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Maersk makes late scrubber run, set to increase HFO use by 150%

Maersk, the world’s largest containerline, is set to more than double the amount of heavy fuel oil (HFO) its fleet consumes by the end of the year.

During an investor call at yesterday’s 2019 results briefing, Maersk, previously in the anti-scrubber camp, revealed it is now signed up to a large number of exhaust gas cleaning systems.

Maersk’s current fuel consumption is split with 10% for 0.1% sulphur fuel covering ECA zones, 80% for very low sulphur fuel oil and 10% HFO. The plan, revealed yesterday, is to increase HFO usage to 25% by the end of 2020.

Maersk uses approximately 12m tons of bunker fuel annually so by the end of the year it could be using 3m tons of HFO, depending on scrubber fitting delays at Chinese yards brought about by the coronavirus.

The price differential between HFO and VLSFO has now ducked below $200 per tonne.

Maersk has gradually changed its stance on scrubbers. Initially against them, as the global sulphur cap approached it decided to buy around 30 scrubber kits to trial the technology. It has since committed far more to the devices, as have many of its peers, especially for larger boxships. 2M partner MSC is the liner to have invested most in scrubber kits, buying around 250 units so far.

More than 10% of the world’s containership capacity was fitted with scrubbers by the start of the global sulphur cap on January 1, with analysts at Alphaliner predicting the number could grow to some 1,000 ships – equating to 10m teu – by the end of 2022.

Also yesterday, Maersk CEO Soren Skou discussed how the coronavirus has been affecting his business with the Danish carrier cancelling more than  50 sailings since the Chinese New Year.

Skou warned that the world’s biggest ocean carrier is experiencing significant disruption at Chinese seaports due to the effects of the coronavirus outbreak.

“We are experiencing huge pressure at [Chinese] terminals because there aren’t enough workers at the ports to move the containers around, not enough truck drivers to move the goods, and no one to receive them at the factories or warehouses,” Skou said.

Skou said Maersk estimates factories in China are operating at 50% to 60% of capacity, predicting production would ramp up to 90% by the first week of March.

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Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

Comments

  1. “Something is rotten in the state of Denmark.”How does Maersk define Corporate Social Responsibility? Emphasis on short term corporate profits? What constitutes Corporate Responsible behavior in Denmark? Not drinking and driving? Aren’t these the same folks that led the race down the rabbit hole of bigger is better for box boats? And now a late embrace of an ocean polluting diversion machine so they can buy dirty “cheaper” fuel? Corporate will Include the external costs on that dirty fuel for the annual report yes? Big Blue is getting further from green? Some thing is indeed rotten in the state of Denmark as scrubbers are like the difference between a hawk and hand saw yes?ActaNonVerba

  2. Did Skou explain why the Q4 results had worsened from the previous year and why Maersk Line made a loss of $ 72m compared to a record profit for Hapag Lloyd?
    This doesn’t reflect too well on Mr Skou, who was in charge of Maersk Line previously, in spite of the Group’s good performance. Time to divest Maersk Line????

  3. The use of Open loop Scrubbers is in itself banned by most of the Countries and more are doing so. So, going by the feasibility of this, the longest run possible with Scrubbers was maximum 10 days in a 3 months period. The rest of the period the ship had to be on ULSFO.

    Moreover, the quality of Scrubbers installed was of such an inferior type that not a single day passed wherein something broke off and ruining the duty engineers life forever. When called for the shore technicians to permanently fix it, all they could come up with was, let’s try and experiment this, if it works well and good, if not(which definitely was the case), then we will come back with another set of hit and trial(in future).

    And with the installation of Scrubbers, the lack of conversion of a big dedicated tank for ULSFO meant immense quantity of Bunkerings of ULSFO at almost every Port possible.

    It’s a waste, pure waste of 1 million USD for each scrubber installed when Maersk already knows that not only Sulphur, but Greenhouse gases also have to be reduced.

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