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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, 04 December 19
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Wednesday, 04 December 19
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Tuesday, 03 December 19
STABILITY AND COMPATIBILITY OF VERY LOW SULPHUR FUEL OILS - GARD
In order to meet increasing restrictions on the sulphur content in marine fuel as defined by MARPOL Annex VI Regulation 14.1.3, the characteristics ...
Monday, 02 December 19
COAL PRODUCTION IN INDIA UP BY 164.58 MT IN 5 YEARS - BUSINESS LINE
Raw coal production in the country has increased from 567.77 million tons (MT) in 2013-14 to 730.35 MT in 2018-19, Union Coal and Parliamentary Aff ...
Monday, 02 December 19
OPEC PREPS FOR OIL'S 2020 BALANCING ACT - WOOD MACKENZIE
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- LBH Netherlands Bv - Netherlands
- Therma Luzon, Inc, Philippines
- Baramulti Group, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Coal and Oil Company - UAE
- Bhatia International Limited - India
- PTC India Limited - India
- Eastern Coal Council - USA
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Bhushan Steel Limited - India
- Rashtriya Ispat Nigam Limited - India
- Ceylon Electricity Board - Sri Lanka
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- London Commodity Brokers - England
- Energy Development Corp, Philippines
- Chamber of Mines of South Africa
- Maharashtra Electricity Regulatory Commission - India
- Posco Energy - South Korea
- Star Paper Mills Limited - India
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Chettinad Cement Corporation Ltd - India
- MS Steel International - UAE
- OPG Power Generation Pvt Ltd - India
- SMC Global Power, Philippines
- Medco Energi Mining Internasional
- VISA Power Limited - India
- Oldendorff Carriers - Singapore
- Ind-Barath Power Infra Limited - India
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- GVK Power & Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- The Treasury - Australian Government
- Global Green Power PLC Corporation, Philippines
- Edison Trading Spa - Italy
- Parry Sugars Refinery, India
- Sakthi Sugars Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Power Finance Corporation Ltd., India
- Leighton Contractors Pty Ltd - Australia
- Holcim Trading Pte Ltd - Singapore
- Karaikal Port Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Merrill Lynch Commodities Europe
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Ambuja Cements Ltd - India
- IHS Mccloskey Coal Group - USA
- Goldman Sachs - Singapore
- Port Waratah Coal Services - Australia
- Planning Commission, India
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Bharathi Cement Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- CNBM International Corporation - China
- Simpson Spence & Young - Indonesia
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Madhucon Powers Ltd - India
- Essar Steel Hazira Ltd - India
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Thiess Contractors Indonesia
- Coastal Gujarat Power Limited - India
- Tata Chemicals Ltd - India
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- White Energy Company Limited
- AsiaOL BioFuels Corp., Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- Interocean Group of Companies - India
- Ministry of Finance - Indonesia
- Bukit Makmur.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- Parliament of New Zealand
- Sical Logistics Limited - India
- Carbofer General Trading SA - India
- Orica Mining Services - Indonesia
- Metalloyd Limited - United Kingdom
- Kaltim Prima Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- IEA Clean Coal Centre - UK
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- Vedanta Resources Plc - India
- Economic Council, Georgia
- Coalindo Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Makarim & Taira - Indonesia
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- Kartika Selabumi Mining - Indonesia
- Energy Link Ltd, New Zealand
- CIMB Investment Bank - Malaysia
- Timah Investasi Mineral - Indoneisa
- Aboitiz Power Corporation - Philippines
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Commonwealth Bank - Australia
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Deloitte Consulting - India
- SN Aboitiz Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Aditya Birla Group - India
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kapuas Tunggal Persada - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- Wilmar Investment Holdings
- GMR Energy Limited - India
- Australian Coal Association
- Altura Mining Limited, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Global Business Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Cement Manufacturers Association - India
- TeaM Sual Corporation - Philippines
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Central Electricity Authority - India
- Romanian Commodities Exchange
- Mercator Lines Limited - India
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Dalmia Cement Bharat India
- Salva Resources Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- Standard Chartered Bank - UAE
- Indika Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- Semirara Mining Corp, Philippines
- Meralco Power Generation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Siam City Cement PLC, Thailand
- Agrawal Coal Company - India
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Sindya Power Generating Company Private Ltd
- Indian Oil Corporation Limited
- San Jose City I Power Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- India Bulls Power Limited - India
- PowerSource Philippines DevCo
- Ministry of Transport, Egypt
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- Straits Asia Resources Limited - Singapore
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
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