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Thursday, 02 January 20
SULPHUR 2020 COMPENDIUM - HOW ARE INDIVIDUAL PORT STATES EXPECTED TO REACT? - STANDARD CLUB
 KNOWLEDGE TO ELEVATE
With the new sulphur limits soon to be in force, Standard Club has been investigating the ways in which certain jurisdictions are expected to react to violations.
We contacted our local correspondents from a variety of different ports, including Brazil, China, Denmark, Norway, Panama, Spain and Sweden, to build a compilation of what we believe is useful and practical knowledge for dealing with future sulphur claims.
We asked our correspondents the following series of questions:
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Will compliant bunkers be available in your jurisdiction?
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Which government body or organisation issues fines for sulphur violations?
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What is the estimated potential value of fines?
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Is there a possibility of criminal action for sulphur violations?
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Can a ship be detained for violations? If so, will a club LOU be accepted to secure its release?
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Is it possible to appeal fines?
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What contingency measures are available for ships carrying non-compliant fuel?
The answers to these questions are as follows. If you have questions about any of these jurisdictions, or any jurisdictions which are not listed below, please contact your usual claims handler at the club for further assistance.
Brazil
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Compliant bunkers will be available in Salvador, Sao Luis, Belem and Macapa.
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Fines may be issued by the ANP, IBAMA (the Environmental Authority) or the Harbour Master´s Office at each port.
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The estimated potential fines range from BRL 5,000 to BRL 2,000,000.
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There is a possibility of criminal action for sulphur violations in Brazil.
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A ship may be detained for sulphur violations until it is proved that there are bunkers within specification on board. Acceptance of a club LOU will depend on each individual case.
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It is possible to appeal fines.
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In the event of non-compliance, the Authorities will need to verify that the off-spec bunkers have been segregated on board.
China
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Compliant bunkers should be available in China. However, members should check with local agents and the port authority before calling to confirm availability.
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The local marine authority (the MSA) issues fines for sulphur violations.
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According to the PRC Air Pollution Prevention and Control Law, shipowners may face administrative penalties ranging from RMB10,000 to RMB100,000.
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While this is unlikely, there is a possibility for criminal action in the event of serious violations.
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Ships can be detained, depending on the seriousness of the violation. It is not known whether a club LOU would be accepted.
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Appeals of fines are unlikely to be successful if a violation has in fact occurred. However, owners may apply for a review of the fine if they suspect that the administrative procedures have been incorrectly applied (i.e. there has been no violation).
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From 1 January 2020 if a ship is unable to obtain compliant bunkers she should submit a FONAR to the MSA before entering Chinese waters. From 1 March 2020 if a ship is carrying non-compliant bunkers in Chinese waters they can discharge the non-compliant bunkers, or (subject to MSA approval) retain the non-compliant bunkers on board after providing a letter of commitment not to use these bunkers in Chinese waters.
Denmark
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Compliant bunkers will be available in Denmark.
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The Port State Control and the police both administer fines for sulphur violations.
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Fines for non-compliance can range from DKK 30,000 to DKK 300,000.
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Criminal action may in some cases be brought for non-compliance. Fines are imposed by the police, following penalty proceedings and public court hearings. In cases of gross negligence, or of continuous violation of the sulphur cap, there is the possibility of imprisonment for up to two years.
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A ship can be detained until it has taken the necessary steps to ensure compliance with the sulphur content regulations. Club LOUs will not be accepted to secure release of the ship.
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Fines can be appealed through the usual judicial channels (at the Court of Appeal and potentially at the Supreme Court).
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If the ship is not compliant with the sulphur regulations, it will be asked by officials to demonstrate that it has taken adequate steps to be compliant. The owner will have to demonstrate that they have established procedures on board the ship to ensure compliance. The owner will also have to provide documentation showing their attempts to obtain compliant bunkers.
Norway
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Compliant bunkers will be available in Norway.
