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Teekay prepares for 2020 sulphur cap compliance

19 Mar 2018

New York-listed marine energy transportation, storage and production company Teekay Shipping Corporation is well in the way of preparing itself for the upcoming 2020 sulphur cap, says its Regional Commercial Operations Manager, Pacific.

“The majority of Teekay’s vessels will be running on distillates by 2020,” Ashley Noronha told delegates at the IBIA Asia Bunker Symposium on Thursday.

Shipowners, will have to put a lot of thought into respective sulphur emissions compliance strategies by 2020

“To date, less than 1% of commercially registered vessels are operating within future regulatory limits for 2020 when operating in open ocean areas, outside the currently existing ECA areas.,” he said.

“We are all bracing ourselves and it is probably going to be one of the biggest regulatory changes we see in our times. The question is: What are most owners doing? Of course every owner will like to be optimally positioned to have a strategic advantage.

“Depending on what route an owner takes it does involve a substantial amount of investment; what doesn’t make matters very easy is that owners have not been laughing their way to the bank with bags full of money.

“Markets haven’t been the best. The freight rates are pretty much rock bottom and in addition to the sulphur requirements another big ticket item is the ballast water management system together with other smaller regulatory changes in the near future.”

Noronha forecasts only a small percentage of vessels will be fitted with scrubbers by 1 January, 2020; a scrubber will take between four to six weeks to install and owners will further need to secure contracts for high sulphur fuel oil for vessels sailing particular routes.

The consumption of hybrid fuels is affected by compatibility and stability issues; these types of fuel cannot be mixed even though similar grades are available at other ports, and avails will be subjected to trading routes.

Most ships have between four to five tanks to store marine fuel. Ships with a larger number of bunker tanks will have an advantage in terms of segregating different grades of fuel. 

“Irrespective what owners choose there will be a lot of work to prepare for 2020,” he concludes.

The IBIA Asia Bunker Symposium is held as part of Asia Pacific Maritime 2018.

Photo credit: Teekay
Published: 19 March, 2018

 

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