Sat | Sep 21, 2019

Jamaica growing as major bunkering hub and ready for IMO2020

Published:Tuesday | July 23, 2019 | 12:17 AM
Bunkering operation in Kingston Harbour .
Bunkering operation in Kingston Harbour .

With its geographical advantage, Jamaica is taking steps to become a true logistics hub for the Caribbean region. The projected increase in shipping traffic made possible by the widening of the Panama Canal, will provide the opportunity for Jamaica to capitalise on a greater demand for bunkers. In light of all this, on January 1, 2020, the International Maritime Organization (IMO) will implement a new regulation - dubbed IMO 2020 – where vessels will only be allowed to use fuel with a maximum sulphur content of 0.50 per cent as against the current limit of 3.50 per cent.

This measure is being implemented to reduce marine pollution and to improve the ecological footprint of the shipping industry.

Stating Jamaica’s readiness in anticipation of the expected changes to the bunker and shipping industries this IMO 2020 will bring, Rear Admiral Peter Brady, director general of the Maritime Authority of Jamaica (MAJ), shared some extended observations with bunker industry experts. He said that bunker suppliers in Jamaica are well under way to meeting the demand for compliant fuel. He also mentioned that the country is growing as a major bunkering hub in the region with three bunker suppliers operating out of the port of Kingston and the cruise ship facilities located on the North coast.

The director general explained that,over the last 24 months there has been an increase in maritime activities in relation to liquefied natural gas( LNG) facilities, dredging, and oil and gas exploration projects. This has been complemented by the increase in the size of vessels calling at the Kingston Freeport Terminal Limited as a result of the completion of the dredging of the main channel in Kingston to accommodate post Panamax container vessels.

“Along with these developments, there has been an expansion in storage facilities for the supply of bunkers. This was impacted by the coming into force of the United States Caribbean Sea ECA, covering certain waters adjacent to the coasts of Puerto Rico and the United States Virgin Islands, on January 1, 2014, That development had cause an increase in demand for low sulphur diesel by ships which trade with US and Caribbean ports, he said.

Brady said, “It is expected, and we are confident, that with the coming into force of the 2020 sulphur cap that the local bunker suppliers will continue to meet the demand for compliant fuel in the post-2020 period.”

Jamaica prepares for IMO 2020

Brady pointed out that as the regulator of shipping in Jamaica and the focal point for the implementation of MARPOL Annex VI, both as a port state and a flag State, the MAJ has taken steps to prepare for IMO2020. The authority has been engaged and involved in the rule-making process that impacts the development of the 2020 sulphur-cap measures at the IMO.

Brady said, “Administratively, the MAJ has established a Bunker Industry Oversight Committee, which is comprised of key regulators involved in the promotion and regulation of the bunker industry. The committee will continue to monitor the developments related to the 2020 sulphur cap and make recommendations to the Government in relation to the strategy to be adopted to position Jamaica as a leading bunkering hub in the Caribbean region. In accordance with the guidelines developed by IMO and adopted and promulgated by the Caribbean MOU on port state control, Public Service Commission (PSC) officers in Jamaica will be preparing to inspect facilities on board to ensure compliant fuel is in use, or the ship is equipped with mechanisms such as scrubbers to regulate the sulphur emission content for compliance with the 0.5 per cent requirement.

“PSC officers have, in fact, commenced an awareness campaign to increase consciousness among vessel operators who call at Jamaican and, indeed, Caribbean ports, by issuing vessels boarded, with a ‘Letter of Information’ similar, to what has been implemented in the Paris MOU region”, said Brady.

Brady went on to state that, “apart from advising of the imminent entry into force, the letter also highlights where emphasis will be placed during PSC inspections come January 1, 2020. For example, records of bunker delivery notes and associated samples or records; existence of written procedures on board covering fuel oil change-over operations, where appropriate; familiarity of Master and ship’s personnel with essential fuel oil management procedures; and that the ship has an appropriate approval for any installed exhaust gas cleaning systems, or equivalent, where required,” he said.

MAJ continues to meet with the major stakeholders in the private sector to determine their readiness for the coming into operation of the 2020 sulphur cap. Legislatively the MAJ has sent instructions for the development of legislation toimplement the amendments to MARPOL Annex VI and this draft legislation is in an advanced stage.

Caribbean Bunker Conference

Jamaica continues to play a leadership role in the implementation of MARPOL Annex VI in the region using its position as lead partner country under the IMO’s GLOMEEP project where it has carried out legal, policy and institutional reforms for the implementation of MARPOL Annex VI and is in a position to share its best practice with its regional neighbours.

The second Caribbean Bunker Conference and workshop, to be held in September 2019, hosted by Maritime Authority of Jamaica, in partnership with International Bunker Industry Association (IBIA), is positioned at a key point on the global IMO 2020 timeline when many vessels will have just started their transition to 0.50 per cent bunker fuels. This IBIA Caribbean Bunker Conference (ICBC) is therefore one of the first events where delegates can benefit fromthis real-world experience of IMO 2020’s impact.

Brady explained that key discussion points will be an exploration of what the impact of the IMO 2020 sulphur regulation will be for bunker buyers, suppliers, and operators in the region, particularly compliance solutions, enforcement, and the availability of new fuels.

“In addition to providing an understanding of the implications of the IMO 2020 changes for shipowners to suppliers, ICBC will showcase the current regional bunkering infrastructure and look at what the future holds for the Caribbean and the Americas bunker markets” he said.

With regard to Jamaica’s ambition as a bunkering hub in the post 2020 market, Brady indicated that the growth of bunkering is pursued as a major element of the positioning of Jamaica as a shipping Hub. Legislation in the form of the SEZ Act has been passed, which provides for bunkering companies to enjoy fiscal and other incentives to facilitate the growth of the sector.

Brady said, “The new sulfur rule as well as the need to meet future emissions goals mean the industry is also starting to look to alternative bunker fuels such as LNG. Although Jamaica has not yet established LNG bunkering facilities, the coming on stream of its LNG facilities in the country will clearly help position Jamaica as a major supplier of LNG bunkers in the region.”

IBIA Caribbean Bunker Workshop and Conference takes place from September 09-12, 2019 at the Iberostar Grande / Suites Hotel, Montego Bay, Jamaica, and is hosted by the MAJ and presented in partnership with Ship and Bunker.

For more information, including details on the full agenda, please visit: https://shipandbunker.com/events/icbc