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Monday, 14 July 14
THE END OF THE ERA OF HEAVY FUEL OIL IN MARITIME SHIPPING - ICCT
 KNOWLEDGE TO ELEVATE
Since the 1960s, heavy fuel oil (HFO) has been the king of marine fuels. Viscous, dirty, yet inexpensive and widely available, HFO propelled a long period of robust growth in international shipping, which carries over 90% of intercontinental trade by volume each year. For many, it is the lifeblood of the maritime shipping industry.
But HFO’s low price does not reflect its impacts on the environment and human health. The sulfur content of HFO can be up to 35,000 parts per million. It is the reason that maritime shipping accounts for 8% of global emissions of sulfur dioxide (SO2), making the industry an important source for acid rain as well as respiratory diseases. In some populous port cities, such as Hong Kong, shipping is the largest single source of SO2 emissions as well as emissions of particulate matter (PM), which are directly tied to the sulfur content of fuel. By one estimate, PM emissions from maritime shipping led to 87,000 premature deaths worldwide in 2012.
The International Maritime Organization (IMO), the governing body of international shipping, has made a decisive effort to diversify the industry away from HFO into cleaner fuels with less harmful effects on the environment and human health. Effective in 2015, ships operated within the Emission Control Areas (ECAs) covering the Economic Exclusive Zone of North America, the Baltic Sea, the North Sea, and the English Channel will begin to use Marine Gas Oil (MGO) with allowable sulfur content up to 1,000 ppm. Starting from 2020, ships sailing outside ECAs will switch to Marine Diesel Oil (MDO) with permitted sulfur content up to 5,000 ppm.*
That tectonic shift also creates openings for a variety of new fuels. Liquefied nature gas (LNG), newly abundant and relatively affordable, is attracting the attention of many shipping companies. Although the lack of infrastructure and the uncertainty of future prices have slowed the “dash to gas,” many expect LNG to establish itself as one of major alternatives to HFO in the future. Lloyds Registry, a shipping classification society, expects LNG to take 11% of the market share in 2030.
Meanwhile, Stena Teknik, a Swedish company, is testing methanol, another natural gas product, but one that requires less storage space in a ship and is relatively easier to handle. While natural gas-based fuels may sometimes offer questionable climate benefits, due to methane leakage concerns, the IMO’s low-sulfur regulation may create needed openings for other zero-sulfur, low-carbon marine fuels. Tests using fuel cells on the Viking Lady, an offshore supply ship, demonstrated promising results.
Wind kites and solar panels have already been installed on numerous ships to supplement marine diesel engines. Even HFO will not completely disappear from the menu of marine fuels. Combined with scrubbers that capture more than 99% of the sulfur from the exhaust gas, HFO will continue to play an important role. Lloyds Registry reckons that HFO will represent about 40% of fuel use by 2030.
The shift to cleaner but pricier low-sulfur fuels is likely to heighten interest in the “fifth fuel”: energy efficiency. Historically, the maritime shipping industry, where energy often accounts for over half of operating costs, has responded to escalating fuel prices with innovative energy-saving strategies. To cite a recent example: in 2008, as fuel prices went through the roof, shipping lines cut their operating speeds by as much as 50%, helping many companies stay afloat amid one of the worst downturns in history. In an analysis of satellite data on ship operations, we’ve estimated that the industry can further slash 100 million ton of fuel use by 2030 through wider implementation of energy-saving measures that were adopted by industry leaders in 2011.
This is in addition to savings of 90 million tons of fuel because of the Energy Efficiency Design Index (EEDI), a mandatory program that will require new ships to achieve certain efficiency targets beginning in 2015.
The continued diversification of marine fuels and improvements in energy efficiency have important implications. First and foremost, they may alleviate concerns about the availability of low-sulfur fuels. Figure 1 illustrates one possible scenario, using our forecast on future marine fuel consumption and energy efficiency improvements as well as Lloyds Registry’s estimate of market shares for HFO and LNG. The efficiency improvement of the legacy fleet is the greatest force driving down the need for low-sulfur fuels, equivalent to adding about 110 “negatons” of fuel, or almost 24% of projected demand. HFO combined with scrubbers, EEDI, and distillates (MGO plus MDO) are almost neck and neck, each representing about 20% of fuel use in the chart. LNG is coming of age, with its share doubling between 2020 and 2030. Other fuels, such as renewables, fuel cells, and biofuels, are expected to hold only small market shares in 2030.
Second, the new fuels are on a collision course with IMO safety regulations concerning flashpoint, the temperature at which a fuel can vaporize to form an ignitable mixture in air.
The IMO currently requires marine fuels to have a minimum flashpoint of 60°C. But low-sulfur fuels have a lower flashpoint (50° to 55°C), meaning that they are “off-spec” and cannot be used under the IMO rule. The flashpoint requirement, which went into effect in 1976, was meant to provide a large margin of error to ensure the temperature of the engine room (normally below 45°C) does not exceed the flashpoint in any circumstance. But according to industry heavyweights such as Maersk and BIMCO, modern technologies such as advanced ventilation systems provide an adequate safety margin, and they argue that keeping the flashpoint requirement will cause the industry to miss the opportunity represented by the increased availability of low-sulfur, low-flashpoint fuels. Industry and member states such as the U.S. are urging the IMO to accelerate its consideration of an amendment to the flashpoint requirement.
By: Haifeng Wang / The International Council of Clean Transportation
*Implementation of the requirement is subject to a review of fuel availability to be completed by 2016.
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Thursday, 12 June 14
CONSOLIDATION IS THE ' NAME OF THE GAME' WHEN IT COMES TO SHIPYARDS ACROSS ASIA - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Intense competition, a swelling of new greenfield shipyards over the past few years mainly in China, especially prior to the 2008 global financial ...
