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IMO 2020 Compliant Marine Oil Industry: A Comprehensive Research of the Market Scenarios Across the Globe

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BIS RSRCH
IMO 2020 Compliant Marine Oil Industry: A Comprehensive Research of the Market Scenarios Across the Globe

Ships are an effective way to move cargo and, at present, are responsible for carrying nearly 80% of the world’s goods (by volume). However, these are also one of the biggest threats to the ecosystem, climate, and human health. Shipping emissions have turned out to be one of the significant sources of air pollution in coastal areas and port cities, leading to health issues such as asthma, stroke, lung cancer, pulmonary, and cardiovascular diseases among the people living in these areas. One large and medium-sized container ship which sails with 70% load produces particulate matters (PM)2.5 equivalent of emissions produced from 21,000 National IV standard trucks.

As per IMO estimates, the shipping industry accounts for 2.20% of the GHG emissions, around 16% of global SOx emissions, and 14% of global NOx emissions primarily through the burning of residual fuels. Ship emissions are expected to contribute nearly 20% of total GHG emissions by 2050. To reduce airborne emissions such as SOx, NOx, ODS, VOC, and shipboard incineration from ships, the IMO implemented Annex VI to the International Convention for the Prevention of Pollution from Ships (MARPOL Convention).

Read Report Summary: https://bisresearch.com/industry-report/imo-compliant-marine-oil-market.html

To meet the environmental obligations, since 2005, IMO has established stringent requirements for a reduction in the sulfur limit. The adoption of the new IMO 2020 rule will reduce total particulate matter emissions, protecting up to 200,000 premature deaths over the next five years. It is also expected to prevent acid rain, which shall further lead to reduced crop failure, and harm to the forest and aquatic species. On October 26, 2018, the IMO adopted its pollution prevention treaty, MARPOL Annex VI, which will reduce sulfur oxide releases from shipping to 0.5%, down from3.5%, effective from January 1, 2020.

IMO 2020 is highlighted in the following section:

  • For ships running outside the designated Emission Control Areas (ECAs), IMO has set a limit for sulfur in fuel oil used on board ships of 0.50% m/m (mass by mass) from 1st January 2020.
  • Sulfurlimit for fuel oil used by ships operating in ECAs, designated by IMO, for the control of SOxhas been 0.10% m/m since 2015. Further establishment of ECAs has also been planned by IMO.

The obligatory rules require ship owners to shift to ultra-low-sulfur fuel, use LNG, or fit an authorized exhaust gas cleaning system (EGCS), also known as a scrubber, to eliminate the emissions before they are released into the atmosphere. The EGCS is mandated to be approved by the ship’s Flag Administration and demonstrated in the ship’s International Air Pollution Prevention Certificate. For LNG to become a viable fuel for a majority of ships, a global network of LNG bunkering terminals must be established. This will mark a substantial shift from the present scenario where 3.50% sulfur m/m fuel is considered the main fuel in the global industry that allows nearly 85% of international trade.

The IMO is also focused on making efforts to reduce air pollution and global warming for improving the health of the local population in the coastal areas. The shipping industry has conventionally used residual fuel oils, such as HFO, that are developed as a residue from crude distillation in refineries for marine bunkers. These residual fuel oils include sulfur, which, upon burning, ends up in ship emissions in the form of SOx.

For Report Sample, Click here: https://bisresearch.com/requestsample?id=794&type=download

The shipping industry is constantly facing several challenges as well as uncertainties while preparing for compliance with the sulfur cap. One of the main concerns is the availability of compliant low-sulfur fuel. Another major concern is regarding the installation capacity of shipyards in order to fit an adequate number of scrubber systems before the deadline. The new rule has created a risk as well as posed as a liability for shipowners with regard to compliance. In addition, the recent prohibition of open-loop scrubbers by many member states has further reduced the number of options available for ship owners.

Penalties for non-compliance have been determined in various port states, and include fines, arrest, and confiscation of the vessel. However, the implementation of MARPOL Annex VI could be difficult as flag states and port control authorities would require supervision vessels on a continuous basis. For the same, “sniffer” drones are being used in territorial waters to verify the compliance of ships.

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