Officially known as Annex VI to the MARPOL 73/78 Convention, the proposed legislation will limit emissions of SOx, NOx, and VOCs. Control of the two latter emissions fall outside the scope of this paper, since neither is significantly influenced by bunker fuel quality.
Once ratified by member governments, Annex VI will impose a global cap of 4.5% sulphur on all residual bunker fuel oil. The impact of this is likely to be minimal to both refiner and end user. In areas of high marine traffic density however there is acknowledgement that there may indeed be need for more restrictive controls on sulphur level. Thus the IMO has adopted a principle of special "Emission Control Areas" (ECAs) where a sulphur cap of 1.5% will apply. Any country can apply to be granted ECA status, but in order to qualify, clear scientific and economic justification must be demonstrated. To date, only the Baltic Sea and the North Sea have applied and successfully met the required criteria.
Note that these controls win only apply twelve months following ratification of the Annex. Ratification requires 15 countries (out of 137 + represented at IMO), between them representing 50% of the world's tonnage, to signify acceptance. In the three year period that the Annex has been waiting ratification, only two countries have become signatories. Whilst no specific target date was set by the IMO, it wisely recognised (from experience) that ratification would not necessarily be a fore gone conclusion, and pronounced that if the Annex was not ratified by 31 December 2002, it would review the ratification criteria. Given the response to date, it is becoming increasingly obvious that this course of action is likely to be necessary. (Even if all the EU countries were to become signatories, ratification would still fail on the tonnage criteria).
Thus the implementation date for the IMO legislation remains unclear, but will realistically be somewhere post-2004. Whether those countries more passionate about environmental controls have the patience to wait that long remains to be seen, and some degree of unilateral action may threaten. Certainly there are a number of influential marine customers who are not willing to wait - already there are a significant number of enquiries for bunker suppliers to make available low sulphur bunker fuel on a long term basis. The end user is prepared to voluntarily pay the premium to be more environmentally conscious well ahead of any mandatory requirement. It is not impossible that the move to use of lower sulphur bunker fuel is driven, or at least accelerated, by user requirements rather than by any legislation.
Perhaps an indicator of the determination of Goverments to implement emission control legislation is seen in Europe, where the European Commission has implemented the Sulphur in Liquid Fuels Directive (SLFD). Primarily aimed to encompass all inland fuels, the scope of the Directive extends to cover marine gas oils and marine diesel fuels. Whilst there are a number of derogations, sulphur levels of marine distillate fuels used in the EU are now limited to a maximum of 0.2%S. The scope of the SLFD however specifically excludes residual bunker fuel oils, recognising the role of the IMO as the international legislator in the marine sector. Nevertheless, if the IMO fails in it's bid to implement Amex VI, then an extension of the scope of the SLFD in Europe cannot be ruled out. Similar pockets of regional legislation may also be expected to appear.
I do not intend to begin suggesting how the refining industry may meet the emerging demand for low sulphur bunker fuel oil - a number of alternatives exist which may suit individual refiners. As put of the monitoring process however, the refiner will be mandated to provide the buyer with documented evidence in the form of a "Bunker Delivery Note" stating the sulphur content of the fuel as delivered. This must be accompanied by a representative sample of the fuel oil. Most reputable suppliers already provide this service on a voluntary/contractual basis, but post-implementation of Annex VI, this will be a legal requirement. The ship owner will be required to retain the sample for one year, and the Delivery Note for three years as proof of compliance. In the short/medium term, ship operators trading internationally may carry two grades of bunker fuel oil, one for deep sea use, and the other a low sulphur fuel for use in restricted zones.
Conclusions.
The last fifteen years has been a period where significant differences have developed in the demand patterns for the various products of oil refining; this has been accommodated by an increased usage of catalytic and thermal secondary conversion processes. These developments have had a direct impact on the quality of the marine fuel oil pool by promoting a gradual shift away from low viscosity grades to grades of higher viscosity, density, carbon residue, sulphur, and ash content. But rapid improvements in diesel engine technology have enabled the heavier fuels to be utilised without undue difficulty.
The quality of the fuels produced around the world varies, which can be a problem particularly for the bunker market where ships encounter fuel of varying quality even when bunkering at the same port. Viscosity on its own can no longer be considered an indicator of quality, and International Standards have developed to give both supplier and buyer a means of classifying fuel quality as supplied.
To some extent, the same trends are expected to continue into the future as oil refiners seek to satisfy an increasing demand for middle distillate aviation and diesel fuels. However, there is unlikely to be significant pressure for the introduction of marine fuel oils whose properties exceed the limits now stipulated in International Specifications. Indeed, environmental considerations may, in time, result in pressure to tighten some of these limits.
It is envisaged that the usage of even heavier marine fuels will gradually become more widespread causing a shift in emphasis towards the upper end of the now well-established and well defined grade structure. Fuel oils will continue to be produced across the whole spectrum of the specification range to cater for the wide variety of end user requirements. But to achieve the maximum economy of operation ship-owners should select the heaviest grade on which their vessel can safely operate.
