The prescribed reduction in the sulphur content of fuel oil used by ships is only two years away. About 70,000 existing vessels need to be ready to meet the requirements of IMO’s global sulphur limit of 0.50% m/m in 2020. Yet many ship owners are still undecided and have not made up their minds about how to comply with the new regulations. A recent study by ExxonMobil showed that 32% of the respondents predict that a combination of heavy fuel oil, marine gas oil and fuels and blends will be used, whereas 69% believe the cap will lead to the development of new low sulphur fuels. Basically there are four different options for ship owners for compliance:
- Compliant fuel oil
- Gas oil
- Alternative fuel
- Emission abatement technologies
In this article we focus on some of the advantages of the compliance options and issues which may arise by opting for one solution or another.
Lately there has been much said about exhaust gas cleaning systems such as scrubbers. Big market players like Maersk have questioned the use of scrubbers for meeting the global sulphur cap. But why? To begin with, a scrubber is a piece of equipment that sprays alkaline water into a vessel’s exhaust to remove sulphur and other unwanted chemicals from the fuel. So, a scrubber’s principal advantage is to enable ship owners to continue burning fuel oil while complying with the new regulations. But there are high costs for retrofits with up to $6 million needed to install the equipment on each vessel and on top of the capital expense is the cost of taking the vessel to dry dock for about a month, not mentioning the added costs dealing with sludge retention and disposal. After installing, scrubbers require high maintenance and specialised personnel. Though the scrubber technology can be cost effective over time, it may not be a long-term solution as the recent equipment is not designed to cope with all of the environmental regulations likely to be imposed on shipping over the next decade.
Other industry players, as well as many politicians in Europe and North America, see liquefied natural gas bunkering as a solution to the shipping industry’s environmental problems. LNG enables 100% reduction of SOx emissions and 90% reduction of NOX emissions compared to heavy fuel oil. Furthermore, the CO2 emissions are 25% lower than those ones from heavy fuel oil and marine gas oil and looking into future LNG also protects against environmental restrictions for shipping on nitrogen, particulate matter or carbon emissions.
But there is a downside to all of this as LNG leaks methane, which has a negative impact on global warming. In fact, the natural gas that can escape while bunkering can raise even higher greenhouse gas emissions than a gasoil-based bunker fuel. Looking from a financial point of view, ship owners and ports are facing high costs for retrofitting current ships and providing the necessary infrastructure in ports if they opt for LNG. At present LNG bunkering is mostly being done by passenger vessels steaming short distances around Scandinavia. Though there are tangible infrastructure developments on the way, the availability and infrastructure remains less than transparent to ship owners and operators. Especially for ships with no fixed trading patterns this becomes an issue as details of how, when and even sometimes exactly where bunkering operations will be carried out are not fully settled.
For many others, marine gas oil may be the way to go. Japanese shipbuilder Onomichi President Takashi Nakabe recently said: “I personally think marine gas oil is the solution for the shipping industry”. As MGO is a proven distillate-based light fuel oil, it already meets the IMO global sulphur cap regulation and the higher standards in near-sea emission control areas. In addition, MGO can be used in most HFO systems and only minor adjustment in auxiliary equipment is needed in some cases, which makes MGO to a straight forward solution for meeting the sulphur limit. In comparison to LNG the cargo capacity of MGO is not restricted, meanwhile, as well as LNG, the price is double compared to HFO. Switching to MGO may also require upgrading to the fuel treatment plant due to the significantly lower viscosity of the fuel. Whereas the capital investment for MGO is low, the operating costs might be very high. During the implementation of the SECA areas the majority of operators simply switched to MGO fuels. If the shipping industry follows the same pattern again, increased MGO prices are inevitable in the short term as refineries would seem to prefer to produce MGO to heavy fuel oil as it is more profitable.
So far, the simplest option for ship owners seems to be opting for 0.5 sulphur fuel. But, as with all the other solutions, there are issues as well. First of all there is no accepted standard for refining 0.5% sulphur fuel. Essentially the sulphur can be reduced from the fuel oil in two different ways: hydrocracking and blending. Hydrocracking requires enormous investments and lead times on the part of refiners, which will very quickly impact the price. As for blending, the process raises the risk of fuel incompatibility as the fuels commingle and settle in the fuel tanks, creating sludge and other problems that can lead to unexpected stoppages or even engine failure. As long as there is no standard specification for low sulphur fuels engine manufacturers can’t give appropriate operational and maintenance advice, which results in uncertainty. However, fuel treatments, like Aderco, can meet these concerns. They reduce the likelihood of unexpected stoppages and sludge rejects as they are designed to solve fuel-related problems while protecting the fuel pump, injection system and the whole operation before, during and after combustion.
