We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Monday, 16 September 19
SCRUBBERS AND FUEL PROFIT SHARE CLAUSES - CLYDE&CO
 From 1 January 2020, Regulation 14 of MARPOL Annex VI provides that the sulphur content in fuel oil used on board ships shall be reduced from a maximum limit of 3.5% to a maximum limit of 0.5% (the limit in emission control areas remains at 0.1%). Regulation 4 of MARPOL Annex VI permits equivalent methods of compliance provided such methods are at least as effective in terms of emissions reductions.
Whilst it is up to individual port state control and flag states to implement and enforce MARPOL Annex VI, the use of Exhaust Gas Cleaning Systems (“Scrubbers”) is widely expected to be a legitimate option as an equivalent method of compliance.
The anticipated key financial benefit for Owners that have invested or are considering in investing in Scrubber-fitted vessels, is that there will be substantial savings in the cost of trading the vessels due to the expected price differential between fuels with a high sulphur content and ‘compliant’ fuels with a low sulphur content. For example, this week press reports suggest that the fuels currently being traded result in a price differential of about $150-$250 per mt between 0.5% sulphur fuels and high sulphur fuels and predict a price differential of over $400 per mt in 2020 (the differential between high sulphur fuels and 0.1% sulphur fuels is greater).1
Owners have various options available to them in terms of benefitting from the expected fuel differential for Scrubber-fitted vessels.
For example, if Owners are spot trading their Scrubber-fitted vessels, typically it is Owners that pay for the fuel so Owners will therefore benefit from the lower costs of burning high sulphur fuels. If Owners are time chartering their vessel, typically under a time charterparty Charterers will pay for the fuel so Charterers will therefore benefit from the lower costs of burning high sulphur fuel. In consideration for providing this benefit under a time charter, Owners may simply demand a higher charter rate or a ‘scrubber premium’ on the market charter rate.
Alternatively, there are a number of creative ways in which Owners and Charterers can share the benefit of the expected or actual fuel savings for Scrubber-fitted vessels. One of these ways is through implementing a fuel profit-sharing scrubber clause (“FPS Scrubber Clause”) into the time charterparty. It has been reported in the press recently that these are being used with good effect by some owners to keep charter rates competitive.2
There are a number of different legal, operational and commercial factors which will have to be considered in negotiating and drafting FPS Scrubber Clauses and so it is unlikely there is a one-size fits all FPS Scrubber Clause that can be applied across the market. By way of example, the ongoing delay to an intended Bimco industry-standard scrubber clause is illustrative of the complexity and competing interests at play. For example, if owners are bearing the majority of the capital risk and operational risk of the Scrubber, then should owners be entitled to the majority of the benefit of the fuel differential? In the event that the Scrubber is not operational for technical or regulatory reasons, who is responsible for providing compliant low sulphur fuel?
An FPS Scrubber Clause is an innovative way for Owners and Charterers to allocate the anticipated risks and benefits of complying with the implementation of MARPOL Annex VI from 1 January 2020 through the use of Scrubbers. James Kennedy and Fanos Theophani have been involved in the negotiation and drafting of FPS Scrubber Clauses and are well placed to advise and assist the market on these issues.
1 “Songa Container pioneers profit-sharing scrubber clause” Tradewinds 30 August 2019
2 “IMO2020: RAI 2020 Marine Fuel Availability Study Re-Boot” Ship and Bunker 3 September 2019, and “IMO2020: Rollercoaster HSFO Prices Send Singapore VLSFO Premiums Under $85/mt” Ship and Bunker 30 August 2019
Source: Clyde&Co
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 02 December 19
OPEC PREPS FOR OIL'S 2020 BALANCING ACT - WOOD MACKENZIE
What steps should OPEC and its non-OPEC partners take to keep the market in balance in 2020? Ahead of OPEC’s meeting in Vienna on 5 and 6 Dec ...
Monday, 02 December 19
GREENER LNG IS VITAL TO ASIA'S SUSTAINABLE DEVELOPMENT - WOOD MACKENZIE
Asia struggles with the world’s worst air pollution. Delhi hit the headlines in November 2019 as levels spiked to such hazardous levels that ...
Monday, 02 December 19
5TH EAST & SOUTHERN AFRICA GAS & LNG CONFERENCE 2020
5th East & Southern Africa Gas & LNG Conference 2020
April 2-3
Maputo, Mozambique
5th East & Southern Afri ...
