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, 17 April 19
LNG WESTERN AFRICA CONFERENCE 2019
The only LNG Focus Platform to Accelerate Investment and Cooperation in Western African Countries
LNG Western Africa Conference 2019 ...
Saturday, 13 April 19
IMO 2020 - DON'T SCRUB IT! - IVAR MYKLEBUST
KNOWLEDGE TO ELEVATE
Höegh Autoliners stands firm on its decision not to implement scrubbers but comply with the IMO 2020 regulations by ...
Saturday, 13 April 19
CAPESIZE: WEST AUSTRALIA TO CHINA IRON ORE CARGOES LIFTING FROM $4.60 PMT TO ABOVE $5.00 - BALTIC BRIEFING
Capesize
The market saw a steep ascent from the depths of last week. The Baltic Capesize Index (BCI) 5TC opened on Monday at $5,099, although b ...
Friday, 12 April 19
OIL MARKET REPORT: MIXED SIGNALS - IEA
The huge increase in oil production we saw in 2H18 has reversed following the implementation of the new Vienna Agreement and the increasing effecti ...
Friday, 12 April 19
OFFSHORE MENA CONGRESS 2019
Offshore MENA Congress 2019
Event Date : 11-12th Jun. 2019
Location : Cairo, Egypt
Offshore MENA Congress 2019 Offshor ...
|
|
|
Showing 1416 to 1420 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Orica Australia Pty. Ltd.
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Kepco SPC Power Corporation, Philippines
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- European Bulk Services B.V. - Netherlands
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- Sindya Power Generating Company Private Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Georgia Ports Authority, United States
- The University of Queensland
- Parliament of New Zealand
- Independent Power Producers Association of India
- Electricity Generating Authority of Thailand
- Vizag Seaport Private Limited - India
- Orica Mining Services - Indonesia
- Mintek Dendrill Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Power Finance Corporation Ltd., India
- SN Aboitiz Power Inc, Philippines
- Medco Energi Mining Internasional
- Alfred C Toepfer International GmbH - Germany
- Sakthi Sugars Limited - India
- Mjunction Services Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Sinarmas Energy and Mining - Indonesia
- Kaltim Prima Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Planning Commission, India
- Chettinad Cement Corporation Ltd - India
- PTC India Limited - India
- Central Electricity Authority - India
- The State Trading Corporation of India Ltd
- Meralco Power Generation, Philippines
- Larsen & Toubro Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Cigading International Bulk Terminal - Indonesia
- Indika Energy - Indonesia
- Interocean Group of Companies - India
- Bukit Baiduri Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- SMC Global Power, Philippines
- Bayan Resources Tbk. - Indonesia
- San Jose City I Power Corp, Philippines
- Bangladesh Power Developement Board
- Grasim Industreis Ltd - India
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Global Green Power PLC Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Heidelberg Cement - Germany
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Parry Sugars Refinery, India
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Australian Coal Association
- Mercator Lines Limited - India
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- Coal and Oil Company - UAE
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Coastal Gujarat Power Limited - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
- Indogreen Group - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- Toyota Tsusho Corporation, Japan
- The Treasury - Australian Government
- Gujarat Mineral Development Corp Ltd - India
- CIMB Investment Bank - Malaysia
- Madhucon Powers Ltd - India
- PowerSource Philippines DevCo
- White Energy Company Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Indo Tambangraya Megah - Indonesia
- Sical Logistics Limited - India
- Eastern Energy - Thailand
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Renaissance Capital - South Africa
- Marubeni Corporation - India
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Banpu Public Company Limited - Thailand
- Salva Resources Pvt Ltd - India
- Ministry of Transport, Egypt
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Dalmia Cement Bharat India
- Wilmar Investment Holdings
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- London Commodity Brokers - England
- Globalindo Alam Lestari - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement - Thailand
- Bhatia International Limited - India
- CNBM International Corporation - China
- AsiaOL BioFuels Corp., Philippines
- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Oldendorff Carriers - Singapore
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Indonesian Coal Mining Association
- Wood Mackenzie - Singapore
- Anglo American - United Kingdom
- New Zealand Coal & Carbon
- Antam Resourcindo - Indonesia
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Energy Link Ltd, New Zealand
- ICICI Bank Limited - India
- Thai Mozambique Logistica
- Xindia Steels Limited - India
- Rashtriya Ispat Nigam Limited - India
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Global Business Power Corporation, Philippines
- ASAPP Information Group - India
- Miang Besar Coal Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PNOC Exploration Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Eastern Coal Council - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Essar Steel Hazira Ltd - India
- Karaikal Port Pvt Ltd - India
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Cement Manufacturers Association - India
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Maheswari Brothers Coal Limited - India
- Ambuja Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Makarim & Taira - Indonesia
- Jaiprakash Power Ventures ltd
- Leighton Contractors Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- Posco Energy - South Korea
- Chamber of Mines of South Africa
- Singapore Mercantile Exchange
- GMR Energy Limited - India
- Tamil Nadu electricity Board
- Malabar Cements Ltd - India
- SMG Consultants - Indonesia
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Bhoruka Overseas - Indonesia
|
| |
| |
|