Wednesday, 11 June 14
INDONESIA'S COAL EXPORT VOLUME AND REVENUE SLIPS 2.75% AND 6.73% RESPECTIVELY IN APRIL
COALspot.com: Indonesia, one of the world's largest coal producer and the global largest multi grade coal exporter shipped around $1.8* b ...
Wednesday, 11 June 14
BPI TOUCHING A NEW LOW FOR THE YEAR
The Dry Bulk market closed off the week positively, on the back of firming Capesize rates, while the market overall continues to face a very challe ...
Monday, 09 June 14
GOVT GETS TOUGH ON ILLEGAL MINING, SUSPENDS LICENSES - THE JAKARTA POST
The government has temporarily suspended the licenses of 62 mineral and coal transportation companies as part of its efforts to curb illegal mining ...
Monday, 09 June 14
INDO SUB-BIT COAL SWAPS FOR Q3,Q4 OF 2014 AND Q1 2015: LOST ON DAY AND MONTH
COALspot.com: Indonesian coal swaps for average Q3’ 2014 continue last week’s trend or lost on day, week and on month according to Asia ...
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- Riau Bara Harum - Indonesia
- Indian Oil Corporation Limited
- Petrochimia International Co. Ltd.- Taiwan
- Heidelberg Cement - Germany
- Merrill Lynch Commodities Europe
- Trasteel International SA, Italy
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Straits Asia Resources Limited - Singapore
- Star Paper Mills Limited - India
- Directorate General of MIneral and Coal - Indonesia
- The Treasury - Australian Government
- Energy Link Ltd, New Zealand
- Bayan Resources Tbk. - Indonesia
- Standard Chartered Bank - UAE
- Sindya Power Generating Company Private Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Bulk Trading Sa - Switzerland
- Bhatia International Limited - India
- Mercator Lines Limited - India
- San Jose City I Power Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Sical Logistics Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Meenaskhi Energy Private Limited - India
- Simpson Spence & Young - Indonesia
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- Toyota Tsusho Corporation, Japan
- Tamil Nadu electricity Board
- Antam Resourcindo - Indonesia
- The University of Queensland
- Ministry of Finance - Indonesia
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- White Energy Company Limited
- Siam City Cement - Thailand
- PetroVietnam Power Coal Import and Supply Company
- CIMB Investment Bank - Malaysia
- Cement Manufacturers Association - India
- International Coal Ventures Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Dalmia Cement Bharat India
- Karbindo Abesyapradhi - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- Xindia Steels Limited - India
- VISA Power Limited - India
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Makarim & Taira - Indonesia
- Bharathi Cement Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Mjunction Services Limited - India
- Indo Tambangraya Megah - Indonesia
- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- McConnell Dowell - Australia
- SMG Consultants - Indonesia
- MS Steel International - UAE
- Intertek Mineral Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- Indian Energy Exchange, India
- Sojitz Corporation - Japan
- Chamber of Mines of South Africa
- Uttam Galva Steels Limited - India
- Banpu Public Company Limited - Thailand
- Ministry of Mines - Canada
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- Sinarmas Energy and Mining - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Global Green Power PLC Corporation, Philippines
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Renaissance Capital - South Africa
- ASAPP Information Group - India
- Maheswari Brothers Coal Limited - India
- Bhoruka Overseas - Indonesia
- Romanian Commodities Exchange
- Wilmar Investment Holdings
- India Bulls Power Limited - India
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- Kohat Cement Company Ltd. - Pakistan
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Singapore Mercantile Exchange
- LBH Netherlands Bv - Netherlands
- Kartika Selabumi Mining - Indonesia
- Kumho Petrochemical, South Korea
- Kaltim Prima Coal - Indonesia
- Wood Mackenzie - Singapore
- Indika Energy - Indonesia
- Baramulti Group, Indonesia
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- Ministry of Transport, Egypt
- Central Java Power - Indonesia
- Medco Energi Mining Internasional
- Agrawal Coal Company - India
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Georgia Ports Authority, United States
- Coastal Gujarat Power Limited - India
- Semirara Mining Corp, Philippines
- Mercuria Energy - Indonesia
- Planning Commission, India
- Coal and Oil Company - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Economic Council, Georgia
- Central Electricity Authority - India
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- AsiaOL BioFuels Corp., Philippines
- GN Power Mariveles Coal Plant, Philippines
- Kapuas Tunggal Persada - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Sarangani Energy Corporation, Philippines
- Parliament of New Zealand
- GMR Energy Limited - India
- Indogreen Group - Indonesia
- Siam City Cement PLC, Thailand
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- London Commodity Brokers - England
- Marubeni Corporation - India
- Anglo American - United Kingdom
- Latin American Coal - Colombia
- Port Waratah Coal Services - Australia
- PTC India Limited - India
- Madhucon Powers Ltd - India
- Minerals Council of Australia
- Africa Commodities Group - South Africa
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Price Waterhouse Coopers - Russia
- ICICI Bank Limited - India
- Aboitiz Power Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Posco Energy - South Korea
- Australian Coal Association
- Malabar Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Sakthi Sugars Limited - India
- Karaikal Port Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- Indonesian Coal Mining Association
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Globalindo Alam Lestari - Indonesia
- Orica Australia Pty. Ltd.
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- GAC Shipping (India) Pvt Ltd
- Independent Power Producers Association of India
- IEA Clean Coal Centre - UK
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- PowerSource Philippines DevCo
- New Zealand Coal & Carbon
- Attock Cement Pakistan Limited
- Holcim Trading Pte Ltd - Singapore
- Goldman Sachs - Singapore
- GVK Power & Infra Limited - India
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- South Luzon Thermal Energy Corporation
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