IPIECA and the Oil Companies International Marine Forum (OCIMF) submitted a joint paper on the issue of fuel availability last week at the International Marine Organization’s Marine Environment Protection Committee (IMO MEPC) 68, the IPIECA website said.
Part of the meeting’s discussion included a review of IMO's future study that will assess whether there is adequate fuel for ships to meet the 0.5% Sulphur cap. The IMO will use the results of the study to determine whether the new regulation should take effect in 2020 or 2025.
At the meeting, IPIECA highlighted that projecting refinery capacity to meet global demand is a complex issue with many interdependent variables. More specifically, the IPIECA – OCIMF paper calls on the IMO to consider:
- The reaction of the market to decisions made by the global refining industry. Historically, individual refineries have made investment decisions based on demand patterns from market signals.
- The limited flexibility of refineries to modify the range of products they make. Modifying their configuration affects the output of other petroleum products - this will need to be considered carefully in the fuel availability study to ensure no sector of the economy runs dry.
- The Emission Control Areas (ECAs) specifications required an increase in marine distillate production of incremental year-on-year growth of overall distillate demand in the past decade. For the upcoming global cap of 0.5%, the volume of fuel affected will be significantly higher.
The IPIECA – OCIMF paper suggests that these aspects should be taken into account for the fuel availability study to ensure that the IMO makes a robust and well informed decision about the 0.5% Sulphur implementation date. IPIECA’s suggestions have been well received.