Transcript Low Sulphur Fuel Regulations

Low Sulphur Regulation
September 2014
CSG / CBG
“K” Line
Index
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What is “Low Sulphur Fuel”?
Environment – New Sulphur regulations
“ECA” & regulations related to ECA
Impact to our industry
What is “Low Sulphur Fuel”??
Low Sulphur Fuel is…..........
“Gas oil” which eliminate Sulphur content
drastically in petroleum refining process and
reduce the effects on the environment.
Public opinion for“Low Suphur Fuel usage” is heating up
through the entire world during recent years.
since Sulphur originate toxic gas, and have negative effects.
New regulation are coming up…
New Sulphur Regulation-1
The higher sulphur content, the worse the impact on
environment when consume Marine fuel.
Require the rules which aimed to preserve the
environment to be complied with ships in the world.
New Sulphur Regulation-2
International regulations for marine transportation
were established by International Maritime
Organization (IMO).
IMO established new sulphur regulation to release less
Sulphur Oxide(Sox) in ECA in accordance with MARPOL IV.
MARPOL IV & ECA
“MARPOL IV”
International regulation for the prevention of
pollution from ships to minimize pollution of
the sea, including dumping, oil and exhaust
pollution.
ECA(Emission Control Area)
Area which severely controled SOx(Sulphur Oxide)
emission from ship designated ｂy MARPOL IV.
Special sea area “ECA” is………
Emission Control Area (ECA)
In Europe,Baltic Sea and North
Sea area
Source：NK HP,
Wikipedia
In North America,
1. 200 nautical miles from coasts of the US
and Canada area.
2. US Caribbean Sea area (Region of
Puerto Rico and US Virgin Islands )
Establishment of new sulphur regulation
MARPOL Annex Ⅵ (Sulfur Oxides (SOx) Regulation)
Sulfur Limit
In the following sea areas, vessels are required to use the fuel which are specified
the maximum sulfur content.
1st July.
2010
Outside an ECA
established to limit SOx
and PM emissions
( ECA : Emission Control
Areas )
Inside an ECA established
to limit SOx and PM
( Baltic Sea and North Sea
area )
4.5%
aa
1st Jan.
2012
1st Aug.
2012
3.5%
1st Jan.
2014
1st Jan.
2015
0.5%
3.5%
0.1%
1.0%
1.5%
1st Jan. 2020 or 2025
* Depending on the
outcome of a review,
to be concluded in
2018.
Present
Limit
Inside an ECA established
to limit SOx, NOx and PM
( 200 nautical miles from
coasts of the North
American and Canada
area )
4.5%
Inside an ECA established
to limit SOx, NOx and PM
( United States Caribbean
Sea area )
4.5%
3.5%
0.1%
1.0%
3.5%
1.0%
0.1%
Establishment of new sulphur regulation
MARPOL Annex Ⅵ (Sulfur Oxides (SOx) Regulation)
Sulfur Limit
In the following sea areas, vessels are required to use the fuel which are specified
the maximum sulfur content.
1st July.
2010
1st Jan.
2012
1st Aug.
2012
st
Outside an ECA
established to limit SOx
and PM emissions
( ECA : Emission Control
Areas )
- From 1 Jan. 2015 new regulation
4.5%
aa
3.5%
come into force in the Emission Control
Areas (ECA).
Inside an ECA established
to limit SOx and
PM
Ships
must use
1.0%
1.5% fuel with maximum
( Baltic Sea and North Sea
area )
allowed Sulphur content of 0.1% in the
Inside an ECA established
ECA.
to limit SOx, NOx and PM
( 200 nautical miles from
coasts of the North
American and Canada
area )
Inside an ECA established
to limit SOx, NOx and PM
( United States Caribbean
Sea area )
4.5%
4.5%
3.5%
1st Jan.
2014
1st Jan.
2015
0.5%
3.5%
0.1%
Present
Limit
0.1%
1.0%
3.5%
1st Jan. 2020 or 2025
* Depending on the
outcome of a review,
to be concluded in
2018.
1.0%
0.1%
Fuel segment
LSDO/GO  Sulphur content of under 0.1%
LSFO
 Sulphur content of 0.1% under 1%
HSFO
→ Sulphur content of 1% under 3.5%
LSDO/GO have to be used from
1st/Jan 2015 in ECA
DO(Diesel oil) is composed of the same material as Gas(Oil).
Appellation
General
ISO
JIS
GO
DMX or DMA
軽油
DO
DMB
A重油
Inspection for LSDO/GO Proper Usage
EPA(Environmental Protection Bureau) check
Fuel sampling or fuel order statement or
log data in this vessel 
So no way to escape from the rule !
If off-spec fuel is used......
 We will be penalized and/or port calling will
be rejected
Fuel Cost Increase !!
LSDO/GO (sulphur contents under 0/1%) is
much more expensive than other fuel
“K” Line face huge increase of operating cost!
More additional cost…
When vessels are built in the past, they were not
designed to accommodate such LSDO/GO
To meet new regulation, “K”Line (and all
shipping lines) have to modify fuel tank of our
vessels
Conclusion –
“Necessity of new surcharge”
• In order to meet the requirement to protect
our environment, we have to seek customer’s
understanding on how shipping lines have to
face huge additional cost
• New surcharge to cope with such challenging
additional cost is inevitable
• “K”Line will release announcement soon.