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Thursday, 02 January 20
SULPHUR 2020 COMPENDIUM - HOW ARE INDIVIDUAL PORT STATES EXPECTED TO REACT? - STANDARD CLUB
KNOWLEDGE TO ELEVATE
With the new sulphur limits soon to be in force, Standard Club has been investigating the ways in which certain jurisdictions are expected to react to violations.
We contacted our local correspondents from a variety of different ports, including Brazil, China, Denmark, Norway, Panama, Spain and Sweden, to build a compilation of what we believe is useful and practical knowledge for dealing with future sulphur claims.
We asked our correspondents the following series of questions:
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Will compliant bunkers be available in your jurisdiction?
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Which government body or organisation issues fines for sulphur violations?
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What is the estimated potential value of fines?
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Is there a possibility of criminal action for sulphur violations?
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Can a ship be detained for violations? If so, will a club LOU be accepted to secure its release?
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Is it possible to appeal fines?
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What contingency measures are available for ships carrying non-compliant fuel?
The answers to these questions are as follows. If you have questions about any of these jurisdictions, or any jurisdictions which are not listed below, please contact your usual claims handler at the club for further assistance.
Brazil
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Compliant bunkers will be available in Salvador, Sao Luis, Belem and Macapa.
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Fines may be issued by the ANP, IBAMA (the Environmental Authority) or the Harbour Master´s Office at each port.
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The estimated potential fines range from BRL 5,000 to BRL 2,000,000.
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There is a possibility of criminal action for sulphur violations in Brazil.
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A ship may be detained for sulphur violations until it is proved that there are bunkers within specification on board. Acceptance of a club LOU will depend on each individual case.
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It is possible to appeal fines.
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In the event of non-compliance, the Authorities will need to verify that the off-spec bunkers have been segregated on board.
China
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Compliant bunkers should be available in China. However, members should check with local agents and the port authority before calling to confirm availability.
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The local marine authority (the MSA) issues fines for sulphur violations.
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According to the PRC Air Pollution Prevention and Control Law, shipowners may face administrative penalties ranging from RMB10,000 to RMB100,000.
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While this is unlikely, there is a possibility for criminal action in the event of serious violations.
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Ships can be detained, depending on the seriousness of the violation. It is not known whether a club LOU would be accepted.
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Appeals of fines are unlikely to be successful if a violation has in fact occurred. However, owners may apply for a review of the fine if they suspect that the administrative procedures have been incorrectly applied (i.e. there has been no violation).
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From 1 January 2020 if a ship is unable to obtain compliant bunkers she should submit a FONAR to the MSA before entering Chinese waters. From 1 March 2020 if a ship is carrying non-compliant bunkers in Chinese waters they can discharge the non-compliant bunkers, or (subject to MSA approval) retain the non-compliant bunkers on board after providing a letter of commitment not to use these bunkers in Chinese waters.
Denmark
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Compliant bunkers will be available in Denmark.
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The Port State Control and the police both administer fines for sulphur violations.
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Fines for non-compliance can range from DKK 30,000 to DKK 300,000.
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Criminal action may in some cases be brought for non-compliance. Fines are imposed by the police, following penalty proceedings and public court hearings. In cases of gross negligence, or of continuous violation of the sulphur cap, there is the possibility of imprisonment for up to two years.
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A ship can be detained until it has taken the necessary steps to ensure compliance with the sulphur content regulations. Club LOUs will not be accepted to secure release of the ship.
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Fines can be appealed through the usual judicial channels (at the Court of Appeal and potentially at the Supreme Court).
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If the ship is not compliant with the sulphur regulations, it will be asked by officials to demonstrate that it has taken adequate steps to be compliant. The owner will have to demonstrate that they have established procedures on board the ship to ensure compliance. The owner will also have to provide documentation showing their attempts to obtain compliant bunkers.
Norway
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Compliant bunkers will be available in Norway.
