MUMBAI: Essar Shipping is planning to install scrubbers on four out of
its 12 owned vessels as part of its preparations for the 2020 sulphur
cap.
The ships in question include three minicapes and one VLCC, the company
said, while the rest of the fleet will switch over to low-sulphur fuel.
Essar Shipping estimates the installation of scrubbers to be completed by April/May 2020.
“With the installation of scrubbers, the capital expenditure recovery
(payback period) may be 18 to 24 months depending on differential of
prices between higher sulfur heavy fuel oils (HSHFO) and LSHFO,” the
company explained.
“However, there are some challenges that need to be taken into account.
While forecasting in this business, there are numerous variables that
come into play, such as, demand and supply of tonnage, number of ships
that are currently trading, the number of ships that will be scrapped,
the number of ships that would be installed with scrubbers, the number
of ships that are being ordered, the commodity cycle of a particular
vessel, etc.”
According to the latest estimates from the Exhaust Gas Cleaning System
Association (EGCSA), there will be at least 4,000 ships fitted with
scrubbers in 2020.
The scrubber installations have gravitated towards the larger vessels
and vessels with high installed power where the economics of the
investment versus the lower fuel cost are projected to give a high rate
of return.
The majority of the installations are open-loop scrubbers that use
seawater as the process fluid and discharge the treated and continuously
monitored water overboard.
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