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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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Friday, 14 February 20
KOWEPO INVITED BIDS FOR 1.275 MILLION TONS OF MIN. 5,600 NCV COAL
COALspot.com: Korea Western Power Co. Ltd (KOWEPO). as a representative of five Korean Gencos has issued an international tender for total 1,275,00 ...
Friday, 14 February 20
IS THE US COAL INDUSTRY COMPLETELY BURNED OUT? -FORBES
This is the fourth of a multi-part series on the state of the main sources of energy in the US and how they compare globally. The series will cover ...
Friday, 14 February 20
FITCH RTGS: GLOBAL PORTS VULNERABLE TO CORONAVIRUS - RELATED VOLUME DECLINES
Global ports will see reduced trade volumes as a result of the coronavirus, COVID-19, which would become more severe should Chinese production take ...
Thursday, 13 February 20
INDIA: MAJOR PORTS SHOW MUTED GROWTH IN CARGO AS THERMAL COAL VOLUME SLIDES 15% - BUSINESS STANDARD
A sharp slide of 15 per cent in thermal coal volumes weighed on the performance of major ports during the period of April-January of FY20. The majo ...
Wednesday, 12 February 20
REFINING SET FOR A CHALLENGING 2020 - WOOD MACKENZIE
Downstream isn’t the glamorous end of the oil business. And in Big Oil, it’s typically dwarfed by upstream. Yet having been forced to r ...
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- Power Finance Corporation Ltd., India
- Bangladesh Power Developement Board
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
- India Bulls Power Limited - India
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Romanian Commodities Exchange
- Samtan Co., Ltd - South Korea
- Indian Energy Exchange, India
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Thiess Contractors Indonesia
- Bhatia International Limited - India
- Commonwealth Bank - Australia
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Singapore Mercantile Exchange
- Riau Bara Harum - Indonesia
- MS Steel International - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Chamber of Mines of South Africa
- LBH Netherlands Bv - Netherlands
- PowerSource Philippines DevCo
- Holcim Trading Pte Ltd - Singapore
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Leighton Contractors Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- OPG Power Generation Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Standard Chartered Bank - UAE
- Globalindo Alam Lestari - Indonesia
- PNOC Exploration Corporation - Philippines
- Dalmia Cement Bharat India
- Intertek Mineral Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Therma Luzon, Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- SN Aboitiz Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- ICICI Bank Limited - India
- Parry Sugars Refinery, India
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- Anglo American - United Kingdom
- SMG Consultants - Indonesia
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- Renaissance Capital - South Africa
- Ministry of Finance - Indonesia
- Binh Thuan Hamico - Vietnam
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- Ind-Barath Power Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Australian Commodity Traders Exchange
- Electricity Generating Authority of Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- The University of Queensland
- Ambuja Cements Ltd - India
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Australian Coal Association
- Georgia Ports Authority, United States
- Essar Steel Hazira Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Wood Mackenzie - Singapore
- Merrill Lynch Commodities Europe
- Aboitiz Power Corporation - Philippines
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Jaiprakash Power Ventures ltd
- Central Java Power - Indonesia
- Larsen & Toubro Limited - India
- Pendopo Energi Batubara - Indonesia
- Gujarat Sidhee Cement - India
- GMR Energy Limited - India
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- Kaltim Prima Coal - Indonesia
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- CIMB Investment Bank - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Price Waterhouse Coopers - Russia
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Petrochimia International Co. Ltd.- Taiwan
- Sakthi Sugars Limited - India
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Trasteel International SA, Italy
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Aditya Birla Group - India
- Simpson Spence & Young - Indonesia
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Australia Pty. Ltd.
- Mercator Lines Limited - India
- Latin American Coal - Colombia
- Malabar Cements Ltd - India
- Bharathi Cement Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Videocon Industries ltd - India
- Siam City Cement - Thailand
- Port Waratah Coal Services - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- Karbindo Abesyapradhi - Indoneisa
- Mercuria Energy - Indonesia
- Star Paper Mills Limited - India
- Billiton Holdings Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- Petron Corporation, Philippines
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Vedanta Resources Plc - India
- Energy Link Ltd, New Zealand
- Lanco Infratech Ltd - India
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Parliament of New Zealand
- Manunggal Multi Energi - Indonesia
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Bukit Baiduri Energy - Indonesia
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Kartika Selabumi Mining - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- Sojitz Corporation - Japan
- Edison Trading Spa - Italy
- SMC Global Power, Philippines
- Indika Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- White Energy Company Limited
- Antam Resourcindo - Indonesia
- Global Business Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Sree Jayajothi Cements Limited - India
- Posco Energy - South Korea
- Africa Commodities Group - South Africa
- Interocean Group of Companies - India
- Gujarat Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- TeaM Sual Corporation - Philippines
- Bulk Trading Sa - Switzerland
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Electricity Authority, New Zealand
- Baramulti Group, Indonesia
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- CNBM International Corporation - China
- Minerals Council of Australia
- Mjunction Services Limited - India
- VISA Power Limited - India
- Bukit Makmur.PT - Indonesia
- IHS Mccloskey Coal Group - USA
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