No delays to implementing shipping fuel sulfur cap in 2020: IMO

SINGAPORE/LONDON (Reuters) - The International Maritime Organization (IMO) will not delay implementing a reduction in the amount of sulfur in marine fuel in 2020, officials with the UN’s shipping agency said on Tuesday.

FILE PHOTO: Chemical/Oil Products Tanker Adelaide travels near the shores of Singapore June 10, 2018. REUTERS/Tim Chong/File Photo

“I can categorically say there will not be a delay,” said Edmund Hughes, the head of air pollution and energy efficiency at the IMO, during the Asia Pacific Petroleum Conference (APPEC) in Singapore.

From 2020, IMO rules will ban ships from using fuels with a sulfur content above 0.5 percent, compared with 3.5 percent now, unless they are equipped with so-called scrubbers to clean up sulfur emissions. This will be enforced by fines levied by the IMO’s member states.

The IMO regulations will create a level playing field for the global shipping industry and if it were to back down, it could lead different rules being implemented in different regions, creating greater levels of uncertainty for the global industry, Hughes said.

“A delay to the regulation would damage the IMO’s reputation and credibility as a rule-making body for international shipping and would lead to more regional and national action to control air pollution from ships,” he said.

Frederick Kenney, director of legal affairs and external relations with the IMO, said separately that even if a motion was proposed by member states to change the implementation date it would take 22 months for any amendments to take effect, which would run beyond 2020.

“You have to look at how strong the majority was to implement … 2020 and it would be up to the proponents of any change to change that consensus,” Kenney told Reuters at a Capital Link shipping conference in London.

A paper submitted to the IMO by the Bahamas, Liberia, Marshall Islands and Panama together with BIMCO, INTERTANKO and INTERCARGO shipping associations called for ways to gather and analyze data to see if changes needed to be made to the 2020 regulations.

The paper said challenges in implementation of the regulations “must be resolved satisfactorily in the months to come in order to preserve the smooth flow of maritime trade”.

The shipping and oil refining industries are scrambling to prepare for the shift and have made large investments to comply with the new standards since they were announced in 2016.

But some shippers have been slow to respond and have argued that the burden of compliance with the IMO’s stricter fuel standards should rest with refiners to produce lower sulfur fuels.

“(This) is a shipping regulation and it’s amazing how many times I’ve heard this is a refining problem,” said Savvas Manousos, global head of trading at Maersk Oil Trading, at the conference.

“The onus of compliance is on the shipping industry, not on the refining industry,” said Manousos, adding that the two industries must work together to address the global issue.

Maersk Oil Trading purchases marine fuel for its parent company A.P. Moller-Maersk and is among the biggest ship fuel buyers in the world.

Editing by Christian Schmollinger and Jane Merriman