ICS Disappointment at IMO Fuel Study

Press Release
Wednesday, October 03, 2012
ICS Secretary General, Peter Hinchliffe

Switch to Low Sulphur Fuel has Implications for Shore Based Industry Too says ICS.


The International Chamber of Shipping (ICS), whose member national shipowners’ associations represent more than 80% of the world merchant fleet, has expressed disappointment and concern at a decision by the International Maritime Organization (IMO) to reject its call to accelerate a critical study into the global availability of low sulphur fuel for ships.


A small majority of IMO Members States, led by the United States, rejected an ICS submission to the IMO Marine Environment Protection Committee (MEPC), which was debated this week in London. Nevertheless, the IMO vote was very close indeed. As well as having the support of major shipping nations such as China and several open registers, ICS was supported by some EU Member States.


ICS was pressing for IMO to start work without further delay on a comprehensive fuel availability study that could consider the impact of all the changes required by the new MARPOL Annex VI regime, to reduce atmospheric pollution, before it is too late for the oil refining industry to respond and invest.


Shipowners are worried about whether sufficient fuel will be available to allow ships to comply with the strict IMO regulations on sulphur emissions and whether, as a result of insufficient supply, the costs for those ships that are able to obtain the required fuels might be prohibitively expensive. In some trades this could lead to significant modal shift to shore based transport, with negative consequences for congestion and the environment. These are issues that were not anticipated when the regulations were agreed.


Speaking after the vote at the IMO MEPC, ICS Secretary General, Peter Hinchliffe remarked: “Some governments still appear to have their heads in the sand with respect to fuel availability. What will be the impact of ships switching to distillate on the availability of diesel for road transport or heating oil for homes? We still think it’s essential that a global fuel study is carried out sufficiently in advance of 2020 to give the refiners adequate time to invest and react. The major refinery upgrading required could take a minimum of four or five years, perhaps longer, and we believe that completing the study in 2018 would simply be too late.”

ICS argues that the need to move forward the IMO study is more important than ever, especially as the EU has already decided that it will definitely implement the 0.5% sulphur requirements in 2020, even if the IMO study results suggest, as permitted by MARPOL, that full implementation should be postponed until 2025.“ICS has not given up, and we will bring the issue back to IMO next year” said Peter Hinchliffe. “The issue is just too important. The enormity of the switch to distillate and its economic impact on shipping, and indeed the world economy as whole, should not be underestimated or swept under the carpet.”


ICS emphasises that when the global requirement to switch to distillate was adopted in 2008, ICS supported the agreed IMO timetable as an acceptable compromise.However, if the switch to low sulphur fuel is to be successful, ICS believes that those governments that advocated such ambitious goals need to do everything possible to assure themselves and the industry that the refineries are able to deliver. ICS still believes this means undertaking the required studies of fuel availability as soon as possible.


There is already a formal mechanism in MARPOL Annex VI for IMO to complete a review, by 2018, of progress made towards meeting the demand for 0.5% sulphur fuel that must be used globally outside of Emission Control Areas (ECAs) by 2020 or 2025. However, ICS had suggested that a preliminary IMO study of the availability of compliant fuel, taking into account the introduction of the 0.1% sulphur in fuel requirements to be used in the Baltic Sea, North Sea and the North American ECAs in 2015, would provide a suitable test case. Such a study would provide a projection of possible scenarios resulting from the introduction of the 2015 0.1% ECA standard, against the background of the world market. This could then be considered in comparison with the real situation encountered in 2015.


Fuel is by far the largest operational cost for shipowners and has already increased in price by about 400% since 2000. However, the current 50% price differential between low sulphur distillate and the residual fuel oil that is currently in use is predicted to increase yet further if the new demand that will be created by the MARPOL requirements is not matched by increased supply.

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter May 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Costa Concordia Captain's Sentence Upheld

The prison sentence against the former captain of the Costa Concordia cruise liner for his role in the deadly 2012 shipwreck was upheld on Tuesday by an Italian court.

