Shipowners face delays, higher costs for bunkering in Singapore pre-IMO 2020
News // 11.19.19
Written by Michael Juliano
Some shipowners claim retrofitting of exhaust gas scrubbers is on schedule for IMO 2020, but others may not be so lucky — due to poor planning.
Seanergy Maritime foresees no delays in having scrubbers installed on half of its small fleet before midnight on 31 December, chief executive Stamatis Tsantanis said.
The New York-listed Greek owner of 10 capesize bulkers expects China's YiuLian Dockyards to install scrubbers on five ships by 20 December for $16m in total, he said.
However, other owners are experiencing setbacks as a result of poor planning by cheaper scrubber manufacturers, he told TradeWinds.
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"Each project consists of a big number of subcontractors, so what we understood was the issue by many companies was the coordination of all such components," Tsantanis said.
In addition, each party sends their own service engineering teams, excluding the vessel's crew and the shipyard’s workforce.
"It’s basically the Tower of Babel."
He said some retrofit projects drop in priority at the yards because many manufacturers do not have enough experienced supervisors to oversee the work, adding that a lack of crew know-how on scrubbers also has added to the delays.
It’s always easy to blame the ‘overcapacity of the Chinese yards’ but in reality the problems arise from other factors as well
Stamatis Tsantanis
"It’s always easy to blame the ‘overcapacity of the Chinese yards’ but in reality the problems arise from other factors as well," he said.
"We did experience a minor budget overrun and some delays, although we were initially conservative with our estimates to avoid any surprises."
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Tsantanis said he visited Yiu Lian three times to check on installation of the scrubbers, which use a horseshoe configuration to remove sulphur from the exhaust.
"We consider Hyundai as top producer and we ordered the U-type [open-loop] scrubber, which in our opinion is safer for operations in the long run," he said.
Scrubber advocates Exhaust Gas Cleaning Systems Association and Clean Shipping Alliance 2020 did not immediately respond to requests for comment.
Manufacturers Alfa Laval, Wartsila and Yara Marine Technologies, which together hold half of the world's market share, did not respond to inquiries on retrofitting times.
Scrubber-fitted ships set to almost double by 2021
There are 1,945 ships currently fitted with scrubbers, according to Clarksons Research, representing 2% of all vessels and 10% of 1.46bn gt worldwide.
In the capesize sector, 343 vessels, or 19% of the global fleet, have the kits installed.
Among VLCCs, 143 ships, or 18% of all such vessels on the water, have scrubbers onboard, according to Clarksons' data.
About 2,150 ships totalling 160m gt — 11% of the world fleet — should be retrofitted by the end of this year, as about 250 vessels totalling 20m gt per month have been fitted in recent months.
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By the end of 2020, about 3,800 ships — 19% of the world's fleet by tonnage — should have scrubbers installed, including 34% of VLCCs, 36% of capesizes and 50% of boxships.
The number of ships undergoing scrubber retrofits has risen to 247, as of 11 December, from 27 at the beginning of the year.
Installation times for scrubbers have increased to about 45 days from 30 days as yards, especially those in China, get bogged down with orders, Clarksons Research managing director Stephen Gordon said.
'It's been a mess'
New York-listed Safe Bulkers is on schedule to install 19 open-loop scrubbers on its fleet of 38 ships by 1 January and a 20th in 2020's first quarter, chief financial officer Konstantinos Adamopoulossaid.
But like Seanergy, he expects that a number of other owners will miss attempts to make the IMO 2020 deadline as a result of insufficient planning.
"Some spare parts are missing, and it's been a mess," he told TradeWinds.
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Scrubber retrofits for the Polys Hajioannou-led company have taken about 35 days on average at Cosco Guangzhou Shipyard, he said.
Workers for scrubber manufacturer Alfa Laval and the yard installed a few of them as quickly as 27 days, he added.
"They're getting faster at it," he said.
'Significant' delays
Scrubber installations are actually taking almost twice that amount of time because of the unforeseen complexity of retrofitting a scrubber, Enerjen Capital chief executive Stephen Schueler said.
"When everyone signed up to do this, they thought they would be in an out in 30 days," he told TradeWinds, citing Alphaliner data.
"It has taken 58. That's significant.”
"Because of that, some vessels will miss the January 1 deadline and roll into the next year."
He recommended that owners order scrubbers only for new buildings but not their present fleet, given how much longer the installations take.
"I'd think twice about that," he said.
"There's a tremendous opportunity cost with a retrofit."