IMO2020: Ardmore Says Scrubbers "Not Particularly Compelling"

Thursday November 8, 2018

With the market seemingly at the point where shipowners are unable to complete an earnings call without discussing their position on scrubbers, Ardmore Shipping Corp [NYSE:ASC] Wednesday was the latest tanker owner to reveal its position on the technology as an IMO 2020 compliance solution.

"We've chosen for the time being not to go down the scrubber route," CEO Anthony Gurnee said during the product and chemical tanker owner/operator's Q3 2018 results earnings call.

"Our own view is that the return on investment and the risks around it for an MR are not particularly compelling the way we see it."

Gurnee says installing units his firm's 28-strong fleet would be "60 million or 70 million."

"Quite frankly, we would be buying ships rather than installing scrubbers, if we had that kind of capital ready to invest."

But unlike some in the industry, Gurnee also believes there is no right or wrong when it comes to using the increasingly polarizing technology.

"I think it's important to highlight the fact that every company has its own set of particular circumstances and framing and decision-making process," he said.

Like other tanker owners, Gurnee is upbeat for what IMO 2020 means for the sector.

"IMO 2020 is expected to create upside for the entire tanker market. and product tankers in particular from mid 2019," he said.

"IMO 2020 is expected to be a game changer, with increased seaborne volumes of compliant fuels, increased arbitrage opportunities, and oil trading activity, all contributing to a significant boost in tonne-mile demand."

* Earnings call transcript in part by Seeking Alpha