Are tankers green maritime outlook middle east abu dhabi 7 april 2009
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Are Tankers Green Maritime Outlook Middle East Abu Dhabi 7 April 2009. [email protected] Manager Research and Projects. Tanker shipping serving some of the world’s biggest companies.

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Are tankers green maritime outlook middle east abu dhabi 7 april 2009

AreTankersGreenMaritime Outlook Middle EastAbu Dhabi 7 April 2009

[email protected]

Manager Research and Projects


Tanker shipping serving some of the world s biggest companies

Tanker shipping serving some of the world’s biggest companies

BP’s approach to managing the environmental impact of its operations is underpinned by the goal of continuous performance improvement

We strive to conduct business in a manner that is protective of the environment, and that is compatible with the environmental and economic needs of the communities in which we operate.

Meeting the world’s growing energy needs and protecting the environment requires new technology, new partnerships and new ways of operating.

How to produce energy in environmentally responsible ways


Are tankers green challenges

Are tankers Green? Challenges

VOC = Volatile

Organic

Compounds

ODS = Ozone

Depleting Substances

(cooling medium)

CO2/GHG emission

NOx, SOx, PMAnnex VI

Life cycle

Building to

Decommissioning/

recycling

Sewage

Garbage

Toxic

Antifouling

Accidentaloil pollution

Ballast water


Environmental challenges in shipping cleaner seas cleaner air a sound mother earth

Environmental challenges in shippingCleaner seas, cleaner air, a sound mother earth

  • Cleaner air

    • Annex VI implemented

  • GHG reduction

    • Currently the biggest challenge

  • Cleaner seas

    • Oil pollution

    • Acidification of oceans

    • Anti-fouling Systems

    • Garbage, other pollutions into the sea

  • Invasive spices – ballast water management


Are tankers green maritime outlook middle east abu dhabi 7 april 2009

  • Emission to air?


The challenges

The Challenges

  • The world demands greener shipping

  • Emission from shipping is dirty and harmful for the health and the environment

  • GHGs emission from shipping is not directly regulated under the Kyoto protocol

  • IMO assumed to regulate GHG emission

  • Shipping must react


Co 2 emissions per unit load by transport mode

CO2 Emissions per Unit Loadby Transport Mode

Large Tanker

1

Large Containership

3

Railway

6

Coastal Carrier

11

Standard-size

Commercial Truck

49

Small-size

Commercial Truck

226

Airplane

398

0

100

200

300

400

Units Relative

Shipping energy efficient

Source:Ministry of Land, Infrastructure and Transport (Japan): The Survey on Transport Energy 2001/2002 MOL (Japan): Environmental and Social Report 2004

7


Engine break specific fuel consumption

Engine break specific fuel consumption

g per kWh

Source: Lloyd’s Register

Fuel efficiency in shipping has has improved


Trends co2 emission energy use global trade

Trends – Co2 emission, energy use, global trade

Index

There has been strong growth in shipping

Source: Fearnleys/INTERTANKO


World primary oil demand iea the reference scenario

World primary oil demand IEA the Reference Scenario

mbd

Source: IEA


World primary energy demand iea the reference scenario

World primary energy demand IEA the Reference Scenario

1000 million tonnes oil equivalents

Source: IEA


Are tankers green maritime outlook middle east abu dhabi 7 april 2009

  • MARPOL Annex VI


Reducing harmful emission to air from shipping

Reducing harmful emission to air from shipping

  • Emission regulated by MARPOL Annex VI:

    • SOx

    • NOx

    • un-combusted hydrocarbon

    • Heavy metals

    • Soot

    • Volatile Organic Compounds - VOC


The annex vi package

The Annex VI package

  • All ships above 400GT

  • Reduction SOx, NOx, + PM

  • Compliance through fuel specification or

  • Equivalent measures accepted

  • Assumes supply of low sulphur fuel*

  • Bunker Delivery Note BDN important **

* Ships not punished if required fuel not available

**Guidelines to asses compliance if BDN data is challenged by PSC or lab test results


The world is moving away from hfo oil consumption by product share

The world is moving away from HFOOil consumption by product - % share

mbd

% share

Source: INTERTANKO/BP Review


Why not scrubbers

Why not scrubbers?

  • Still under testing (3 ship limited scale)

  • Large

  • Expensive

  • Difficult (impossible?) to install

  • CO2 emission (buffering effect)

  • leaves hazardous waste onboard which no-one wants

  • Tonnes of seawater need to be pumped through the ship and processed

We are involved in transportation – not waste treatment


New measures adopted at mepc 58 sox emissions

New measures adopted at MEPC 58: SOx emissions

Emission Control Area (ECA)1.0% limit

Global 3.5% limit

  • ECA 0.1% limit:

IMO review

Global 0.5% limit

Extension?

