Scorpio Tankers Expects 62 Scrubber Installations by 2020

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  • Scorpio Tankers to fit 62 of its vessels with scrubber systems to comply with IMO 2020 sulphur cap.
  • Scorpio to pay $1.5 million-$2.5 million per vessel to retrofit another 75 vessels, with 60%-70% of the costs being financed from external sources.
  • At a $200/mt spread between HSFO and 0.1% MGO, $1.22 million/year for the LR2s, $1.02 million for the LR1s and $908,400 for the MRs are expected to be saved.
  • Forecast is totally 2,200 ships will have scrubbers fitted by 2020, consuming 550,000 b/d of fuel oil.

Scorpio Tankers expects 62 of its vessels to be fitted with scrubber systems to comply with the IMO’s 2020 sulphur cap, reports Platts.

When the IMO’s sulfur limit drops to 0.5% from 3.5% at the start of next year, ships with scrubbers will be able to continue burning fuel oil rather than switching to cleaner expensive alternatives. The systems work by spraying water into the vessel’s exhaust to remove sulfur.

Vessels awaiting retrofits

The New York-listed firm expects 25 of its MR tankers, seven LR1s and 30 LR2s to have the systems fitted by the end of 2019. In total, the company owns or leases 109 refined product tankers.

Scorpio plans to fit scrubbers to 75 of its ships in total, the company said. It expects to pay $1.5 million-$2.5 million per vessel, with 60%-70% of these costs being financed from external sources.

Scrubbers seen cost effective

At a price spread of $250/mt between HSFO and 0.1% sulfur marine gasoil, Scorpio expects to save about $1.53 million per year for each of its LR2 vessels with scrubbers, $1.27 million for each LR1 and $1.14 million for its MR tankers.

At a $200/mt spread it expects to save $1.22 million/year for the LR2s, $1.02 million for the LR1s and $908,400 for the MRs.

S&P Global Platts Analytics forecasts a total of 2,200 ships will have scrubbers fitted by the start of 2020, collectively consuming 550,000 b/d of fuel oil.

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Source: Platts

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