International shipping association BIMCO on Wednesday (15 March) published a market report elaborating that the share of ships with scrubbers is expected to increase in the coming years despite a drop in installations:
Scrubbers were installed on 399 ships in 2022, a fall of 24% y/y, and currently 13% of bulker, container, and tanker ships have a scrubber installed. Despite the slowing rate of installations, the share of ships with a scrubber is set to increase in coming years as 17% of ships in the shipyards’ order books are expected to have a scrubber installed.
Since 1 January 2020, ships have had to use ultra or low sulphur fuel (eg ULSFO or VLSFO) to comply with limits for sulphur emissions. However, ships can continue to use the less expensive heavy fuel oil (HFO) if they install a scrubber. But the price premium for VLSFO has turned out to be less than initially estimated.
On 31 December 2019, the day before the new IMO regulation was implemented, the price premium for VLSFO in six of the world’s largest bunkering ports averaged USD 347/tonne. Since then, the premium has averaged USD 149/tonne. It has been as low as USD 50/tonne for an extended period during 2020 and as high as USD 400/tonne during June/July 2022.
The higher the VLSFO premium, the more attractive the investment in a scrubber is because the payback period is shorter. The lower-than-expected VLSFO premium has likely discouraged owners from installing scrubbers, particularly on smaller ships with lower bunker consumption and lower savings as a result.
In fact, the average dry bulk, container, and tanker ship with a scrubber has a deadweight capacity of 140,845 tonnes whereas those without have an average of 51,743 deadweight tonnes. Therefore, the 13% of the dry bulk, container, and tanker ships with scrubbers represents 29% of the deadweight capacity. The crude tanker fleet has the highest installation rate with 32% of the ships and 38% of the deadweight capacity having scrubbers installed.
The percentage of ships with scrubbers is set to increase in the coming years as 17% of the dry bulk, container, and tanker ships in the shipyards’ order books are expected to have scrubbers installed. However, those 17% only amount to 24% of the deadweight capacity in the order book and the scrubber deadweight percentage could therefore decrease.
In the long term, the use of scrubbers to cut sulphur emissions may reduce as decarbonisation efforts will increase the use of alternative fuels that are sulphur compliant.
Photo credit: BIMCO
Published: 16 March, 2023
ScandiNAOS, Chalmers University of Technology and SMA launched a project to develop dual-fuel kits for conversion of new and existing diesel engines to methanol operation.
Initiative is in response to upcoming IMO environmental regulations, the EU Emissions Trading System (ETS), and the paradigm shift in the maritime industry.
‘The primary reason for this is simply an oversupply of the product, especially in Asia, which is the largest exporter in the world, as a region; and insufficient demand to soak up the supplies,’ says Yaw Yan Chong.
Traditional marine fuels during Q3 2020 saw fuel oil sales at 2.0 million mt (1.8 million mt); MGO at 265,151 mt (260,307 mt); and MDO at 189,289 mt (115,034 mt).
BIMCO Bunker Terms 2018 offer a fair balance between the bunker supplier and bunker purchaser, it advises.
Oil tanker detailed on 4 January was carrying a total 170,000 litres of oil products consisting of 100,000 litres of gasoline and 70,000 litres of diesel.
Transferred shares of 40 subsidiaries to BVI firm after tribunal awarded claims in favour of Trinity Seatrading; YSPL has also filed a civil complaint against DNV and Liberian ship registry at Nanjing Maritime Court.
ADNOC L&S, Gulf Energy Maritime, Cockett Marine Oil, Mideast/Bahri Ship Management and VPS experts present their views on biofuel bunker hurdles at the VPS Biofuels Seminar in Dubai on 16 March.
‘Bunker barges operate in very local areas so these vessels call at port very often which means it will be a good fit for women with families,’ states Elpi Petraki, President of WISTA International.
“Our Singapore branch is under preparation and is expected to start business at the republic before June 2023,” Managing Director Darcy Wong tells bunkering publication Manifold Times in an interview.
Development to supply B35 biodiesel blend officially takes effect on 1 February; local bunker suppliers will be able to deliver updated spec within March onwards, once current stocks of B30 avails run out.
VPS, Global Centre for Maritime Decarbonisation, Wilhelmsen Ship Management, and INTERTANKO executives offered a multitude of perspectives to 73 attendees during the VPS Biofuels Seminar, reports Manifold Times.
