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.
|
|
Wednesday, 20 November 19
FOREIGN DIRECT INVESTMENTS IN COMMERCIAL COAL MINING IN INDIA? - DIPESH DIPU
In August 2019, Government of India announced its approval for Foreign Direct Investment (FDI) for coal mining, processing and sale. Not that FDI i ...
Wednesday, 20 November 19
AUSTRALIA'S NEW HOPE POSTS 66% SURGE IN Q1 SALEABLE COAL OUTPUT - REUTERS
Australian coal producer New Hope Corp Ltd reported on Tuesday a 66% jump in saleable coal production in the first quarter, as output ramped up at ...
Wednesday, 20 November 19
THE IMO AND THE PRICE OF GAS OR THE IMPACT OF THE INTERNATIONAL MARITIME ORGANISATION'S SULPHUR 2020 LIMIT FOR MARINE FUEL OIL ON THE PRICE OF GAS - KING & SPALDING
The main bunker fuel for ships is High Sulphur Fuel Oil (HSFO, with sulphur up to 3.5% m/m (mass by mass)). This will all change on 1 January 2020 ...
Wednesday, 20 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
While the market expects the next OPEC meeting, there are still no clear signs indicating that the organization will keep supporting oil prices, wh ...
Monday, 18 November 19
CHINA RECORDS STABLE COAL PRODUCTION IN JAN-OCT: XINHUA
China’s raw coal output registered stable growth in the first 10 months, while its imports remained robust, official data showed.
...
|
|
|
Showing 1281 to 1285 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Indonesian Coal Mining Association
- Sindya Power Generating Company Private Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Lanco Infratech Ltd - India
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- Marubeni Corporation - India
- PTC India Limited - India
- Bukit Makmur.PT - Indonesia
- ICICI Bank Limited - India
- Coalindo Energy - Indonesia
- Thai Mozambique Logistica
- Goldman Sachs - Singapore
- Timah Investasi Mineral - Indoneisa
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- Electricity Generating Authority of Thailand
- Latin American Coal - Colombia
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- Ministry of Transport, Egypt
- Anglo American - United Kingdom
- Romanian Commodities Exchange
- Mercator Lines Limited - India
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Commonwealth Bank - Australia
- MS Steel International - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Development Corp, Philippines
- Bhatia International Limited - India
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Vizag Seaport Private Limited - India
- Orica Australia Pty. Ltd.
- SN Aboitiz Power Inc, Philippines
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Directorate Of Revenue Intelligence - India
- Uttam Galva Steels Limited - India
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- Carbofer General Trading SA - India
- Neyveli Lignite Corporation Ltd, - India
- Sical Logistics Limited - India
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Bayan Resources Tbk. - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Port Waratah Coal Services - Australia
- IHS Mccloskey Coal Group - USA
- Global Green Power PLC Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Chamber of Mines of South Africa
- Indo Tambangraya Megah - Indonesia
- Dalmia Cement Bharat India
- OPG Power Generation Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- South Luzon Thermal Energy Corporation
- Malabar Cements Ltd - India
- Tamil Nadu electricity Board
- Jindal Steel & Power Ltd - India
- Cement Manufacturers Association - India
- Samtan Co., Ltd - South Korea
- Singapore Mercantile Exchange
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Pendopo Energi Batubara - Indonesia
- Kumho Petrochemical, South Korea
- White Energy Company Limited
- Sarangani Energy Corporation, Philippines
- Africa Commodities Group - South Africa
- Planning Commission, India
- Bulk Trading Sa - Switzerland
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- CIMB Investment Bank - Malaysia
- Therma Luzon, Inc, Philippines
- Salva Resources Pvt Ltd - India
- Eastern Coal Council - USA
- Jaiprakash Power Ventures ltd
- Semirara Mining and Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- The University of Queensland
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Larsen & Toubro Limited - India
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Parry Sugars Refinery, India
- Kohat Cement Company Ltd. - Pakistan
- Barasentosa Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- VISA Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Parliament of New Zealand
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Price Waterhouse Coopers - Russia
- Alfred C Toepfer International GmbH - Germany
- Thiess Contractors Indonesia
- Makarim & Taira - Indonesia
- Coastal Gujarat Power Limited - India
- CNBM International Corporation - China
- Iligan Light & Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- Australian Coal Association
- TNB Fuel Sdn Bhd - Malaysia
- Georgia Ports Authority, United States
- Madhucon Powers Ltd - India
- The State Trading Corporation of India Ltd
- Indian Energy Exchange, India
- Ambuja Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Meenaskhi Energy Private Limited - India
- Power Finance Corporation Ltd., India
- Billiton Holdings Pty Ltd - Australia
- New Zealand Coal & Carbon
- Heidelberg Cement - Germany
- Merrill Lynch Commodities Europe
- Gujarat Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Sojitz Corporation - Japan
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Finance - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- Vedanta Resources Plc - India
- Banpu Public Company Limited - Thailand
- Indika Energy - Indonesia
- ASAPP Information Group - India
- International Coal Ventures Pvt Ltd - India
- Petron Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Wilmar Investment Holdings
- Semirara Mining Corp, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Miang Besar Coal Terminal - Indonesia
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Deloitte Consulting - India
- Central Electricity Authority - India
- Essar Steel Hazira Ltd - India
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Orica Mining Services - Indonesia
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Economic Council, Georgia
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- SMC Global Power, Philippines
- GAC Shipping (India) Pvt Ltd
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhushan Steel Limited - India
- Edison Trading Spa - Italy
- Jorong Barutama Greston.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Minerals Council of Australia
|
| |
| |
|