2010

2012

2015

2020

2025

2018

No measures against ships that do not receive adequate supply


New measures adopted at mepc 58 nox emissions

New measures adopted at MEPC 58: NOx emissions

Current regulation Tier I: existing ships built after 2000, base line

Tier II:15.5% - 21.8%reductionships built on, after 1 Jan 2011

Tier II: 80%reduction ships built on, after 1 Jan 2016Power output > 750 kW

In Emission Control Areas (ECAs) ONLY

Tier I: ships built 1990s engine>5000 kWh, cylinders = >90 ltrs

2010

2011

2016

Many preconditions: engine rating, fuel consumption, durability, cost/benefit, availability of efficient upgrading system , upgrading at the ship’s first renewal survey


Switching to distillates will

Switching to distillates will

  • Reduce global emissions

    • SO2 - 60-80%,

    • PM - 80-90%

    • NOx -15%

    • No heavy metals, less soot

  • Improve conditions for crew and dockworkers

  • Cause no safety problem in connectionwith fuel switching fuels entering ECAs

  • Causes less engine breakdowns and potential pollution accidents

  • Cause far less pollution when spilledProvides opportunity for the development of more efficient engines (w. less emission)

  • Fit all ships and current engines

  • Be easy for authorities to control

  • Challenge to produce sufficient clean fuel

  • Cleaner, Simpler and more Efficient ships


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    • GHG emission


    Shipping s tools to reduce ghgs

    Shipping’s tools to reduce GHGs?

    • Indices

      • Design

      • Operational

  • Market instruments

    • Emission trading Scheme (ETS), to stimulate entrepreneurship?

    • Levy, equal to tax?

    • Offset charges (ref IOPC)?

  • Ship Efficiency Management Plan

  • No general agreement on how to regulate GHG emission from shipping


    Co 2 reduction

    CO2 reduction

    40 - 80 % increase if

    no efficiency

    measures taken

    World Fleet Energy Consumption

    Bridgeable gap??

    20 - 30 % absolute reduction onshore

    On-shore target

    Reference


    The stern report

    The Stern Report

    • Conclusions

    • Climate change may initially have small positive effect, but longer term the effects will be very damaging Benefits of strong, early action outweigh the costs.

    • Policy of action to be based on 3 elements:

    • Carbon pricing

    • Technology

    • Behavioural change

    Later the situation is said to be much more serious that outlined in The Stern Report

    Lord Stern of Brentford


    Energy efficiency design index eedi

    Energy efficiency design index (EEDI)

    • Will mandate a minimum acceptable fuel efficiency for new ships

    • Deliver real, sustainable CO2 reductions based on an agreed emissions reduction trajectory.

    • Wide support in IMO, except

    • Some developing countries*

    • Initial EEDI will form the baseline for the most efficient ships today

    Sea trial Esther Spirit

    To be based on, installed power, specific fuel consumption, correction factors to account for specific design elements, speed, dwt, the contribution from auxiliary machinery

    *Wants “common but differentiated responsibilities” agreed under UNFCCC and the Kyoto Protocol.


    The co 2 operational index

    The CO2 operational index

    • An instrument for evaluating quantitatively the effect of operational fuel efficiency measures, such as speed reduction or optimum navigation

    • Charterers greatest influence

    • Not immediately mandatory

    • No direct link to design index


    A market based instruments mbi should

    A Market Based Instruments (MBI) should

    • Reduce CO2 emission levels in real terms byadditional amounts to normal reductions by stimulating

      • The development of better technology or improved operation, or

      • Buying credits to reduce emission in other sectors

    • Be easy to administer, monitor and enforce.

    • Ensure simple allocations of emission allowances

    • Not unduly distort competition and be non- discriminating of ship types and flags

    • Be difficult to evade

    • Be legally, politically and institutionally acceptable

    • Preferably be global and regulated by IMO


    Aviation ets scheme

    Aviation ETS scheme

    • All* flights to/from EU included as of 2012

    • Reduction 2012 3%, later 5% cut p.a.**

    • Operators must submit plans by 30.03.11

    • Use of revenues generated by auctioning allowances decided by EU by members

    • Complemented by technical/ operational CO2 reducing measures

    • Further unilateral and other agreements on global measures to reduce greenhouse gas emissions from aviation.

    • On 7 October the Environment Committee of the European Parliament called for shipping to be included in the revision of the European Union's Emissions Trading Scheme (EU-ETS).

    *smallest planes excluded

    ** Reduction target based of average emissions 2004-06

    Europe basis for shore based ETS - decided aviation ETS - shipping?


