Choices Will Have to be Made on Where HSFO Supply Continues After 2020: Total

Monday January 8, 2018

With the vast majority of vessels expected to switch to using a compliant distillate fuel when the new 0.50% global sulfur cap comes into force in 2020, Olivier Jouny, Managing Director of Total Marine Fuels Global Solutions (TMFGS), says the supply of high sulfur fuel oil (HSFO) will not necessarily continue in all ports.

"In the key hubs the demand will be there and we will continue to offer both 0.5% and the higher sulfur products after 2020. But in the smaller ports, choices will have to be made," he told Ship & Bunker.

"Right now we cannot answer precisely as to how sustainable it will be to offer both products in all ports, but as HSFO demand falls it will certainly impact on unit cost and impact on the delivered bunker price. Right now it would seem likely there will be some rationalization of supply, especially outside of the big hubs."

In order to continue burning HSFO bunkers after 2020, vessels must be fitted with an exhaust gas cleaning system, more commonly known as a scrubber, in order to achieve an equivalent method of compliance as vessels burning compliant fuel.

Jouny says predicting how many vessels will ultimately choose to adopt scrubbers is becoming increasingly unclear as the scrubber proposition itself is changing.

"I think one to two years ago the economics of a scrubber solution were for many people a no-brainer, but this has started to change because of the uncertainty of extra regulation in the future. There is a big debate on open loop vs closed loop scrubbing. Open loop solutions are economically very attractive but there is the question of the long run tolerance of such systems. On the other hand, the economics of closed loop scrubbers are quite different, as are their operational needs with the alkali supply and scrubber's sludge management," he said.

"The most important thing is to understandis that there is no one solution that is right for everyone, and different people will also make different assumptions about what future regulations will be. This is why Total is positioned as multi-fuel provider that can answer questions on the risks and advantages of all solutions."