Copenhagen-listed shipowner TORM on Monday (1 March) reported not all ports allowing the use of 3.5% HFO with scrubbers for its EGCS-equipped vessels.
As such, its solution is to move from using two bunker fuel types onboard scrubber-equipped ships to five different fuel types.
To date, the company has installed 46 scrubbers. The remaining four are expected to be installed in 2021 and the first quarter of 2022, including the two scrubbers for the LR2 newbuildings.
In 2020, TORM acquired two second-hand vessels and made additional purchases of two fuel-efficient, dual-fuel ready LR2 newbuildings with scrubbers.
TORM said it has already formed a successful partnership with a scrubber producer, supporting the company’s scrubber investments.
A comprehensive study for the company by an independent specialist which compared the emissions from vessels fitted with exhaust gas cleaning systems (scrubbers) to emissions from vessels using low-sulfur fuel found that the sulfur emissions are reduced to an average of just 0.025% when using the exhaust gas cleaning system compared to 0.45% when using low sulfur fuel.
TORM has obtained financing of USD 12m related to the installation of scrubbers and Ballast Water Treatment Systems on four vessels. Following the refinancing, TORM does not have any material debt maturities until 2026, which supports the company’s financial flexibility.
The company reported profit before tax in 2020 to be USD 90 million, compared to USD 202 million in 2019.
Photo credit: TORM
Published: 2 March, 2021
Study acknowledges scrubbers are effective at reducing air emissions of SO2, however the contaminants are dumped overboard in the form of washwater.
The company is also planning to consolidate its marine sales division due to COVID-19 and the narrowing bunker fuel price spread, says its CEO.
Although gas scrubbers are considered acceptable to meet IMO2020’s SOx emission rules, it is not globally accepted in all states.
Captures differentials of compliant and high sulphur fuel; ‘significantly de-risking initial investment’, says CEO.
Bunker fuel prices have been unstable since the implementation of IMO 2020 and with it, the premium for scrubber-fitted bulk carriers, says shipbroking firm.
‘This is expected to delay the payment of between USD 20.0 million and USD 25.0 million of expenditures until 2021 at the earliest,’ reads company report.
The Covid-19 pandemic in India, where the group’s assets of between USD 45 to 60 million, accounting, and reporting capabilities are located have affected expected pace of restructuring ops, explains legal team.
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