NORDEN announces significant investment in scrubbers

NORDEN announces significant investment in scrubbers


Shipping company NORDEN is to invest $54m in the installation of 26 scrubbers ahead of the 2020 global cap of sulphur emissions from bunker fuel.

On January 1, 2020, the cap will come into effect, reducing the allowed sulphur content from the current level of 3.5% to 0.5%. Compliance with the regulation can be achieved either by switching to low sulphur fuel or by installing an exhaust gas scrubber on vessels enabling continued use of high sulphur fuel oil. 

Throughout the last 18 months, NORDEN has evaluated how the sulphur cap will affect both the shipping and bunker markets. “The cost difference between low sulphur and high sulphur fuel oil is expected to increase significantly for a sustained period, making scrubbers an attractive choice for compliance,” the company stated in its Q2 report.

Therefore, NORDEN has during 2018 secured installation of 26 scrubbers with options for five more. Of these, two scrubbers will be installed on newbuildings, 16 retrofitted on selected, owned vessels, and the remaining eight will be installed on long-term chartered tonnage. 

The costs are estimated to amount to approximately $41m on owned vessels and approximately $13m in increased TC hire over the coming years. Recognising uncertainties, NORDEN considers the investment highly attractive with an estimated financial return of approximately 25% within 5 years on own vessels with significant upside.

For more information, visit: www.ds-norden.com

28th August 2018

 

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