Register for a free trial
Social
Marine Propulsion & Auxiliary Machinery

Marine Propulsion & Auxiliary Machinery

Maersk 2020 changes: scrubbbers, bunkering and surcharges

Fri 14 Sep 2018 by Jamey Bergman

Maersk 2020 changes: scrubbbers, bunkering and surcharges
Maersk 2020 preparations: scrubbers, surcharge and bunkering initiative

Maersk is adding exhaust gas cleaning systems, or scrubbers, to some of its ships to comply with IMO sulphur limits coming into effect in 2020, and the company is also introducing a surcharge on its customers to compensate for compliance-related costs it expects to exceed US$2Bn. 

The scrubber order comes just under a year after the container shipping giant repeatedly said it was "ruling out scrubbers" as a 2020 compliance option and sees Maersk joining a growing number of companies who have purchased scrubbers in a trend that has accelerated during the course of 2018. 

Maersk's head of oil trading Niels Henrik Lindegaard said although the company is diversifying its compliance options, it is still betting heavily on low-sulphur fuel.

“Maersk is looking into all possible and available opportunities to ensure we are ready to comply with the 2020 sulphur cap," Mr Lindegaard said. "As part of the preparations, we have decided to invest in new scrubber technology on a limited number of vessels in our fleet of around 750 container vessels."

"While we will continue to explore how to best comply with the 2020 sulphur cap, we still believe the best solution remains with compliant fuels from refineries on land. It is important to underline that the vast majority of ships in the global fleet, as well as the Maersk Line fleet, will have to comply with the global sulphur cap through the use of compliant low-sulphur fuels in 2020 given the short time frame," he said.

Mr Lindegaard said the decision to install scrubbers represents only a small piece of Maersk's 2020 fuel sourcing strategy. He noted the company's joint initiative with Vopak Terminal in Rotterdam on a 0.5% low-sulphur fuel bunkering facility and said the facility will cater for approximately 20% of Maersk's global 2020 compliant fuel demand. Mr Lindegaard also said Maersk was seeking to secure similar bunkering facilities elsewhere.

In order to offset its predicted US$2Bn in 2020 compliance-related fuel costs, Maersk is adding a Bunker Adjustment Factor (BAF) surcharge onto its clients bills from 1 January 2019. 

The charge is derived by calculating the average fuel price in "key bunkering ports around the world" along with a fuel consumption average that is specific to trade lanes and includes factors such as transit time, fuel efficiency and "trade imbalances between head haul and backhaul legs".

A statement from Maersk said the BAF surcharge is replacing its current Standard Bunker Adjustment Factor (SBF) surcharge and is designed to "enable customers to predict, plan and track how changes in fuel price impact the shipping freight rate".

"Based on expected differences in price between current 3.5% sulphur bunker fuel and compliant 0.5% sulphur fuel, external sources estimate the additional cost for the global container shipping industry to comply could be up to US$15Bn. Maersk Line expects its extra fuel costs could exceed US$2Bn," the statement said.


The operational realities of the 2020 sulphur cap will be discussed in detail at Riviera Maritime Media’s Asian Sulphur Cap 2020 Conference which takes place 24-25 October 2018 in Singapore.

Related articles

 

 

 

 

Knowledge bank

View all