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The Norwegian Maritime Authority (Sjøfartsdirektoratet) issues fines for violations.
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The lowest possible fine is around NOK 79,886. Fines are typically around NOK 250,000, although this figure may be higher depending on the degree of negligence and/or guilt.
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Criminal action may be brought for violations.
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Arrest of the ship for violation of the sulphur limits is possible.
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It is possible to appeal fines to the Norwegian Ministry of Climate and Environment.
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In the event of non-compliance, compliant bunkers are available so that the non-compliant bunkers can be replaced.
Panama
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Compliant bunkers will be available in Panama.
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Fines will be administered by the Panama Maritime Authority (PMA) and the Panama Canal Authority (PCA).
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The PMA and PCA will calculate fines based on the perceived seriousness of the violation. To date, there have been no known fines by the PMA or PCA, so it is difficult to say how they will deal with these incidents.
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Currently there have not been any known criminal proceedings relating to sulphur violations.
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A ship can be detained by both the PMA and PCA for violations, although this is seen to be unlikely. The PMA has in the past been vague regarding club LOU’s but the PCA regularly accepts them for other issues.
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Administrative fines are generally unappealable.
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There are limited options for ships to debunker non-compliant fuel at Panama.
Spain
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Compliant bunkers will be available in Spain.
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The Spanish Central Government Authority issues fines for sulphur violations. The Harbour Master’s office belongs to Merchant Marine General Management, which itself belongs to the Government Ministry in charge of public work.
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There is no set figure for fines. Fines are usually around EUR 22,000 although they could be as high as EUR 180,000. In case of wilful actions, the fine could be as high as EUR 600,000. The Harbour Master will ask for a guarantee to permit the ship to sail (club LOUs are not accepted).
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In theory there is a possibility of criminal action, but only if the use of off-spec bunkers was deliberate.
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A ship can be detained for sulphur violations. In such a case, a club LOU will not be accepted. Authorities will only accept a cash deposit, a bond or a bank security issued by a Spanish Insurer or Bank.
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It is possible to appeal fines, but success is unlikely.
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Any non-compliant bunkers on board will be banned, even if not in use, and similar sanctions will be imposed unless the ship has a scrubber in good operational condition. In addition to the sampling of storage tanks, evidence of tank cleaning and a bunker delivery note will also be required on board.
Sweden
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Compliant bunkers will be available in Sweden.
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The Coast Guard will issue fines for sulphur violations.
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The estimated value of fines is still under discussion. However, there is a risk that fines may be high value to deter non-compliance with the sulphur limits.
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There are not expected to be any criminal repercussions for non-compliance, only fines.
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In very extreme cases, ships can be detained for sulphur violations. It is difficult to predict whether the authorities will accept a club LOU in this situation.
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It is possible to appeal fines.
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In the event of non-compliance, there are many well established bunker operators in the region who can handle non-compliant bunkers.
Source: Standard Club
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Saturday, 01 February 20
THERMAL COAL MARKETS: 5 TRENDS TO WATCH OUT FOR IN 2020 - MINING REVIEW
The seaborne thermal coal market entered the year challenged by low priced LNG in the Atlantic and rapidly increasing supply in the Pacific.
&n ...
Saturday, 01 February 20
COAL IS NOT GOING ANYWHERE - MINING REVIEW
The coal sector is living under the constant threat of being blamed by environmentalists as being responsible for a world disaster called global wa ...
Saturday, 01 February 20
CIL PRODUCTION TO NOT EXCEED 640 MILLION TON IN FY20: OFFICIAL - PTI
Hit by disruptions due to a prolonged monsoon, mining major Coal India Ltd’s production in the current fiscal will not exceed 640 million ton ...
Saturday, 01 February 20
WHO PAYS FOR IMO 2020? - FREIGHT WAVES
The United Nations’ International Maritime Organization (IMO) implemented its low-sulfur fuel mandate on January 1, 2020. Full enforcement be ...
