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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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Saturday, 01 February 20
THERMAL COAL MARKETS: 5 TRENDS TO WATCH OUT FOR IN 2020 - MINING REVIEW
The seaborne thermal coal market entered the year challenged by low priced LNG in the Atlantic and rapidly increasing supply in the Pacific.
&n ...
Saturday, 01 February 20
COAL IS NOT GOING ANYWHERE - MINING REVIEW
The coal sector is living under the constant threat of being blamed by environmentalists as being responsible for a world disaster called global wa ...
Saturday, 01 February 20
CIL PRODUCTION TO NOT EXCEED 640 MILLION TON IN FY20: OFFICIAL - PTI
Hit by disruptions due to a prolonged monsoon, mining major Coal India Ltd’s production in the current fiscal will not exceed 640 million ton ...
Saturday, 01 February 20
WHO PAYS FOR IMO 2020? - FREIGHT WAVES
The United Nations’ International Maritime Organization (IMO) implemented its low-sulfur fuel mandate on January 1, 2020. Full enforcement be ...
Friday, 31 January 20
EIA EXPECTS U.S. ELECTRICITY GENERATION FROM RENEWABLES TO SOON SURPASS NUCLEAR AND COAL
In the latest long-term projections, the U.S Energy Information Administration (EIA) projects electricity generation from renewable sources such as ...
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- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Commonwealth Bank - Australia
- Thiess Contractors Indonesia
- Kumho Petrochemical, South Korea
- GMR Energy Limited - India
- Iligan Light & Power Inc, Philippines
- San Jose City I Power Corp, Philippines
- LBH Netherlands Bv - Netherlands
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- Electricity Authority, New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Rio Tinto Coal - Australia
- Ceylon Electricity Board - Sri Lanka
- Star Paper Mills Limited - India
- Petron Corporation, Philippines
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Renaissance Capital - South Africa
- PNOC Exploration Corporation - Philippines
- Sical Logistics Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Therma Luzon, Inc, Philippines
- India Bulls Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Madhucon Powers Ltd - India
- Planning Commission, India
- Energy Link Ltd, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Vedanta Resources Plc - India
- Bhatia International Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- Global Business Power Corporation, Philippines
- White Energy Company Limited
- Sojitz Corporation - Japan
- Billiton Holdings Pty Ltd - Australia
- Bhushan Steel Limited - India
- Heidelberg Cement - Germany
- IEA Clean Coal Centre - UK
- The State Trading Corporation of India Ltd
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Maheswari Brothers Coal Limited - India
- Alfred C Toepfer International GmbH - Germany
- Sakthi Sugars Limited - India
- Antam Resourcindo - Indonesia
- Sarangani Energy Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Ind-Barath Power Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- PTC India Limited - India
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Wilmar Investment Holdings
- Samtan Co., Ltd - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Coal Council - USA
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Mintek Dendrill Indonesia
- Bukit Baiduri Energy - Indonesia
- New Zealand Coal & Carbon
- Africa Commodities Group - South Africa
- Meenaskhi Energy Private Limited - India
- Cement Manufacturers Association - India
- Formosa Plastics Group - Taiwan
- Maharashtra Electricity Regulatory Commission - India
- Chamber of Mines of South Africa
- Directorate Of Revenue Intelligence - India
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- Gujarat Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Carbofer General Trading SA - India
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- Banpu Public Company Limited - Thailand
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Parry Sugars Refinery, India
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Port Waratah Coal Services - Australia
- Borneo Indobara - Indonesia
- Anglo American - United Kingdom
- Mercator Lines Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Grasim Industreis Ltd - India
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- Pipit Mutiara Jaya. PT, Indonesia
- The University of Queensland
- Malabar Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Romanian Commodities Exchange
- Australian Commodity Traders Exchange
- GAC Shipping (India) Pvt Ltd
- Energy Development Corp, Philippines
- Jindal Steel & Power Ltd - India
- Semirara Mining and Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Bukit Makmur.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Indogreen Group - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Transport, Egypt
- Power Finance Corporation Ltd., India
- Wood Mackenzie - Singapore
- TeaM Sual Corporation - Philippines
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Georgia Ports Authority, United States
- IHS Mccloskey Coal Group - USA
- Kapuas Tunggal Persada - Indonesia
- Merrill Lynch Commodities Europe
- Cigading International Bulk Terminal - Indonesia
- SMC Global Power, Philippines
- Ambuja Cements Ltd - India
- ASAPP Information Group - India
- VISA Power Limited - India
- Eastern Energy - Thailand
- GVK Power & Infra Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Mjunction Services Limited - India
- Edison Trading Spa - Italy
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Marubeni Corporation - India
- Goldman Sachs - Singapore
- SMG Consultants - Indonesia
- Trasteel International SA, Italy
- Baramulti Group, Indonesia
- Manunggal Multi Energi - Indonesia
- Siam City Cement PLC, Thailand
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- Indonesian Coal Mining Association
- Leighton Contractors Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Sidhee Cement - India
- Sindya Power Generating Company Private Ltd
- Interocean Group of Companies - India
- Medco Energi Mining Internasional
- Essar Steel Hazira Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indian Oil Corporation Limited
- Indian Energy Exchange, India
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- Minerals Council of Australia
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Thai Mozambique Logistica
- Central Java Power - Indonesia
- Deloitte Consulting - India
- McConnell Dowell - Australia
- Singapore Mercantile Exchange
- Posco Energy - South Korea
- Lanco Infratech Ltd - India
- Electricity Generating Authority of Thailand
- Aditya Birla Group - India
- Agrawal Coal Company - India
- Parliament of New Zealand
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Salva Resources Pvt Ltd - India
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