Australian consultation on low sulphur fuel

We are the Australian Government agency responsible for implementing the 1 January 2020 low sulphur fuel regulation as set out in the International Convention for the Prevention of Pollution from Ships (MARPOL).

To aid in implementing this regulation, we have engaged with stakeholders on the implementation of the sulphur limit. Consultation is occurring through roundtable discussions and direct consultation.

Sulphur roundtable sessions

These discussions have provided opportunities to hear about the IMO’s work on implementing the 1 January 2020 regulation. The roundtables helped direct Australia’s contribution to this work, raise issues and discuss solutions with the industry sectors preparing for the transition.

It is important to discuss and share information as it becomes available. If you are interested in being involved in discussions on the Australian implementation of this regulation, contact us.

The outcomes from previous roundtables are reported below.

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October 2019 Roundtable – Session 8

AMSA and MIAL hosted the eighth Sulphur Roundtable in Melbourne on 31 October 2019.

This roundtable discussed issues to be considered at the 7th session of the Sub-Committee on Pollution Prevention and Response (PPR 7), the 75th session of the Marine Environment Protection Committee (MEPC 75) and the 102nd session of the Maritime Safety Committee (MSC 102).

Other topics discussed included:

  • Port State Control in Australia.
  • Amendments to Australian Commonwealth legislation.
  • The work of the Missions to Seafarers.
  • Potential impacts of Exhaust Gas Cleaning Systems (EGCS) in coastal waters, the work of the IMO on EGCS.
  • Australian Government work on low sulphur fuel price impacts.

IMO updates

The group noted that:

  • The draft amendments to MARPOL Annex VI concerning procedures for sampling fuel oil and the verification of the sulphur content are expected to be adopted at MEPC 75. These amendments were approved at MEPC 74. Once adopted, these amendments will clarify fuel oil sampling and verification procedures for MARPOL Annex VI samples, for both fuel in use and carried by the vessel for use.
  • PPR 7 is expected to further consider and prepare new guidelines for sampling of fuel oil that is carried by the vessel for use. This issue was previously considered at MEPC 74.
  • The report of the Correspondence Group on Data Collection and Analysis under Regulation 18 of MARPOL Annex VI will be submitted to MEPC 75. This Group was established at MEPC 74 and has looked into improving the MARPOL Annex VI module in the IMO’s Global Integrated Shipping Information System (GISIS); specifically, the section containing the notifications under Regulation 18 of MARPOL Annex VI on fuel oil availability and quality.
  • The report of the Correspondence Group on Fuel Oil Safety will be submitted to MSC 102. This Group was established at MSC 101. The group noted the progress made by this Group to date, including that an overwhelming majority of participants agreed that requirements should be developed for reporting cases where fuel oil suppliers have failed to meet the flashpoint requirements.

Port State Control in Australia

The group noted that AMSA’s port State control officers (PSCO’s) will conduct inspections in line with normal port State control practices taking into account the 2019 Guidelines for consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI and the 2019 Guidelines for port State control under MARPOL Annex VI Chapter 3.

The group also discussed Port State control inspections, Fuel oil Non-Availability Reports (FONARS), contingency measures, and EGCS. Further details on the implementation of the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI sulphur limit and Australia’s approach to compliance can be found in:

The group also noted issues that are likely to draw a compliance response from AMSA, including:

  1. repeated reliance on FONARs by ships, operators and/or time charterer
  2. intentionally bunkering a vessel with non‐compliant fuel beyond what is needed to get to the next port when relying on a FONAR
  3. failure to report issues with EGCS until the vessel arrives in a port and
  4. poor maintenance of EGCS resulting in system failures.
  • Where AMSA finds that an operator is intentionally not complying or fails to take effective action, then more robust enforcement options will be considered.
  • While a 95% confidence level applies to indicative fuel oil testing and testing of commercial samples undertaken by the vessel (meaning that a 0.53% test result would be considered compliant), the MARPOL sulphur verification procedure is more stringent and applies a strict 0.50% limit.
  • The IMO principle of no more favourable treatment would apply to vessels that operate under the flag of a non‐Party to MARPOL Annex VI, which aims to create a level playing field and to ensure that every vessel complies.
  • The control provisions in the Navigation Act 2012 allow AMSA to issue directions to ships not to enter Australian ports.