    Cap and trade

    Cap-and-trade

    On the "Cap and Trade" system was easy to implement for major sources of emissions, but harder to implement for the multitude of small sources. It is also giving rise to distortions and transactions costs. A key issue is how to allocate emission rights, which are a valuable asset, worth perhaps $2 trillion annually (or 5% of global GDP). This issue has become a major stumbling block in reaching a global agreement, and the attempt to avoid taking on full implications of this issue is one of the reasons for distortionary policies (or for carbon in different uses being priced differently).

    Joseph StiglitzNobel prize economics

    Professor at Columbia University (United States) Formerly Chief Economist at the World Bank


    Cap and trade1

    Cap-and-trade

    The quotas system has already contributed with investments in the non-Annex I countries which will reduce of CO2 emission by 1,800 m tonnes (1.2% annually) for the period 2008-12

    Word emission 2004 27,000 m ts, today some 30,000 m ts

    Carbon Point


    Levy on bunkers

    Levy on bunkers

    • Little support from governments

    • Sympathy from some ship owners organisations

    • Regarded as taxation

    The 400% increase in bunker prices over the last 4 years untilAug 2008 provided the shipping industry with a significant economic driver to improve its energy efficiency and thus reduce CO2 emission

    Prices HFO 380 CST, Fujairah


    Gasoline price at the pump

    Gasoline price at the pump

    Dollar per litre

    Levy


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    • Accidental oil pollution into the sea


    Tanker incidents and accidental pollution

    Tanker Incidents and accidental pollution

    ’000 ts pollution

    Number incidents

    Source: INTERTANKO, based on data from LMIU, ITOPF + others


    Accidental oil spills from tankers 1978 2008

    Accidental oil spills from tankers 1978-2008

    ’000 ts pollution

    Source: ITOPF + others


    Accidental oil pollution into the sea and tanker trade

    Accidental oil pollution into the sea and tanker trade

    1000

    ts spilt

    bn

    tonne-miles

    Source: INTERTANKO/ITOPF/Fearnleys


    Incidents attended by itopf over the past 5 years

    Incidents attended by ITOPF over the past 5 years

    Number

    Source: ITOPF


    Will history repeat itself

    Will history repeat itself?

    Or have necessary measure been implemented to ensure that catastrophes do not repeat themselves?

    Lack of good incident data prevent us from doing accurate analysis.

    Let’s look at some indications


    Will history repeat itself1

    Will history repeat itself?

    • Hull failure (?)

    • Tanker YearSpill tsLocation

    • Kirki 1991 17,280 Pacific, West Australia Lost bow

    • World Horizon 1991 850 Off South Africa Lost bow

    • Katina P 1992 74,000 off Mozambique

    • Tochal1994 200NW of Cape Town Lost bow

    • Thanassis A1994 20,000 700 km off Hong Kong

    • Nakhodka 199717,500Japan

    • Erika 1999 20,000 Off Britanny

    • Prestige 2002 63,000 Spain

    • New regulations/precautions:

    • Enhanced Special Periodical Survey Programme - adopted by the 18th session of the IMO Assembly in November 1993

    • DH requirements

    • Common Structural Rules (initiated by INTERTANKO)

    • Stricter vetting, age discrimination after ERIKA

    • Recorded hull failures/incidents:

    • 2002 7 (Prestige) + 2 minor spills 2006 3 1 2,000 ts spill

    • 2003 6 1 minor spill2007 9 1 minor spill

    • 2004 4 1 minor spill2008 3 zero spills

    • 2005 3 1 minor spill1Q09 1 zero spills

    Segregated Ballast Tank Coated Areas

    260,000 ton VLCC

    HULL TYPE Square Meters

    pre-Marpol 25,000

    Marpol 80,000

    Double Hull 225,000


    Will history repeat itself2

    Will history repeat itself?

    • Collision/Grounding/ContactTanker YearSpill tsLocation

    • BT Nautilus 1990 1,000 New York (contact reef bottom) - HFO

    • Athos I 2004 850Delaware River (contact object btm)

    • Al Samidoon 2004 9,000 Suez Canal (HFO)

    • Grigoroussa I 2006 3,000 Suez Canal (HFO)

    • Bright Artemis2006 4,500 East Indian Ocean (contact/rescue)

    • Hebei Spirit 2007 11,000 Off Korea (rammed by crane)

    • SKS SatillaDH2009 zeroOutside Galveston (ctct object btm)

    • New regulations

    • INTERTANKO US Port and Terminal Safety Study 1996/2002

    • INTERTANKO Terminal Vetting Database

    • DH requirements

    • Traffic separation schemes and other ship routeing systems have now been established in most of the major congested, shipping areas of the world, and the number of collisions and groundings has often been dramatically reduced.


