Friday, November 1, 2019

settling into the routine

As much as I wish I could stay home full time, I'm not enough of a prick that my company will pay for me to not go to work. I've been back for a few days, and have settled into the routine again. My first week back, I'm working nights, which is never fantastic, me being a day person, but I don't have trouble with circadian rhythms. If I've been up and moving about for 12+ hours, I can sleep. I'll make the adjustment back to working days next week.

 It's been a busy time here on the HQ. Lots of work. The whole maritime industry is struggling to adapt to new anti-pollution legislation that will change the type of fuel ships can burn after Jan 1 of next year. Refiners have added Very Low Sulfur Fuel Oil to the types of fuels sold to ships recently, and between finding storage space and vessels to move it, it's been an adjustment. With sulfur content being a huge deal in fuel (cost of the fuel is inversely proportional to the sulfur content), and fuel being the number one expense on ships, this is a big deal.  Now, terminals have to have stocks of Heavy Fuel Oil in 700, 500 and 380cst viscosity, as well as Low Sulfur Fuel Oil, Very Low Sulfur Fuel Oil and Ultra Low Sulfur Fuel oil.
Now, to an extent this can be offset by cutting fuel oils with Marine Gas Oil (a type of diesel fuel) to decrease viscosity or lower sulfur content, and therefore there could be ways to not need to rent 6 tanks for 6 grades of fuel, but this is offset by increased risk of contamination or improper blending by custom blending fuels for individual ships.

     Without going into massive detail, the greatest challenge I see here is getting the infrastructure in place to get the right grade of fuel to the right people at the right time. Currently there has been a dearth of berthing at fuel storage terminals to get fuels to ships. Only a modest percentage of ships have invested the millions of dollars in an exhaust gas scrubbing systems to allow them to burn high-sulfur fuel after the cut-off date of Dec 31. Everyone else will need LSFU or ULSFO... but this represents such a high cost to shipping, which is a VERY low-margin business, that many companies have been paralyzed, waiting until the last minute to see if things change, and this has led bunker suppliers like moi and co. to also not have a way to read the tea leaves, too. Now, my particular dog in this fight is not a big one- I sign my name to documents that certify that as far as I know I'm giving a ship fuel in compliance with the law, but it's my employer and the oil majors who have their asses in the breeze here. Recently, some of our barges have been flushed out and put into exclusive service for low and ultra-low sulfur fuel. Currently, the HQ is probably going to carry the heavy stuff still, which is fine for me.

 I'm as curious as anyone as to what will happen Jan 1.

1 comment:

JayNola said...

My favorite part is the massive increase of the numbers of barrels of oil it's going to trigger. Limiting yourself to being able to use only distillates means about half of every barrel of oil is no longer usable without some amount of tinkering or after treatment.