The group also discussed blending of fuel for compliance and whether a fuel that is marginally above the 0.50% limit could be made compliant by mixing with very low sulphur fuel on board in fuel tanks. It was noted that IMO Guidelines provide advice on this and that it is possible to blend fuels on board, but it must be ensured that fuels are compatible.

Amendments to Commonwealth legislation

The Department of Infrastructure, Transport, Regional Development and Communications (DITRDC) provided an update on the amendments to the Protection of the Seas (Prevention of Pollution from Ships) Act 1983 (PoTS Act).

The group noted the Protection of the Sea (Prevention of Pollution from Ships) Amendment (Air Pollution) Bill 2019 and that its purpose is to amend the PoTS Act to implement Australia’s obligations in relation to the 1 January low sulphur fuel requirement and the 1 March carriage ban.

Further information was provided by AMSA on amendments to Marine order 97 to give effect to the PoTS Act amendments from 1 January 2020.

The work of the Mission to Seafarers

The Mission to Seafarers Victoria (MtSV) provided an overview of its work as well as the essential services and support that is offered to seafarers when visiting the port of Melbourne.

The group noted:

  • The significant numbers of seafarers that either use the on shore facilities or are visited on board by the MsTV ship visiting team.
  • MtSV’s funding mechanisms, which include donations and bequests as well as corporate sponsorship/memberships. Interested members were encouraged to contact the Mission for further information on the different levels of corporate sponsorship that are offered.
  • That members are entitled to access to the MtSV’s facilities and social club and that Viva Energy is one of MtSV’s corporate sponsors.

Impacts of exhaust gas cleaning system (EGCS) use on ships on coastal waters

The group was provided with an overview of work undertaken for AMSA by the CSIRO on the impacts of wash water discharges from open‐loop EGCS (also known as scrubbers) on Australia’s coastal waters.

The Group noted:

  • The chemistry associated with the operation of an EGCS and in particular:
    • sulphur oxides (SOx) in the exhaust gas react with seawater to form harmless sulphate
    • acidity created by the scrubbing process is rapidly removed through neutralisation by the natural bicarbonate content of seawater and
    • scrubbing of exhaust gases to remove sulphur circumvents the formation of acid rain that occurs when SOx is released to the atmosphere.
  • In Australia, contaminants in wash water would be regulated according to the Australian and New Zealand Guidelines for Marine and Freshwater Quality. These guidelines apply to receiving waters, not the discharge, so where discharges enter a water body, they should be compliant with the relevant guideline values after an agreed mixing zone.
  • The wash water discharge criteria in the IMO’s Exhaust Gas Cleaning System Guidelines are intended to safeguard against environmental impacts from scrubber wash water discharges.
  • There are also land‐based discharges that contribute to contaminant loads in coastal areas, the most significant of which is road run‐off, which has historically represented one of the major sources of heavy metals to estuaries such as Sydney Harbour. Other land‐based contaminant sources include sewage and stormwater, agricultural run‐off and industrial discharges.
  • EGCS sludge and residues cannot be discharged at sea and must be disposed of at reception facilities on shore.
  • The cumulative effects of discharges from multiple ships should be further examined in ports where tidal flushing is poor.

The group noted that AMSA is currently preparing a scope of work that will assess the cumulative impacts from scrubber discharges over time under various scenarios in selected Australian ports and sensitive environments. It was noted that there are off‐the‐shelf models available for this kind of work, such as the MAMPEC model, which was originally developed for assessing the cumulative impacts from ships’ antifouling coatings and has also been used to assess discharges from ballast water management systems.