Friday, 31 January 20
EIA EXPECTS U.S. ELECTRICITY GENERATION FROM RENEWABLES TO SOON SURPASS NUCLEAR AND COAL
In the latest long-term projections, the U.S Energy Information Administration (EIA) projects electricity generation from renewable sources such as ...
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- Global Coal Blending Company Limited - Australia
- Electricity Generating Authority of Thailand
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Edison Trading Spa - Italy
- GVK Power & Infra Limited - India
- Indian Energy Exchange, India
- Formosa Plastics Group - Taiwan
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Ministry of Mines - Canada
- San Jose City I Power Corp, Philippines
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Meenaskhi Energy Private Limited - India
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- The University of Queensland
- Parry Sugars Refinery, India
- Wilmar Investment Holdings
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Orica Australia Pty. Ltd.
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Finance - Indonesia
- Karaikal Port Pvt Ltd - India
- Australian Coal Association
- Thiess Contractors Indonesia
- Chettinad Cement Corporation Ltd - India
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Indo Tambangraya Megah - Indonesia
- Directorate Of Revenue Intelligence - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- Bulk Trading Sa - Switzerland
- Carbofer General Trading SA - India
- Anglo American - United Kingdom
- VISA Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Riau Bara Harum - Indonesia
- Rio Tinto Coal - Australia
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- South Luzon Thermal Energy Corporation
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Eastern Coal Council - USA
- Bangladesh Power Developement Board
- Maheswari Brothers Coal Limited - India
- Orica Mining Services - Indonesia
- Planning Commission, India
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Baramulti Group, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- India Bulls Power Limited - India
- SMG Consultants - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Renaissance Capital - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- IHS Mccloskey Coal Group - USA
- Vijayanagar Sugar Pvt Ltd - India
- Goldman Sachs - Singapore
- Miang Besar Coal Terminal - Indonesia
- Latin American Coal - Colombia
- Antam Resourcindo - Indonesia
- Ambuja Cements Ltd - India
- Central Java Power - Indonesia
- CNBM International Corporation - China
- Indogreen Group - Indonesia
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Deloitte Consulting - India
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indika Energy - Indonesia
- Central Electricity Authority - India
- Savvy Resources Ltd - HongKong
- Sical Logistics Limited - India
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Wood Mackenzie - Singapore
- Uttam Galva Steels Limited - India
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Bhatia International Limited - India
- Krishnapatnam Port Company Ltd. - India
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- McConnell Dowell - Australia
- Electricity Authority, New Zealand
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Indian Oil Corporation Limited
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- CIMB Investment Bank - Malaysia
- Cement Manufacturers Association - India
- ASAPP Information Group - India
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Thai Mozambique Logistica
- Chamber of Mines of South Africa
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SN Aboitiz Power Inc, Philippines
- Makarim & Taira - Indonesia
- Merrill Lynch Commodities Europe
- Vedanta Resources Plc - India
- Sarangani Energy Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bukit Baiduri Energy - Indonesia
- SMC Global Power, Philippines
- Ministry of Transport, Egypt
- Singapore Mercantile Exchange
- Binh Thuan Hamico - Vietnam
- Samtan Co., Ltd - South Korea
- Medco Energi Mining Internasional
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- Posco Energy - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Star Paper Mills Limited - India
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Parliament of New Zealand
- Eastern Energy - Thailand
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- White Energy Company Limited
- Cigading International Bulk Terminal - Indonesia
- Commonwealth Bank - Australia
- Bukit Makmur.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Marubeni Corporation - India
- Lanco Infratech Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Mjunction Services Limited - India
- Tata Chemicals Ltd - India
- Kaltim Prima Coal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercuria Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Jindal Steel & Power Ltd - India
- Salva Resources Pvt Ltd - India
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Siam City Cement - Thailand
- Oldendorff Carriers - Singapore
- Karbindo Abesyapradhi - Indoneisa
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