China Marine Bunker (PetroChina) Co Ltd, known as Chimbusco, has agreed a one-year supply deal with a COSCO Shipping Corp unit for low-sulphur marine fuel that meets new global environmental rules, according to a Chimbusco statement posted on a social media platform.
A Chimbusco executive said on Thursday that the marine fuel company will supply 500,000 tonnes of low-sulphur fuel oil in 2020 to COSCO Shipping Lines Co Ltd, a unit that operates container vessels for the China shipping conglomerate.
The executive said the 500,000 tonnes makes up half of the annual marine fuel demand at Chinese ports by the whole fleet of COSCO Shipping Corp, adding that Chimbusco expects to source most of the supplies from imports.
COSCO operates a fleet of 1,274 vessels, with a combined carrying capacity of 102 million dead-weight tonnes, the world’s largest, according to the group’s website. The fleet includes 480 container ships, 418 dry bulk vessels and 195 oil tankers.
The executive also said “a tiny percentage” of COSCO Shipping‘s fleet have installed sulphur-stripping scrubbers.
In a global effort to combat air pollution from the shipping industry, International Maritime Organization (IMO) rules will ban ship from using fuels with a sulphur content above 0.5 percent from 2020, compared with 3.5 percent now unless they are equipped with so-called scrubbers to clean up sulphur emissions.
China’s state-run refineries have in recent months started pilot production of low-sulphur fuel ahead of the IMO rule taking effect next year, and a Sinopec executive has asked the government to introduce tax rebates and a quota system to boost output of the cleaner fuel.
Reuters