** Sagar Sandesh print version ceases to be published from December 31, 2017. New look E-paper would be available from Jan. 1, 2018 onwards. free of cost.**

More carriers for scrubbers, LNG

More shipping companies are ordering scrubbers or equipping their ships so that they can use liquefied natural gas as fuel in order to meet the requirements by the International Maritime Organization to reduce sulfur in ship engine emissions.   
    Starting Jan. 1, 2020, the IMO will require shipowners to either use fuel with a sulfur content of 0.5 percent or less (down from 3.5 percent today) or remove sulfur from their engine exhaust using an exhaust gas cleaning system or scrubber, as they are popularly known.    

According to Don Gregory, director of the Exhaust Gas Cleaning Systems Association (EGCSA), the scrubber manufacturers that are members of his organization indicate that by 2020 there will be about 2,000 ships with scrubbers installed and more on order.   

The pace of ordering has picked up in the past three or four months, he said.   

 Ships equipped with scrubbers can command a better charter rate because they will be able to continue to use high-sulfur fuel, which costs less than fuel with low sulfur content.  

Andrew Abbott, the CEO of Atlantic Container Line (ACL) which has been using scrubbers said the scrubbers have performed well and should pay for themselves in three years — perhaps sooner because of the widening price difference between high- and low-sulfur fuel.    

 He noted that because ACL was building new ships, installing scrubbers was simpler than it is in some retrofits.   

 Scrubbers can be either “open-loop” systems in which the sulfur is neutralized with seawater or “closed-loop” systems in which exhaust is washed and neutralized with a sodium hydroxide solution.  

 Wartsila, another scrubber manufacturer, explained that closed loop systems are best suited for full-time operation in low alkalinity areas such as the Great Lakes. 
    EGCSA said that its last survey found 63 percent of scrubbers its members reported as being on order as of May 31 were open-loop systems.   

Abbott explained that ACL had opted for a hybrid scrubber that can be used as an open-loop system when on the ocean and a closed-loop system in areas close to shore.   

LNG bunkers also are gaining ground with the shipowners.

 Steve Esau, the general manager of SEA\LNG, said there also is growing interest in using LNG bunkers, driven both by the new IMO 2020 regulation and the existing requirement to use fuel with a sulfur content of 0.1 percent in sulfur “emission control areas” (ECAs) established by the IMO several years ago.
   These include waters within 200 miles of most of the coastline of the United States as well as parts of the Canadian coastline, Caribbean, Baltic Sea and North Sea.    

  Many of the initial orders for LNG-fueled ships came from companies operating vessels in ECAs or on fixed routes. For example Tote Maritime, Crowley, Pasha Hawaii and Matson are among the companies that are operating or building LNG-powered or LNG-ready ships. These Jones Act carriers operate in fixed loops between the U.S. mainland and Puerto Rico or the U.S. mainland and Hawaii.
   The cruise industry was also an earlier adopter of both scrubbers and, more recently, LNG-fueled ships.  

  But Esau said there is growing interest among shipowners with vessels that ply deep-sea routes. This is partly because of an increase in the number of ports with LNG bunkering facilities and LNG bunkering vessels. He said there was just one LNG bunkering vessel in operation at the beginning of 2017, but there are six or seven today and 14 more on order.  

 LNG is a way for a company to “future proof” itself from increasingly stringent regulations. He said LNG prices have been less volatile than oil prices.  

Despite the growing number of orders for ships that can operate using LNG as fuel or use scrubbers, most shipowners are expected to comply with the IMO requirement by burning low-sulfur liquid bunker fuel.
    For example, Soren Skou, the chief executive officer of the largest container carrier, Maersk, said earlier this month, “I don’t think it’s feasible to retrofit ships with LNG propulsion.
   . “For us to build washing plants (scrubbers) on 700 ships simply does not make any sense to me,” he explained.
     While seemingly unenthusiastic about scrubbers, Skou said Maersk “may invest in a few scrubbers simply to understand the technology. We don’t like the solution.”
    On the other hand, media reports indicate the second-largest container carrier, Mediterranean Shipping Company, may be receptive to using scrubbers.
    In July, the website Shipping Watch said it was told MSC has placed an $170 million order with Wartsila to retrofit some ships with scrubber systems.
   TradeWinds also reported MSC was planning to equip ultra-large containerships with scrubbers.
   Evergreen Marine is installing scrubbers on 20 containerships with capacity of 11,000 TEUs each.  

The third-largest container carrier, CMA CGM, last year ordered nine 22,000-TEU ships that will be powered with LNG. The ships are to be delivered in 2020 and 2021. Last December CMA CGM signed an agreement with Total to supply 300,000 tons of LNG annually for the ships for a decade beginning in 2020. 

 Rolf Habben Jansen said that Hapag-Lloyd has decided to do a pilot project with scrubbers beginning next year and is looking at the possibility of converting at least one of the LNG-ready ships it added to its fleet through its acquisition of United Arab Shipping Company.
    “Depending on the outcome of that, we may look at converting the other 16,” he said. 



Disclaimer
Copyright © 2018 PORT TO PORT - Shipping Services Portal ( Sagar Sandesh ). All rights reserved.

Follow Us