Positive Environment News

Ship Switch to Diesel Fuels Uneconomic - EUROPIA

Date: 13-Dec-07
Country: UK
Author: Stefano Ambrogi

Shipping circles are debating how to reduce harmful sulphur dioxide emissions, which cause acid rain, respiratory illnesses and heart problems.

Part of the industry, led by the independent tanker owners organisation Intertanko, wants a total ban on high-sulphur marine fuels in favour of cleaner-burning distillate fuels.

Martin Maersk Suenson, executive officer of the European Petroleum Industry Association (EUROPIA), said the idea "did not make any sense" environmentally or economically.

"It is not a cost-effective way to improve the environment," he told an emissions conference in London.

He said the shift risked raising carbon dioxide (CO2) emissions in the manufacturing process -- an opinion echoed by ship industry bodies like the International Chamber of Shipping.

Intertanko, citing a variety of technical reasons, says the switch would be neutral at worst in terms of emissions of CO2, the gas believed to be chiefly responsible for man-made climate change.

Suenson said the oil market impact alone would likely more than double the cost of marine fuels and substantially increase prices of diesel, aviation jet fuel and heating oil on land.

Moreover, the switch would require refineries to produce an extra 200 million tonnes of distillate fuels a year, equivalent to around 600 million tonnes per annum of crude.

"That's more than the annual production of Saudi Arabia," he told the conference.

Suenson said the move would require large-scale investments by refiners, a process that he said could only be gradual and take between 20 to 30 years to complete.

"Distillate fuels and residual fuels would need to co-exist in the market for a long time...significant price differences would require international compensatory mechanisms to avoid competitive distortions," he said.
(Reporting by Stefano Ambrogi, editing by Anthony Barker)

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