Scrubbers vs VLSFO, Feb 2020

At times of uncertainty, SOx Scrubbers are the most reasonable solution.

Feb. 26, 2020

Almost 2 months have passed since the implementation of IMO 2020 new fuel rules and the market is still surrounded by significant uncertainty. Choosing between installation of SOx scrubbers and changeover to compliant fuel has turned out to be a challenging puzzle, even for the most skilled of solvers.
With the HFO-VLSFO spread currently under $200, some owners have shifted towards the low-sulphur bunkers option. Yet, the majority of the industry is currently standby, waiting for the market to stabilize and recover from ongoing unforeseen circumstances. Bunker demand, and consequently VLSFO prices, are decreased due to the COVID-19 outbreak and the prolonged warm winter. Of course this situation is no normality and will probably not last after April/May period.
Moreover, serious concerns have risen regarding the quality of the new VLSFO that is reported to contain high-levels of aromatic compounds which result in an increase of black carbon emissions that pose a serious environmental threat, according to a study conducted by Finland and Germany and submitted to the IMO. Especially regarding the Arctic region, increased emitted black carbon volumes can create major negative environmental outcomes.
On the other hand, although some concerns have surfaced regarding the discharge of wastewater from open-loop systems, scrubbers remain a reliable IMO 2020 compliance option and at the same time a risk-mitigation factor, on both OPEX and environmental ends. We can take for granted that HFO prices will always be lower than VLSFO. Furthermore, according to Gibson shipbrokers, scrubber retrofitted vessels provide an approximate 30% reduction in black carbon emissions.
It is no coincidence that Maersk, whose stance was previously against Exhaust Gas Cleaning Systems, has strategically decided – and announced – to install SOx scrubbers on a large number of vessels and considerably increase the usage of HFO from 10% of total fleet consumption to 25% by the end of 2020.

It is said that uncertain times require certainty in decision making; if requested, Maritech Group is here to assist you.
Our principals, Pacific Green Marine Technologies (PGMT), offer the most cost-efficient SOx scrubber solution in the shipping industry, ENVI-Marine™, a system that effectively combines: maximum particulate absorption – thus comfortably meeting the required emission limits -, very low space and consumption requirements, a rectangular body with no moving parts that enables the advantageous non-enclosed installation option, and a very low cost. Most importantly, through joint venture with PowerChina, unrivalled access to shipyards and unlimited manufacturing capacity are achieved.

Maritech Group Sales Department

Maritech Group is the exclusive commercial agent of PGMT in Greece.