    Will history repeat itself3

    Will history repeat itself?

    • Place of refuge

    • Tanker YearSpill tsLocation

    • Erika 1999 20,000 Off Britanny

    • Prestige 2002 63,000 Spain

    • Castor* 2000 zeroWestern Mediterranean Sea.

    • New initiatives

    • IMO Resolution A.949(23) after INTERTANKO initiative

    • EU directive

    • Under discussion in the US

    • *The ABS said the conclusions have implications for how ships are inspected and wider implications for how the new generation of double-hulled tankers should be built and maintained. At the least, the ABS said, rules should be amended regarding how and when ships are inspected and what surveyors should look for.


    Will history repeat itself4

    Will history repeat itself?

    Human failure

    On March 24, 1989, the tanker Exxon Valdez, en route from Valdez, Alaska to Los Angeles, California, ran aground on Bligh Reef in Prince William Sound, Alaska spilling 35,000 tonnes of Prudhoe Bay crude oil.

    Failure of navigation, deviation from separation zones (got permission to use inbound lane), inexperienced and tired officer on the Bridge, Captain who was in his cabin had been drinking alcohol.

    People do not work in a vacuum and the company culture, training, systems, procedures and technology has to be take into account that mistakes will be made.

    • INTERTANKO Human Element Committee

    • Guidance booklet on Seafarers’ Hours of work and Rest - 2008

    • Best Practice - Cadet Berths

    • Tanker Officers Training Standards (TOTS).


    Will history repeat itself5

    Will history repeat itself?

    • Fire and explosions

    • Tanker YearSpill tsLocation

    • Khark 5*1989 80,000185 km off Morocco

    • ABT summer ** 1991 260,000coast of Angola

    • .

    • Most important tanekr safety measure:

    • Inert Gas Stems IGS

    • Inerting double hull spaces in emergency situations

    • * Explosion following ballast tank leak

    • **Explosion due to leak from cargo tanks

    Kashmir due Jebel Ali after collision


    Will history repeat itself6

    Will history repeat itself?

    • Pilotage

    • Tanker YearSpill tsLocation

    • Aegean Sea*1992 74,000La Coruna harbor, Spain

    • Sea Empress**1996 72,000entrance to Milford Haven, Wales

    • .

    • New initiatives

    • INTERTANKO/BIMCO/ICS International Best Practices for Maritime Pilotage

    • * Grounded following loss of steering in bad weather

    • **Pilot misjudged tide (similar to Torrey Canyon 18 March 1967)


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    • Other challenges


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    Anti-fouling

    • Chemical Pollution

      • Tin-based antifouling caused:

        • Shell fish sex-changes, male to female

        • Thinning of oyster shells, collapse of oyster fisheries

        • Hormone changes in higher sea mammals

    • Anti-fouling Systems (AFS) Convention

      • Entered into force 17 September 2008

      • Tin-based systems banned

      • Mechanism to ban other biocides in the future

    • INTERTANKO

      • Move towards biocide-free systems

      • Comparison of silicon systems


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    Biofouling

    • Biological Pollution

      • Invasive species issue

      • Organisms on ‘niche’ areas of the hull

      • Air emissions issue?

    • Biofouling Management

      • IMO Voluntary Guidelines under development

    • INTERTANKO

      • Good practice

        • Reduce invasive species

        • Improve vessel performance – reduce air emissions

      • Support management guidelines

      • Ports must allow hull management operations


    Are tankers green maritime outlook middle east abu dhabi 7 april 2009

    Ballast Water Management

    • Biological Pollution

      • Invasive species

    • IMO Ballast Water Convention

      • Question over entry into force

      • Will the technology work?

      • Regional rules

    • INTERTANKO

      • Share information on experience with new technology

      • Management plans as standard practice for over 5 years

      • Understand and Implement the IMO guidelines

      • Ensure compliance by sharing information on regional and national regulations


    Environmental challenges

    Environmental challenges

    • Even in a bad market

    • High standards –

    • a precondition for good risk management

    Ms Littlefield (IUMI president)said there were strong signs that the safety culture at sea was taking root. But she warned Ship operators are being buffeted from all sides in the growing economic crisis. But to cut corners on maintenance or training can only have one result in the long term: more casualties, higher claims on insurers, and higher premium and deductible levels for shipowners.

    IUMI, in its first snapshot of 2008


    Cypriot oil tanker haven burning in the gulf of genoa

    Cypriot oil tanker "Haven" burning in the Gulf of Genoa

    The sea get sick, but it never dies

    Healing is a matter of time,

    But also of opportunity

    Greek proverbs

    Thank you


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