Ports countdown to IMO 2020

The frenzied build-up to the big day is evidenced by multiple conferences, presentations, webinars, email briefings and social media posts on the subject. Notwithstanding all the expert speak, the exact costs of fuels, and their availabilities on 1 January 2020 are big unknowns. Instead of relying on the punditry, I would point readers towards settle prices of newly-launched futures contracts on the differentials between low sulphur fuel and higher sulphur bottom-of-the-barrel-type grades.

Ports will be playing an important role in what might be a big, complicated mess. In past columns, I’ve suggested that ports get involved in efforts aimed at enhancing the fuelling infrastructures where possible. But now, it’s increasingly clear that the regulatory lens will actually zoom in on such things.

An aspect of IMO 2020 receiving a great deal of scrutiny concerns the actual availability of fuel in specific ports given uncertainties regarding refinery production and things like compatibility of various “blends” with vessel engines. The IMO (International Maritime Organization) has recently weighed in on the subject of ominous-sounding Fuel Oil Non-Availability Reports (FONARs), saying that a lack of compliant fuel availability could exempt owners from burning the low sulphur grades, albeit briefly, for example for the next leg of a particular voyage.

Local port state control (typically Coast Guard or similar) will be under pressure from above — think of the folks with stars on their shoulders, at district offices, or at headquarters — to make sure that rules are being properly enforced. Think of it as scrutiny on steroids.

On a practical basis, local administrations ought to be sounding out their local stakeholders, including bunkering terminals with pipeline hook-ups, barge providers and storage facilities, on whether all the supply and communications pieces are in place. Organising informal gatherings of all concerned may also be appropriate.

To be clear, getting familiar with the close-in details of fuelling or facilitating the communications of industry players are certainly not legal obligations for ports. But, in a world where the rumour mill now plays out on social media with minimal time lags, being proactive on everything fuel-related will help burnish port reputations and smooth vessel calls.

With possible fuel supply uncertainties, reputational damage is a real possibility. Port directors should strive to divert all those FONARs and whatever other horrible acronyms come along in the next 300 days, to other ports, up and down the coast, and concentrate on making bunker operations run as smoothly as possible on their own waterfronts.