100% Sulfur Compliance by 2020 Is only a dream for bunker industry

The world’s bunker industry is unlikely to reach the International Maritime Organization (IMO) global sulfur cap target by 2020, according to a Platts report, which termed the target “a tough climb”.

The lack of availability of 0.5% sulfur compliant fuels or other suitable alternatives is just one challenge. Oil price uncertainty and the costs involved will also pose problems, said Platts, citing unnamed sources, who claimed that both the refining industry and the shipping sector were ill-equipped to deal with “the tectonic shifts”. More than 30% of respondents at industry conference Fujcon 2017 in Fujairah last week said there would be some non-compliance with the related emission control area (ECA) cap by 2020, the report noted.

Red Sea Marine Management DMCC CEO Gamal Fekry said at the conference that “everybody is waiting because there is no incentive in place to do anything right now. Banks are not going to give money for scrubbers unless they know the repayment or payback time and find the economics attractive, while LNG is for the future as infrastructure is insufficient and capital intensive”.

Paul Nix, general manager of terminal operations at Gulf Petrochem, noted that, when ECA zones were first introduced in Europe, some shipowners opted to pay the fines rather than comply with the sulfur limit, as this was cheaper than burning ECA-compliant fuels.