
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- Vedanta Resources Plc - India
- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Energy Development Corp, Philippines
- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- Australian Coal Association
- Xindia Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
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