Monday, 02 December 19
5TH DEEPWATER EAST & SOUTHERN AFRICA CONGRESS 2020
5th Deepwater East & Southern Africa Congress 2020
April 2-3
Maputo, Mozambique
5th Deepwater East & Southern ...
Sunday, 01 December 19
6TH CENTRAL & EASTERN EUROPE NUCLEAR INDUSTRY CONGRESS 2020
6th Central & Eastern Europe Nuclear Industry Congress 2020
January 20-21 | Prague, Czech Republic
Overview
6th ...
|
|
|
Showing 1261 to 1265 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Energy Link Ltd, New Zealand
- Orica Mining Services - Indonesia
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Thiess Contractors Indonesia
- SMC Global Power, Philippines
- Electricity Authority, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- Mintek Dendrill Indonesia
- Kepco SPC Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- IEA Clean Coal Centre - UK
- Sinarmas Energy and Mining - Indonesia
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Ind-Barath Power Infra Limited - India
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Power Finance Corporation Ltd., India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Tata Chemicals Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- PowerSource Philippines DevCo
- Attock Cement Pakistan Limited
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Therma Luzon, Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhushan Steel Limited - India
- Gujarat Sidhee Cement - India
- Antam Resourcindo - Indonesia
- Malabar Cements Ltd - India
- Oldendorff Carriers - Singapore
- Petron Corporation, Philippines
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- Kobexindo Tractors - Indoneisa
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- Alfred C Toepfer International GmbH - Germany
- Jaiprakash Power Ventures ltd
- LBH Netherlands Bv - Netherlands
- Salva Resources Pvt Ltd - India
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Siam City Cement - Thailand
- Wood Mackenzie - Singapore
- Ceylon Electricity Board - Sri Lanka
- Romanian Commodities Exchange
- Sree Jayajothi Cements Limited - India
- AsiaOL BioFuels Corp., Philippines
- SN Aboitiz Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- Interocean Group of Companies - India
- CIMB Investment Bank - Malaysia
- Metalloyd Limited - United Kingdom
- Commonwealth Bank - Australia
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- Parry Sugars Refinery, India
- ASAPP Information Group - India
- Eastern Coal Council - USA
- Toyota Tsusho Corporation, Japan
- Intertek Mineral Services - Indonesia
- Agrawal Coal Company - India
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- Merrill Lynch Commodities Europe
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- Banpu Public Company Limited - Thailand
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asmin Koalindo Tuhup - Indonesia
- Singapore Mercantile Exchange
- Price Waterhouse Coopers - Russia
- Semirara Mining Corp, Philippines
- The University of Queensland
- Iligan Light & Power Inc, Philippines
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Electricity Generating Authority of Thailand
- Riau Bara Harum - Indonesia
- Coal and Oil Company - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- PTC India Limited - India
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Siam City Cement PLC, Thailand
- Karaikal Port Pvt Ltd - India
- Aditya Birla Group - India
- Larsen & Toubro Limited - India
- Rashtriya Ispat Nigam Limited - India
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Mjunction Services Limited - India
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Manunggal Multi Energi - Indonesia
- Formosa Plastics Group - Taiwan
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- Rio Tinto Coal - Australia
- Barasentosa Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- Ambuja Cements Ltd - India
- Ministry of Transport, Egypt
- Mercator Lines Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- White Energy Company Limited
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Kumho Petrochemical, South Korea
- Makarim & Taira - Indonesia
- Billiton Holdings Pty Ltd - Australia
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Madhucon Powers Ltd - India
- Ministry of Finance - Indonesia
- Energy Development Corp, Philippines
- Latin American Coal - Colombia
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- SMG Consultants - Indonesia
- Economic Council, Georgia
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Semirara Mining and Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Carbofer General Trading SA - India
- Bayan Resources Tbk. - Indonesia
- Bulk Trading Sa - Switzerland
- Sical Logistics Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Medco Energi Mining Internasional
- Indonesian Coal Mining Association
- Bhatia International Limited - India
- Dalmia Cement Bharat India
- OPG Power Generation Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Australian Coal Association
- Videocon Industries ltd - India
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Vizag Seaport Private Limited - India
- Standard Chartered Bank - UAE
- Mercuria Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Global Green Power PLC Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Globalindo Alam Lestari - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kohat Cement Company Ltd. - Pakistan
- Bangladesh Power Developement Board
- Port Waratah Coal Services - Australia
- Eastern Energy - Thailand
- GMR Energy Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Indika Energy - Indonesia
- Planning Commission, India
- Altura Mining Limited, Indonesia
- Sindya Power Generating Company Private Ltd
- Bukit Makmur.PT - Indonesia
|
| |
| |
|
