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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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Sunday, 13 April 14
INDONESIA TO INDIA FREIGHT MARKET DECLINE CONTINUES
COALspot.com: The freight market continued to drop this week and BDI almost touched 1000 points. BDI closed at 1002 points fell 16.85 pct week o ...
Saturday, 12 April 14
HOW DO YOU CALCULATE LOSS OF EARNINGS FOLLOWING A COLLISION? - INCE & CO
KNOWLEDGE TO ELEVATE
The recent case of Astipalaia vs Hanjin Shenzhen [2014] EWHC 120 (Admlty) has revisited the existing case law on asses ...
Friday, 11 April 14
US COAL PRODUCTION IN MARCH INCREASED 9.69% TO 82.6 MMST MONTH ON MONTH
COALspot.com – United States the world's second largest coal producer, produced approximately 19.10 million short tons (mmst) of coal ...
Thursday, 10 April 14
DRY BULK MARKET IS RISING CLAIMS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite the recent fall of the Baltic Dry Index (BDI), when one compares the first quarter of 2014, to similar quarters of the recent past, it i ...
Wednesday, 09 April 14
DRY BULK MARKET STRUGGLED THROUGHOUT THE WEEK - INTERMODAL
The Dry Bulk market struggled throughout the week but the poor performance across the board didn't allow for any positive reversal, pushing ...
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercuria Energy - Indonesia
- VISA Power Limited - India
- Mercator Lines Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Cement Manufacturers Association - India
- Bharathi Cement Corporation - India
- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- AsiaOL BioFuels Corp., Philippines
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Central Java Power - Indonesia
- Bayan Resources Tbk. - Indonesia
- Bhoruka Overseas - Indonesia
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
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- Central Electricity Authority - India
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- Commonwealth Bank - Australia
- Global Business Power Corporation, Philippines
- Videocon Industries ltd - India
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
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- Ind-Barath Power Infra Limited - India
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- Singapore Mercantile Exchange
- Indonesian Coal Mining Association
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- TNB Fuel Sdn Bhd - Malaysia
- New Zealand Coal & Carbon
- Global Coal Blending Company Limited - Australia
- Rashtriya Ispat Nigam Limited - India
- Kepco SPC Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- International Coal Ventures Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- Planning Commission, India
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- Standard Chartered Bank - UAE
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- Wilmar Investment Holdings
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- Jaiprakash Power Ventures ltd
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- PNOC Exploration Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Economic Council, Georgia
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Madhucon Powers Ltd - India
- Dalmia Cement Bharat India
- India Bulls Power Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- Binh Thuan Hamico - Vietnam
- Krishnapatnam Port Company Ltd. - India
- Heidelberg Cement - Germany
- Medco Energi Mining Internasional
- Latin American Coal - Colombia
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- White Energy Company Limited
- Indogreen Group - Indonesia
- Alfred C Toepfer International GmbH - Germany
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Kideco Jaya Agung - Indonesia
- Savvy Resources Ltd - HongKong
- Uttam Galva Steels Limited - India
- Salva Resources Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- Sojitz Corporation - Japan
- GAC Shipping (India) Pvt Ltd
- Energy Development Corp, Philippines
- Grasim Industreis Ltd - India
- Electricity Authority, New Zealand
- Indo Tambangraya Megah - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Africa Commodities Group - South Africa
- Jorong Barutama Greston.PT - Indonesia
- Deloitte Consulting - India
- Timah Investasi Mineral - Indoneisa
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Lanco Infratech Ltd - India
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Sakthi Sugars Limited - India
- Kartika Selabumi Mining - Indonesia
- Indian Oil Corporation Limited
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- Holcim Trading Pte Ltd - Singapore
- Billiton Holdings Pty Ltd - Australia
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- Mintek Dendrill Indonesia
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Tata Chemicals Ltd - India
- Toyota Tsusho Corporation, Japan
- IEA Clean Coal Centre - UK
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Energy Link Ltd, New Zealand
- PTC India Limited - India
- SMG Consultants - Indonesia
- Edison Trading Spa - Italy
- Bukit Makmur.PT - Indonesia
- Coalindo Energy - Indonesia
- Mjunction Services Limited - India
- Australian Coal Association
- Directorate Of Revenue Intelligence - India
- Goldman Sachs - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Kumho Petrochemical, South Korea
- Meralco Power Generation, Philippines
- Vizag Seaport Private Limited - India
- Gujarat Sidhee Cement - India
- Iligan Light & Power Inc, Philippines
- Ambuja Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Semirara Mining Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- Thai Mozambique Logistica
- Global Green Power PLC Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- Bangladesh Power Developement Board
- Bank of Tokyo Mitsubishi UFJ Ltd
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Anglo American - United Kingdom
- Petron Corporation, Philippines
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- Jindal Steel & Power Ltd - India
- Agrawal Coal Company - India
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- Aditya Birla Group - India
- London Commodity Brokers - England
- Vedanta Resources Plc - India
- Eastern Energy - Thailand
- Renaissance Capital - South Africa
- SN Aboitiz Power Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- San Jose City I Power Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Power Finance Corporation Ltd., India
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Baramulti Group, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- Altura Mining Limited, Indonesia
- TeaM Sual Corporation - Philippines
- Rio Tinto Coal - Australia
- Tamil Nadu electricity Board
- Barasentosa Lestari - Indonesia
- Merrill Lynch Commodities Europe
- Neyveli Lignite Corporation Ltd, - India
- Parry Sugars Refinery, India
- Ceylon Electricity Board - Sri Lanka
- The State Trading Corporation of India Ltd
- Carbofer General Trading SA - India
- SMC Global Power, Philippines
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
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