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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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Wednesday, 02 April 14
BPI BREAKING BELOW THE 1,000 PSYCHOLOGICAL LEVELS - INTERMODAL
Any resistance put forth by the Dry Bulk market the week prior was succumbed this time round. All indices slid and losses were noted across the ...
Tuesday, 01 April 14
NEWCASTLE PORT SHIPPED 11.95 MILLION TONS OF COAL IN MARCH 2014
COALspot.com: In the week ended 31 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2 ...
Monday, 31 March 14
SHIPPING CONFIDENCE HITS HIGHEST LEVEL SINCE 2008 - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for almost six years in the three-month period to February 2014, ...
Monday, 31 March 14
COAL SWAP FOR Q1 2015 DELIVERY HAS CLOSED 4.76% HIGHER COMPARED Q2 14 CLOSING
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 gained this pa ...
Monday, 31 March 14
CFR SOUTH CHINA COAL SWAP FOR Q2 14 DELIVERY LOST 1.17% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.17 percent month on month and closed at US$ 75.38 per m ...
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- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- Aditya Birla Group - India
- Miang Besar Coal Terminal - Indonesia
- Indian Energy Exchange, India
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Eastern Coal Council - USA
- Eastern Energy - Thailand
- Kobexindo Tractors - Indoneisa
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- Thai Mozambique Logistica
- Coalindo Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Xindia Steels Limited - India
- Renaissance Capital - South Africa
- Directorate Of Revenue Intelligence - India
- TNB Fuel Sdn Bhd - Malaysia
- Kartika Selabumi Mining - Indonesia
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Edison Trading Spa - Italy
- Kideco Jaya Agung - Indonesia
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Wilmar Investment Holdings
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Mines - Canada
- PowerSource Philippines DevCo
- Lanco Infratech Ltd - India
- Timah Investasi Mineral - Indoneisa
- Siam City Cement - Thailand
- Tamil Nadu electricity Board
- Carbofer General Trading SA - India
- Semirara Mining Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- London Commodity Brokers - England
- Sindya Power Generating Company Private Ltd
- Bukit Makmur.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Jorong Barutama Greston.PT - Indonesia
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Bangladesh Power Developement Board
- Energy Link Ltd, New Zealand
- Mintek Dendrill Indonesia
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Romanian Commodities Exchange
- Siam City Cement PLC, Thailand
- Holcim Trading Pte Ltd - Singapore
- ICICI Bank Limited - India
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- SMC Global Power, Philippines
- Marubeni Corporation - India
- Asmin Koalindo Tuhup - Indonesia
- MS Steel International - UAE
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- European Bulk Services B.V. - Netherlands
- Africa Commodities Group - South Africa
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- Barasentosa Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- McConnell Dowell - Australia
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Trasteel International SA, Italy
- Directorate General of MIneral and Coal - Indonesia
- Economic Council, Georgia
- Makarim & Taira - Indonesia
- GAC Shipping (India) Pvt Ltd
- Price Waterhouse Coopers - Russia
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- Global Coal Blending Company Limited - Australia
- Medco Energi Mining Internasional
- Salva Resources Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Uttam Galva Steels Limited - India
- Indian Oil Corporation Limited
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Petron Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- SN Aboitiz Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- Global Business Power Corporation, Philippines
- Thiess Contractors Indonesia
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Agrawal Coal Company - India
- PTC India Limited - India
- Orica Mining Services - Indonesia
- Coastal Gujarat Power Limited - India
- Singapore Mercantile Exchange
- Standard Chartered Bank - UAE
- Manunggal Multi Energi - Indonesia
- Australian Coal Association
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Bulk Trading Sa - Switzerland
- Kalimantan Lumbung Energi - Indonesia
- GMR Energy Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- The University of Queensland
- Deloitte Consulting - India
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- Indika Energy - Indonesia
- Posco Energy - South Korea
- Riau Bara Harum - Indonesia
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Therma Luzon, Inc, Philippines
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Parry Sugars Refinery, India
- Indo Tambangraya Megah - Indonesia
- India Bulls Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meralco Power Generation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sojitz Corporation - Japan
- Essar Steel Hazira Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- Energy Development Corp, Philippines
- Georgia Ports Authority, United States
- Latin American Coal - Colombia
- GN Power Mariveles Coal Plant, Philippines
- Kumho Petrochemical, South Korea
- Aboitiz Power Corporation - Philippines
- Dalmia Cement Bharat India
- Banpu Public Company Limited - Thailand
- Chettinad Cement Corporation Ltd - India
- LBH Netherlands Bv - Netherlands
- Australian Commodity Traders Exchange
- Ind-Barath Power Infra Limited - India
- Intertek Mineral Services - Indonesia
- Minerals Council of Australia
- Kapuas Tunggal Persada - Indonesia
- Parliament of New Zealand
- Bharathi Cement Corporation - India
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Tata Chemicals Ltd - India
- Coal and Oil Company - UAE
- Electricity Authority, New Zealand
- Ambuja Cements Ltd - India
- Mercator Lines Limited - India
- The State Trading Corporation of India Ltd
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- Indogreen Group - Indonesia
- Interocean Group of Companies - India
- Rashtriya Ispat Nigam Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Mercuria Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Borneo Indobara - Indonesia
- Gujarat Sidhee Cement - India
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- New Zealand Coal & Carbon
- Central Java Power - Indonesia
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Ceylon Electricity Board - Sri Lanka
- Central Electricity Authority - India
- Metalloyd Limited - United Kingdom
- SMG Consultants - Indonesia
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Jindal Steel & Power Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Rio Tinto Coal - Australia
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