Just by looking at these options it seems that there is not just one solution for the shipping industry to comply with the sulphur cap in 2020. The marine sector is heading into a mixed fuel future. Overall, it’s not only about making the right decision for meeting the directive, but also saving your fuel investment from instability and incompatibility issues.
What is your opinion? Let us know in the comments down below!
The new sulphur limit coming into force in 2020 will have a significant impact on the quality of the fuels, according to FOBAS Product Manager Muhammed Usman. He says “one big concern is the stability and the compatibility of these fuels with other blends”. In his interview with Bunkerspot he also discusses the level of diversification, the ISO 8217:2017 specification and very low sulphur fuel oils.
Read more here: Bunkerspot
Certain shipping companies, especially the larger ones, are better at understanding their exposure, most however just seek the best price of the day. To overcome this shortfall, almost all rely on traders who, through their global networks, provide access to information on pricing, quality and availability. Less than a handful offer strategic insight, quality control and risk management. The unregulated infrastructure of the marine fuels market has made the need for traders essential. Unfortunately, there are too many traders and only a few deliver true value in what is an ongoing stagnant market where sustained low prices have kept marginal traders in the mix.
As exceptional the findings may be, they underscore the potential of even more uncertainty, and thus risk, that needs to be addressed: the FOBAS analysis states that “Al+Si at 75mg/kg can be difficult to reduce but may be manageable; however Al+Si at levels up to 139mg/kg would prove extremely difficult to bring down to acceptable levels for engine entry (<15mg/kg). Carry over of abrasive Al+Si material at high levels may lead to damage to fuel pumps/injectors and cylinder components.”
What is a Chief Engineer to do when the bunker analysis comes in three days out at sea with numbers that far outside the confidence range? Just to be on the ‘safer’ side, Shipowners and Managers will find themselves saddled with additional procedures, maintenance and costs due to increased constraints on fuel handling and management (extended fuel settling and purifying times, more frequent draining, elevated heating, greater care with backwash fuel oil) and a heavier workload on fuel separators.
Catfines play a role in the crude oil refining industry in the catalytic cracking process that involves splitting large, high-boiling hydrocarbon molecules into smaller ones to increase refining yield. They can occur at high concentrations in slurry oils, the product drawn at the bottom of the catalytic cracking fractionator. It’s because these slurry oils are highly aromatic and have a low viscosity, that they are an ideal blending component in HFO production. That is how catfines enter HFO, and concentrations vary depending on the quantity of slurry oils used in the blending and the quantity of catfines already present in these same slurry oils. This also explains the wide fluctuations between catfine levels in HFO.
By nature, catfines are hydrophilic, i.e. they are attracted to water molecules and tend to stick to them. This combination catfines/water will be difficult to extract from the fuel at the separator levels, however. With smaller particles, the catfine/water combination will emulsify and hamper purification performance. Compounding the problem is the fact that catfines come in varying sizes, fewer particles that are larger in size will be more readily ejected. High concentrations of minute catfine particles pose a much greater – and no less real – threat.
According to FOBAS data, purifiers nowadays operate at 60 to 65% on average.
At the same time, the hydrophilic nature of catfines offers a solution for reducing risk: Using a surfactant-based fuel treatment solution that facilitates water separation will ensure that a significant portion of the catfines captured by water molecules in the fuel tanks can be drained off along with the water.
Allowing thorough settling of the fuel will further reduce the counts of catfines, especially large particles. In addition, the right fuel treatment solution will also isolate contaminants, disperse agglomerations that lead to sludge, and stabilise as well as homogenise the fuel. The net effect: The fuel enters the line cleaner for more efficient combustion, plus it has a lower catfine count, enabling the separator to eject remaining catfines and contaminants more effectively, and ensuring the engine is fed a healthy diet.
Reports and findings that meet strict standards, like this recent FOBAS spot check, provide an invaluable heads up. They also underscore the importance of allowing for sufficient safety margins – and the advantages of preventing risk over repairing damage.
The FOBAS report is just one of many concerned with the quality and regulation of fuels in industrial and marine uses. Take the 2020 sulphur cap, another hot button issue. Ensuring supply security and consistent quality will be a tough challenge, especially with demand projected at up to 2,000,000,000 barrels a day. Removing sulphur from fuel oil means either hydrocracking or blending or a combination of both. Downstream, this could very well mean higher prices for uncertain quality along with the risk of fuel incompatibility and other problems that can lead to unexpected stoppages.
More prevention will be key in addressing the uncertainty and the challenges ahead, from catfines to sulphur emissions as well as other non fuel-related issues. Along with a holistic approach to applying the right tools from a shared toolbox.
Read more here https://shipandbunker.com/news/emea/125965-fobas-alert-high-catfines-fuels-in-fujairah