Major bunkering ports around the world are groaning under the weight of enormous surplus supplies of heavy sulphur fuel oil with less than 260 days to get rid of much of it ahead of the January 1 global sulphur cap. One man has a solution, something he reckons could save owners vast sums and ensure no engine issues come next year.
David Lifschultz is the CEO of Genoil, a company whose Genoil Hydroconversion Unit, recently independently verified by Lloyd’s Register, is able to convert a high percentage of HSFO into LSFO with a conversion ratio of above 90% in relation to competitive technologies that are about 65% and 70%.
The technology has incorporated in recent years improved hydroprocessing catalytic cracking technologies made possible due to the development of new and advanced catalysts for a fixed bed reactor.
GHU produces fuel with the same properties of heavy fuel oil minus the sulphur content; essentially it is what shipowners are used to burning in their engines. This therefore reduces the risk of engine damage, which so many in the industry are concerned with in relation to the new hybrid distillate products that are coming onto the market.
In terms of other compliance solutions such as scrubbers, Genoil claims the operating cost alone of scrubbers is more than the total cost of the Genoil desulphured product including fixed and operating costs.
Genoil has come up with a financing model for its desulpurising unit. A shipowner or charterer – possibly through its bunker supplier or trader – commits to buy a certain volume at certain ports at a predetermined time and at a fixed price model, on which basis Genoil will take responsibility for finance and undertake all EPC work for the GHU.
“The refining industry does not intend to give the shipping industry a low cost solution but an expensive low sulphur light oil. We see Genoil as being the only company offering a heavy oil solution – and one that is compatible with all ship engines, which were designed for HFO,” Lifschultz says, adding that he anticipates MGO prices will “skyrocket” and the HFO price will collapse post 2020.
Lifschultz goes on to make the bold claim that he’s confident that average bunker fuel costs for the those shipping companies that use Genoil will be lower than the fuel costs they incurred before 2020.