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The Norwegian Maritime Authority (Sjøfartsdirektoratet) issues fines for violations.
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The lowest possible fine is around NOK 79,886. Fines are typically around NOK 250,000, although this figure may be higher depending on the degree of negligence and/or guilt.
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Criminal action may be brought for violations.
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Arrest of the ship for violation of the sulphur limits is possible.
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It is possible to appeal fines to the Norwegian Ministry of Climate and Environment.
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In the event of non-compliance, compliant bunkers are available so that the non-compliant bunkers can be replaced.
Panama
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Compliant bunkers will be available in Panama.
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Fines will be administered by the Panama Maritime Authority (PMA) and the Panama Canal Authority (PCA).
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The PMA and PCA will calculate fines based on the perceived seriousness of the violation. To date, there have been no known fines by the PMA or PCA, so it is difficult to say how they will deal with these incidents.
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Currently there have not been any known criminal proceedings relating to sulphur violations.
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A ship can be detained by both the PMA and PCA for violations, although this is seen to be unlikely. The PMA has in the past been vague regarding club LOU’s but the PCA regularly accepts them for other issues.
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Administrative fines are generally unappealable.
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There are limited options for ships to debunker non-compliant fuel at Panama.
Spain
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Compliant bunkers will be available in Spain.
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The Spanish Central Government Authority issues fines for sulphur violations. The Harbour Master’s office belongs to Merchant Marine General Management, which itself belongs to the Government Ministry in charge of public work.
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There is no set figure for fines. Fines are usually around EUR 22,000 although they could be as high as EUR 180,000. In case of wilful actions, the fine could be as high as EUR 600,000. The Harbour Master will ask for a guarantee to permit the ship to sail (club LOUs are not accepted).
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In theory there is a possibility of criminal action, but only if the use of off-spec bunkers was deliberate.
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A ship can be detained for sulphur violations. In such a case, a club LOU will not be accepted. Authorities will only accept a cash deposit, a bond or a bank security issued by a Spanish Insurer or Bank.
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It is possible to appeal fines, but success is unlikely.
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Any non-compliant bunkers on board will be banned, even if not in use, and similar sanctions will be imposed unless the ship has a scrubber in good operational condition. In addition to the sampling of storage tanks, evidence of tank cleaning and a bunker delivery note will also be required on board.
Sweden
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Compliant bunkers will be available in Sweden.
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The Coast Guard will issue fines for sulphur violations.
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The estimated value of fines is still under discussion. However, there is a risk that fines may be high value to deter non-compliance with the sulphur limits.
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There are not expected to be any criminal repercussions for non-compliance, only fines.
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In very extreme cases, ships can be detained for sulphur violations. It is difficult to predict whether the authorities will accept a club LOU in this situation.
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It is possible to appeal fines.
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In the event of non-compliance, there are many well established bunker operators in the region who can handle non-compliant bunkers.
Source: Standard Club
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Wednesday, 06 May 20
KOSPO INVITED COAL BIDS FOR LOW CALORIFIC VALUE COAL
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 160,000 Metric Tons (MT) Low Calorific Value Coal for J ...
Wednesday, 06 May 20
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A new approach is needed to ensure supply sector resilience
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It’s going to g ...
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KNOWLEDGE TO ELEVATE
Due to a combination of circumstances there is now a worldwide shortage of storage space ashore for both unrefi ...
Wednesday, 06 May 20
IRON ORE TRADE REMAINS REMARKABLY RESILIENT THIS YEAR, AT LEAST IN ASIA - BANCHERO COSTA
Iron ore trade remains remarkably resilient this year, at least in Asia, despite the global economic impact from COVID-19. In the first 4 months of ...
