- Tanker owner Frontline buys 20% share of a scrubbers company.
- The move came at a time when scrubbers have become the niche solution for the 2020 sulphur cap.
- This deal will empower 14 tankers of Frontline with Scrubbers while another 22 are in the pipeline.
With 2020 sulphur emission cap fast approaching, scrubbers and scrubbers company are getting momentum. Recently, the Bermuda-based tanker company Frontline has bought a 20% stake in a scrubber manufacturing company, reports Platts.
Scrubbers for Tankers
Frontline has ordered the equipment for 14 of its vessels to allow them to continue using fuel oil after tighter emission standards come into effect in 2020.
The shipowner has bought a 20% stake in Feen Marine Scrubbers, it said Thursday without disclosing the sum it paid, and has agreed to order scrubbers for 14 of its tankers with the option to order another 22 at fixed prices.
The Scrubbers Solution
The International Maritime Organization’s global marine fuels sulfur cap is set to drop from 3.5% to 0.5% at the start of 2020, forcing shipowners either to switch to cleaner, more expensive fuels or to install scrubbers to clean their emissions on board the vessel.
Scrubbers have largely been regarded as a niche solution in 2020, but have increased in popularity in recent months as shipowners bet on a sharp difference in prices between fuel oil and 0.5% sulfur bunkers.
The Economic Case for Scrubbers
“The economic case to install scrubbers is very compelling, particularly for larger vessels,” said Frontline CEO Robert Hvide Macleod. “This transaction allows Frontline to secure the capacity to secure a large volume of scrubbers, which we believe will present a challenge to many owners as the deadline for sulfur emissions compliance approaches.”
The Oslo- and New York-listed company, with main shareholder John Fredriksen at the helm, has one of the world’s largest fleets of VLCC and Suezmax tankers as well as Aframaxes/LR2s, with 63 vessels in its fleet and two VLCC newbuildings under construction.
Feen Marine has also previously sold scrubbers to shipowners including Navig8 and Trafigura, the company said.
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Source: Platts
