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, 13 November 19
INDONESIAN NOVEMBER COAL PRICE REFERENCE LOGS FIRST GAIN SINCE AUGUST
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised up the benchmark price of Indonesian thermal co ...
Wednesday, 13 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
The improvements seen in the dry bulk market during the unexpectedly strong Q3 brought enthusiasm and optimism for a last quarter rally. Indeed as ...
Tuesday, 12 November 19
COAL IMPORTS AT MAJOR PORTS SLIP 18 PC TO 51 MT IN APRIL-OCTOBER - ECONOMIC TIMES
The Indian Ports Association (IPA), which maintains cargo data handled by these 12 ports, in its recent report, said "percentage variation fro ...
Monday, 11 November 19
EMINENT MARITIME ORGANIZATIONS AND INDIVIDUALS WERE HONORED
SHIPTEK 2019 Anchors in Greece for its 12th edition.
Eminent Maritime Organizations and Individuals were honored
Greec ...
Wednesday, 06 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
With less than two months before the end of the year, the shipping and refining industries have already taken measures and invested to accommodate ...
|
|
|
Showing 1291 to 1295 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- SMG Consultants - Indonesia
- Siam City Cement PLC, Thailand
- Manunggal Multi Energi - Indonesia
- Mjunction Services Limited - India
- IHS Mccloskey Coal Group - USA
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Trasteel International SA, Italy
- SMC Global Power, Philippines
- Chamber of Mines of South Africa
- Bukit Baiduri Energy - Indonesia
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Bulk Trading Sa - Switzerland
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Coal Council - USA
- Energy Development Corp, Philippines
- Uttam Galva Steels Limited - India
- London Commodity Brokers - England
- Sakthi Sugars Limited - India
- Price Waterhouse Coopers - Russia
- LBH Netherlands Bv - Netherlands
- Bhatia International Limited - India
- Aditya Birla Group - India
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Goldman Sachs - Singapore
- Chettinad Cement Corporation Ltd - India
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Indika Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Carbofer General Trading SA - India
- Orica Mining Services - Indonesia
- Riau Bara Harum - Indonesia
- Vizag Seaport Private Limited - India
- Oldendorff Carriers - Singapore
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- Romanian Commodities Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Planning Commission, India
- Star Paper Mills Limited - India
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Economic Council, Georgia
- India Bulls Power Limited - India
- Mintek Dendrill Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- Kumho Petrochemical, South Korea
- Indonesian Coal Mining Association
- Leighton Contractors Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Central Java Power - Indonesia
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Commonwealth Bank - Australia
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Eastern Energy - Thailand
- White Energy Company Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Jaiprakash Power Ventures ltd
- Electricity Authority, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Makarim & Taira - Indonesia
- Barasentosa Lestari - Indonesia
- Interocean Group of Companies - India
- Petron Corporation, Philippines
- Australian Commodity Traders Exchange
- Jindal Steel & Power Ltd - India
- Metalloyd Limited - United Kingdom
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- PNOC Exploration Corporation - Philippines
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Jorong Barutama Greston.PT - Indonesia
- Malabar Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Orica Australia Pty. Ltd.
- Videocon Industries ltd - India
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Independent Power Producers Association of India
- Gujarat Mineral Development Corp Ltd - India
- Posco Energy - South Korea
- The Treasury - Australian Government
- Bhoruka Overseas - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- CIMB Investment Bank - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cigading International Bulk Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Thiess Contractors Indonesia
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Ministry of Finance - Indonesia
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Power Finance Corporation Ltd., India
- The University of Queensland
- Energy Link Ltd, New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- Central Electricity Authority - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Banpu Public Company Limited - Thailand
- Wilmar Investment Holdings
- VISA Power Limited - India
- Marubeni Corporation - India
- Straits Asia Resources Limited - Singapore
- Electricity Generating Authority of Thailand
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- Ceylon Electricity Board - Sri Lanka
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- ASAPP Information Group - India
- Savvy Resources Ltd - HongKong
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- IEA Clean Coal Centre - UK
- GAC Shipping (India) Pvt Ltd
- Baramulti Group, Indonesia
- OPG Power Generation Pvt Ltd - India
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- SN Aboitiz Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Karaikal Port Pvt Ltd - India
- Ambuja Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Semirara Mining Corp, Philippines
- ICICI Bank Limited - India
- Bukit Makmur.PT - Indonesia
- Renaissance Capital - South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Heidelberg Cement - Germany
- Siam City Cement - Thailand
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- Altura Mining Limited, Indonesia
- Minerals Council of Australia
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- New Zealand Coal & Carbon
- Sojitz Corporation - Japan
- Global Business Power Corporation, Philippines
- Singapore Mercantile Exchange
- Sree Jayajothi Cements Limited - India
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Kartika Selabumi Mining - Indonesia
|
| |
| |
|