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- Karbindo Abesyapradhi - Indoneisa
- Intertek Mineral Services - Indonesia
- Central Electricity Authority - India
- Straits Asia Resources Limited - Singapore
- Essar Steel Hazira Ltd - India
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- VISA Power Limited - India
- Planning Commission, India
- Africa Commodities Group - South Africa
- Banpu Public Company Limited - Thailand
- Carbofer General Trading SA - India
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Sakthi Sugars Limited - India
- Barasentosa Lestari - Indonesia
- ICICI Bank Limited - India
- Antam Resourcindo - Indonesia
- Posco Energy - South Korea
- India Bulls Power Limited - India
- SMC Global Power, Philippines
- Sical Logistics Limited - India
- Coalindo Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- PetroVietnam Power Coal Import and Supply Company
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- CNBM International Corporation - China
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Australia Pty. Ltd.
- Grasim Industreis Ltd - India
- San Jose City I Power Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Videocon Industries ltd - India
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- Sree Jayajothi Cements Limited - India
- TeaM Sual Corporation - Philippines
- Bharathi Cement Corporation - India
- Formosa Plastics Group - Taiwan
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Australian Commodity Traders Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- PTC India Limited - India
- SN Aboitiz Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- White Energy Company Limited
- Ministry of Finance - Indonesia
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Electricity Authority, New Zealand
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Vedanta Resources Plc - India
- Indogreen Group - Indonesia
- Latin American Coal - Colombia
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- The University of Queensland
- Riau Bara Harum - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Jaiprakash Power Ventures ltd
- Lanco Infratech Ltd - India
- Mercuria Energy - Indonesia
- Dalmia Cement Bharat India
- Central Java Power - Indonesia
- Medco Energi Mining Internasional
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Australian Coal Association
- Bhatia International Limited - India
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Kideco Jaya Agung - Indonesia
- Borneo Indobara - Indonesia
- GVK Power & Infra Limited - India
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- Sojitz Corporation - Japan
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- Independent Power Producers Association of India
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Therma Luzon, Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Gujarat Sidhee Cement - India
- Maheswari Brothers Coal Limited - India
- Sindya Power Generating Company Private Ltd
- London Commodity Brokers - England
- Deloitte Consulting - India
- Baramulti Group, Indonesia
- CIMB Investment Bank - Malaysia
- Madhucon Powers Ltd - India
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Savvy Resources Ltd - HongKong
- LBH Netherlands Bv - Netherlands
- Bangladesh Power Developement Board
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Renaissance Capital - South Africa
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Singapore Mercantile Exchange
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Vizag Seaport Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Iligan Light & Power Inc, Philippines
- McConnell Dowell - Australia
- Heidelberg Cement - Germany
- Energy Link Ltd, New Zealand
- Indonesian Coal Mining Association
- Bhushan Steel Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Mercator Lines Limited - India
- Economic Council, Georgia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Cigading International Bulk Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Indika Energy - Indonesia
- Meralco Power Generation, Philippines
- Power Finance Corporation Ltd., India
- Pendopo Energi Batubara - Indonesia
- Romanian Commodities Exchange
- Bahari Cakrawala Sebuku - Indonesia
- Sarangani Energy Corporation, Philippines
- Star Paper Mills Limited - India
- PNOC Exploration Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Trasteel International SA, Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- Rashtriya Ispat Nigam Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Attock Cement Pakistan Limited
- Karaikal Port Pvt Ltd - India
- Wilmar Investment Holdings
- Binh Thuan Hamico - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Parry Sugars Refinery, India
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Eastern Energy - Thailand
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- The Treasury - Australian Government
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Global Coal Blending Company Limited - Australia
- Maharashtra Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- European Bulk Services B.V. - Netherlands
- Bulk Trading Sa - Switzerland
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- Rio Tinto Coal - Australia
- Krishnapatnam Port Company Ltd. - India
- Asmin Koalindo Tuhup - Indonesia
- Minerals Council of Australia
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- Gujarat Electricity Regulatory Commission - India
- Petron Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- MS Steel International - UAE
- Aditya Birla Group - India
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