Steamship Mutual has gathered all the crucial information needed in light of the upcoming 2020 sulphur cap, as many are the issues that may arise and some guidance will be helpful. The Club notes that this is not a comprehensive checklist, but a summary of the steps that have to be taken so that shipowners are fully compliant with the future regulations.
Standard Club’s Charles Brown, Head of Claims, comments that in the context of a subsequent investigation into potential breach, the positive of a comprehensive plan can easily turn into a negative if the evidence shows it has not been implemented effectively.
Charters: Issues on cost and time of installing bunkers have hypothetically been restored. Then follows the change to supply of compliant fuel in service on the latter.
The Club poses specific questions that each charterer should have answers to when switching to compliant fuel:
- What are your time charterer’s obligations?
- Are fuel specifications and sampling and testing procedures adequately addressed?
- Whilst responsibility for machinery damage due to defective bunkers may be clear, what is the position concerning consequential issues such as deviation to obtain replacement bunkers and disposal of unusable bunkers on board?
Bunker supply contracts: Casually, these contracts are one-sided, with limited warranties and provide short time limits for notifying claims.
When a vessel is trading frequently, the Club recommends that they should ensuring not only the availability of compliant bunkers, but also quality requirements: Specification, characteristics, stability, compatibility. Where possible, sourcing, sampling procedures and testing methodology should also be investigated.
Management of bunkers onboard a vessel
Although many crews are experienced in bunker segregation from the use of low sulphur fuels in ECAs, it will be better to consider enhanced procedures addressing:
a) Bunker tank allocation and cleanliness
b) Stem segregation
c) Usage including:Engine manufacturers’ recommendations
d) Recording issues arising in use
e) Notification of claims
If problems materialise, it is essential to ensure that potentially defective bunkers remain segregated on board and that an alternative segregated stem is available for use.
Bunker disposal
High Sulphur bunkers have to be removed from non-scrubber equipped vessels by 1st March 2020.
FONAR and compliance issues
The provision for a fuel non-availability report (FONAR) to be submitted acknowledges the possibility that circumstances may arise where it is effectively impossible to achieve compliance because low sulphur fuel is unavailable where and when bunkers are required.
BIMCO recently highlighted that FONAR has to be the last option for a shipowner concerning fuel compliance; It is a factor that enforcement authorities may consider in deciding whether to proceed against a vessel or assessing any penalty that may be imposed.
Scrubber equipped vessels
The Club proposes that consideration needs to be given as to how scrubber restrictions on use can be addressed, as there are some ports that have already banned scrubber discharges.
Availability of Club cover
The ‘expected’ P&I risk insured by the Club is the imposition of fines for non-compliance, something that IMO’s attempts to ensure full compliance may prevent them and that PSC authorities will be realistic and reasonable, nevertheless there is a risk that breaches will occur and penalties will be imposed.