Partners Target Improved Maritime Efficiency

On May 25, 2016, The University of the West Indies Arthur Lok Jack Graduate School of Business (UWI-ALJGSB) together with the Trinidad and Tobago Shipbuilding &

MSHS Group President Recognized for Safety Leadership

Signal Mutual Indemnity Association, a self-insured group provider of Longshore benefits, presented MSHS President Are Friesecke with the Francis R. Sharp Executive

Marine Propulsion

ABB Software to Monitor Cosco Heavy Transport Fleet

ABB, a power and automation technology group, will supply its onboard motion monitoring and forecasting system to the Xiang Rui Kou heavy lift vessel, meaning the

New Norsafe Boat with Diesel Outboards Debuts

Norsafe launched a new boat, the Marathon 900 RIB, the company's first RIB complementing an already wide range of boats for professional and military customers.

Wärtsilä Electrical Systems for SIEM RoRo Ferries

Wärtsilä has been awarded the contract to provide integrated turnkey electrical solutions for four new RoRo ferries being built at the Flensburger Schiffbau-Gesellschaft (FSG) yard in Germany.

Environmental

First German-Latvian Maritime Forum in Riga

On 19 May, Ziemelblazma Culture Palace in Riga, the Latvian capital was the venue for a meeting between numerous representatives of the Ports of Liepaja, Riga, Ventspils, Lübeck, Kiel and Hamburg.

Trim Optimization – Saving Fuel on Offshore Supply Vessels

A joint development project (JDP) between DNV GL, Statoil and Farstad Shipping has demonstrated that offshore supply vessels (OSV) can save up to 21,000 Euros on their annual fuel bill,

The Impact of Hull Form on Efficiency

There is a growing interest in the fuel efficiency of ships because of fuel prices, climate change and energy security issues. This has resulted in, amongst other things,

Fuels & Lubes

KTB Joins the KPI Bridge Oil Group

KPI Bridge Oil, a global trader and broker in marine fuels, marine lubricants and risk management products, has announced that KTB will become a member of the KPI Bridge Oil Group as of June 1, 2016.

Asian Traders Unload Floating Gasoline as Market Flips

Gasoline shifted from tankers to landed storage or sold off; forward gasoline prices to flip to backwardation from July. The number of tankers storing gasoline

Trim Optimization – Saving Fuel on Offshore Supply Vessels

A joint development project (JDP) between DNV GL, Statoil and Farstad Shipping has demonstrated that offshore supply vessels (OSV) can save up to 21,000 Euros on their annual fuel bill,

Marine Power

ABB Software to Monitor Cosco Heavy Transport Fleet

ABB, a power and automation technology group, will supply its onboard motion monitoring and forecasting system to the Xiang Rui Kou heavy lift vessel, meaning the

Wärtsilä Electrical Systems for SIEM RoRo Ferries

Wärtsilä has been awarded the contract to provide integrated turnkey electrical solutions for four new RoRo ferries being built at the Flensburger Schiffbau-Gesellschaft (FSG) yard in Germany.

MAN 28/33D STC Engines for Thai Navy’s New OPV

The Royal Thai Navy has ordered a new 90-m offshore patrol vessel (OPV) to be constructed at Mahidol Adulyadej naval dockyard in Sattahip.  The newbuilding, an improved River-class design,

Government Update

EU Ships in Libyan Waters Would Undermine Tripoli Govt

The U.N.-backed government in Libya has not invited European ships into its territorial waters to help stop people smuggling because this could harm efforts to

Striking Port Workers Protest Greek Port Sales

Greek port workers walked off the job for a sixth day on Tuesday and marched through central Athens to protest the state-sanctioned selloff of the country's two largest ports,

Bulgaria, Greece to Consider Greek LNG terminal

Bulgarian state energy holding company BEH and Greek natural gas company Gastrade have set up a joint task force to prepare a proposal to build an off-shore liquefied

 
 
Maritime Contracts Maritime Standards Navigation Offshore Oil Pipelines Pod Propulsion Port Authority Salvage Ship Repair Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1579 sec (6 req/sec)