Maersk Line Presses Hong Kong to Take Action on Low Sulfur Bunkers

Tuesday January 8, 2013

Maersk Line has said that, unless Hong Kong makes using low sulfur bunkers mandatory for vessels calling at its port, the company will stop its voluntary use of the more expensive fuel there, Bloomberg reports.

In September 2012 Hong Kong started a 3 year incentive scheme on port fees for ocean going vessels that use fuel with a maximum sulfur content of 0.5 percent while at berth, but Tim Smith, Maersk Line's North Asia CEO, said the payments don't cover its additional costs and are often delayed.

Smith said the port discount only adds up to 40 percent of its cost to switch fuel, and put the firm's cost of using lower sulfur bunkers at up to $2 million a year.

He said the company, and 17 other operators that voluntarily use low-sulfur product at the port, are therefore at a disadvantage to those that continue using regular bunkers with a maximum 3.5% sulfur content.

"Some carriers turn up here, they don't switch to low- sulfur fuel, and they get a cost advantage," he said.

"We don't think that's right. What we want is the government to regulate."

A joint study last year by Hong Kong-based think tank Civic Exchange and Hong Kong University said the introduction of a regional Emissions Control Area (ECA) for Hong Kong and the Pearl River Delta (PRD) area would reduce the annual 519 premature deaths caused by marine sources of sulfur dioxide (SO2) by 91%.

Veronica Booth, a senior project manager at Civic Exchange, commented: "Certain shipping lines are reluctant to spend money on these sorts of initiatives, particularly when there's no end in sight to a voluntary scheme."

A government report released in October found that sulfur dioxide (SO2) emissions by marine vessels in Hong Kong rose 9.7 percent between 2009 and 2010.