Ship operating costs expected to rise in 2018 and 2019

Total vessel operating costs in the shipping industry are expected to rise by 2.7% in 2018 and by 3.1% in 2019, according to a survey conducted by Richard Greiner for Moore Stephens UK.

The Future Operating Costs Survey revealed that drydocking is the cost category likely to increase most significantly in both 2018 and 2019, accompanied in the latter case by repairs and maintenance. The cost of drydocking is expected to increase by 2.1% in 2018 and by 2.3% in 2019, while expenditure on repairs and maintenance is predicted to rise by 2.0% in 2018 and by 2.3% in 2019. The increase in expenditure for lubricants is expected to be 1.9% in 2018 and 2.1% in 2019.

Meanwhile, projected increases in spares are 1.9% and 2.2% in the two years under review, while those for stores are 1.6% and 1.9% respectively.

The survey also revealed that the outlay on crew wages is expected to increase by 1.3% in 2018 and by 1.9% in 2019, with other crew costs thought likely to go up by 1.5% in 2018 and by 1.8% in 2019.

The cost of hull and machinery insurance is predicted to rise by 1.3% and 1.6% in 2018 and 2019 respectively, while for protection and indemnity insurance the projected increases are 1.2% and 1.4% respectively.

Management fees, meanwhile, are expected to increase by1.0% in 2018, and by 1.2% in 2019. The predicted overall cost increases were once again highest in the offshore sector, where they averaged 4.1% and 4.2% respectively for 2018 and 2019. By way of contrast, predicted cost increases in the bulk carrier sector were 1.8% and 2.6% for the corresponding years. Operating costs for tankers, meanwhile, are expected to rise by 2.4% in 2018, and by 2.9% the following year, while the corresponding figures for container ships are 4.2% and 3.8%.

Read more: https://www.moorestephens.co.uk/news-views/october/ship-operating-costs-expected-to-rise-in-2018-and

Full Survey report: https://www.moorestephens.co.uk/MediaLibsAndFiles/media/MooreStephensUK/Images/DPS41806-Future-Operating-Costs-Survey-2018_v2.pdf?ext=.pdf

 

MEPC 73rd Session

The MEPC approved the Programme of follow-up actions of the initial IMO strategy on the reduction of GHG emissions from ships up to 2023. The programme of action is intended to be used as a planning tool in meeting the timelines identified in the initial IMO strategy, which was adopted in April 2018. The Committee invited concrete proposals on candidate short-term measures to the next Committee session, MEPC 74 (May 2019), for consideration, as well as on the procedure for assessing the impacts on States. Albion Marine Solutions supports the outcomes of the IMO MEPC.73 session.

Read more: http://www.imo.org/en/MediaCentre/MeetingSummaries/MEPC/Pages/MEPC-73rd-session.aspx?platform=hootsuite

 

 

No time to install scrubbers before 2020

Shipowners need to plan and budget for 2020 Sulphur cap compliance. Most of vessels on international trade will require some degree of upgrades to their machinery and system. Albion Marine is being busy with preparation of upgrade engineering plans for a number of reputable shipowners.

 

Regulatory bodies around the world are trying to address the impacts 2020 Sulphur cap would have post implementation. New challenges and issues are emerging as the date is coming closer. With 15 months left to implementation, there is no time now to plan for the installation of Exhaust Gas Cleaning Systems to meet the regulations right from January 2020. Most shipowners have no choice but to choose low sulphur fuel oil to comply, hoping the suppliers will deliver.

Some believed that the date of implementation might get delayed while some wanted to see what the ‘competitors’ are going to do. The silence from the refineries and the bunker suppliers did not help either, but it is safe to say that the expected demand of low sulphur fuel will not be matched in 2020.

Considering the time at hand, only a minor percentage of shipowners will have scrubbers installed onboard their vessels by January 2018.

Scrubbers have been termed as ‘outdated technology’ and many articles have concluded that scrubbers might not even be required in the long run. All these conclusions are based on assumptions that the alternate fuels will be made available in abundance within 1-2 years from the date of implementation. It is time for the shipowners to review their strategy and spare a thought to a possibility that scrubbers might be the best solution for next half a decade

Albion Marine completes another project successfully

Moving ahead with the semi-annually sampling process of over 144 sites on the north coast of Canada, upon successful completion of similar sampling project in Nov 2017 and March 2018, our team was asked to visit a list of 144 sites this time around.

Having carried out the same project for Environment Canada in November 2017 and October 2018, a detailed work plan and strategy to deliver this project within the required timeline was prepared. Our team was well prepared for the challenges but also with a zeal to further raise the bar by safely completing the project with a higher percentage of efficiency. Therefore, the decision to use the same team, including the aircraft pilot, who conducted the operation the last time was considered best. The sampler was again well briefed about the challenges, expectations, lessons learnt from the previous operation as well as underwent a revision training at the PESC facility in sample collection training.

This was Albion Marine Solutions 3rd such project and there would be 3 more to come till 2020. Also, that this time it was done the fastest in just 2.5 days flat, exceeding the expectations of the client, Environment Canada (EC)

 

IMO deal charts course to 'at least' halve emissions by 2050

IMO’s Marine Environment Protection Committee (MEPC) has set out an agenda of action points for its member states as they begin to discuss and attempt to define the measures they will take to meet the initial greenhouse gas (GHG) emissions-reduction framework targets agreed at MEPC 72 in April 2018. Albion Marine supports Canada’s active position on targets for reductions of GHG emissions.

More info: https://www.mpropulsion.com/news/view,imo-agrees-next-steps-for-ghg-strategy_55634.htm?utm_source=news&utm_medium=news&utm_campaign=MP18-10-25&utm_content=4