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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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Wednesday, 02 April 14
BPI BREAKING BELOW THE 1,000 PSYCHOLOGICAL LEVELS - INTERMODAL
Any resistance put forth by the Dry Bulk market the week prior was succumbed this time round. All indices slid and losses were noted across the ...
Tuesday, 01 April 14
NEWCASTLE PORT SHIPPED 11.95 MILLION TONS OF COAL IN MARCH 2014
COALspot.com: In the week ended 31 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2 ...
Monday, 31 March 14
SHIPPING CONFIDENCE HITS HIGHEST LEVEL SINCE 2008 - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for almost six years in the three-month period to February 2014, ...
Monday, 31 March 14
COAL SWAP FOR Q1 2015 DELIVERY HAS CLOSED 4.76% HIGHER COMPARED Q2 14 CLOSING
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 gained this pa ...
Monday, 31 March 14
CFR SOUTH CHINA COAL SWAP FOR Q2 14 DELIVERY LOST 1.17% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.17 percent month on month and closed at US$ 75.38 per m ...
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- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- Kideco Jaya Agung - Indonesia
- Karaikal Port Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- Australian Coal Association
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- Malabar Cements Ltd - India
- Altura Mining Limited, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- PNOC Exploration Corporation - Philippines
- The State Trading Corporation of India Ltd
- SMG Consultants - Indonesia
- Central Java Power - Indonesia
- Bulk Trading Sa - Switzerland
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- Essar Steel Hazira Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Globalindo Alam Lestari - Indonesia
- Latin American Coal - Colombia
- Vedanta Resources Plc - India
- Bhushan Steel Limited - India
- Planning Commission, India
- Ministry of Finance - Indonesia
- Larsen & Toubro Limited - India
- Holcim Trading Pte Ltd - Singapore
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Anglo American - United Kingdom
- Borneo Indobara - Indonesia
- Parliament of New Zealand
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Indogreen Group - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Cement Manufacturers Association - India
- Xindia Steels Limited - India
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Global Green Power PLC Corporation, Philippines
- Bangladesh Power Developement Board
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Madhucon Powers Ltd - India
- Sarangani Energy Corporation, Philippines
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- White Energy Company Limited
- Carbofer General Trading SA - India
- Merrill Lynch Commodities Europe
- Indian Oil Corporation Limited
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- PTC India Limited - India
- Central Electricity Authority - India
- Jaiprakash Power Ventures ltd
- Bhatia International Limited - India
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Siam City Cement - Thailand
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Indo Tambangraya Megah - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Coal and Oil Company - UAE
- Independent Power Producers Association of India
- Eastern Energy - Thailand
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Posco Energy - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wilmar Investment Holdings
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- SN Aboitiz Power Inc, Philippines
- Minerals Council of Australia
- Aditya Birla Group - India
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GMR Energy Limited - India
- Oldendorff Carriers - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate Of Revenue Intelligence - India
- Kaltim Prima Coal - Indonesia
- Australian Commodity Traders Exchange
- Cigading International Bulk Terminal - Indonesia
- Marubeni Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Asmin Koalindo Tuhup - Indonesia
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- Videocon Industries ltd - India
- OPG Power Generation Pvt Ltd - India
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Georgia Ports Authority, United States
- Dalmia Cement Bharat India
- Sree Jayajothi Cements Limited - India
- Africa Commodities Group - South Africa
- Parry Sugars Refinery, India
- CNBM International Corporation - China
- International Coal Ventures Pvt Ltd - India
- Electricity Authority, New Zealand
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Global Business Power Corporation, Philippines
- PowerSource Philippines DevCo
- Pipit Mutiara Jaya. PT, Indonesia
- Baramulti Group, Indonesia
- Bhoruka Overseas - Indonesia
- Binh Thuan Hamico - Vietnam
- Mintek Dendrill Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Heidelberg Cement - Germany
- McConnell Dowell - Australia
- Alfred C Toepfer International GmbH - Germany
- Wood Mackenzie - Singapore
- SMC Global Power, Philippines
- Rio Tinto Coal - Australia
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Indian Energy Exchange, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- Kumho Petrochemical, South Korea
- Tamil Nadu electricity Board
- Jorong Barutama Greston.PT - Indonesia
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Gujarat Sidhee Cement - India
- The University of Queensland
- New Zealand Coal & Carbon
- Gujarat Electricity Regulatory Commission - India
- Economic Council, Georgia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Thiess Contractors Indonesia
- Mercuria Energy - Indonesia
- Deloitte Consulting - India
- ASAPP Information Group - India
- Attock Cement Pakistan Limited
- Petrochimia International Co. Ltd.- Taiwan
- GAC Shipping (India) Pvt Ltd
- Eastern Coal Council - USA
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Sinarmas Energy and Mining - Indonesia
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Chamber of Mines of South Africa
- Kalimantan Lumbung Energi - Indonesia
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Goldman Sachs - Singapore
- Savvy Resources Ltd - HongKong
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- IEA Clean Coal Centre - UK
- Formosa Plastics Group - Taiwan
- Kohat Cement Company Ltd. - Pakistan
- Samtan Co., Ltd - South Korea
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- Jindal Steel & Power Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Petron Corporation, Philippines
- San Jose City I Power Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- IHS Mccloskey Coal Group - USA
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- London Commodity Brokers - England
- Coalindo Energy - Indonesia
- Thai Mozambique Logistica
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