EGCS at the IMO

The group noted recent and upcoming work at the IMO on EGCS including:

  • The review of the 2015 Guidelines for exhaust gas cleaning system, which will be further considered at PPR 7.
  • Consideration by MEPC 74 of submissions on EGCS discharge research.
  • The environmental impact of EGCS discharges is currently under close consideration at the IMO due to concerns associated with:
    • the increased use of EGCS by ships to comply with the 1 January 2020 sulphur limit
    • the potential long‐term impacts of cumulative wash water discharges on certain areas with high shipping density that may be vulnerable to increased pH or ineffective removal of other contaminants, such as ports and sensitive environments
    • the unilateral measures that have been put in place in certain areas to prohibit the use of open‐loop EGCS.
  • PPR 7 will commence work on a new output on 'Evaluation and harmonization of rules and guidance on the discharge of liquid effluents from EGCS into waters, including conditions and areas' with a view to address concerns over the potential negative impact on the marine environment and the unilateral local measures that have been put in place in some ports and areas to prohibit the discharge. This work is expected to conclude in 2021 with a report to be submitted to PPR 8.
  • Work being undertaken by the Joint Group of Experts on the Scientific Aspects of Marine Environmental Protection (GESAMP), which will review the available scientific literature, research reports and evidence and oversee a modelling study to assess the environmental impact of EGCS discharges. GESAMP will report on the outcomes of this work to PPR 7.

Australian Government work on low sulphur fuel price impacts

DITRDC provided an overview of the work undertaken by the Australian Government to assess the potential impacts of the Sulphur 2020 regulations on the price of diesel fuel.

The group noted that:

  • The Government has been monitoring fuel prices by examining a variety of information sources (including the maritime media, classification societies, the energy industry (eg International Energy Agency (IEA), Energy Information Administration (EIA), fuel markets), shipping line fuel surcharge announcements, and the ship and bunker price website) and the flow-on effects.
  • Information from the IEA World Oil Report for 2019, which was released in March 2019 and includes a section on IMO 2020. In particular, it was noted that the IEA is anticipating a decrease in demand for road diesel but up to a 20% increase in the price of gas oil in 2020. It was further noted that the IEA considers the impact of Sulphur 2020 will be small, gradual and manageable over time.
  • Information was provided on previous price fluctuations that have occurred in the Singapore Bunker market for comparison (eg ~10‐17.5% decrease in the price of HFO, MG and LSMGO between August 2018 and August 2019) and for road diesel in Australia (eg 36% variation in price between 2008 and 2016).
  • The initial impact of marine fuel price through the economy is looking like being considerably less than originally thought as more information becomes available. The flow-on cost to items on the supermarket shelves would be negligible. It was also noted that Australia is not expected to feel more of the flow-on effects than any other country.
  • It is likely that we are yet to see the full effect and impacts of the new requirements as the market is still very volatile. While it was suggested that the long‐term forecasts on availability look reasonable, there are still several unknowns in the short‐term, but more will be known in January.
July 2019 Roundtable – Session 7

AMSA and MIAL hosted the seventh Sulphur Roundtable in Brisbane on 10 July 2019.

Outcomes of the 6th session of the IMO Sub-Committee on Pollution Prevention and Response Sub-Committee (PPR 6) were discussed, in addition to the 74th session of the Marine Environment Protection Committee (MEPC 74) and the 101st Session of the Maritime Safety Committee (MSC 101).

Other topics included an owner’s perspective on the sulphur limit, AMSA’s compliance and enforcement preparations for 1 January 2020 and the use of tank cleaning additives.

Outcomes from MEPC 74

The group noted that MEPC 74:

  • Adopted the 2019 Guidelines on consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI to support compliance with the sulphur requirement, including guidance on Fuel Oil Non-Availability Reports (FONAR). 
  • Adopted the of 2019 Guidelines for port State control under MARPOL Annex VI Chapter 3 that provides information on the port State control (PSC) procedure for regulation and when non-compliance is claimed.
  • Considered Guidance for port State control on contingency measures for addressing non-compliant fuel oil on how compliance should be managed when a ship has non-compliant fuel oil on board as a result of a non-availability or inadvertently as a result of supply or quality issue. 
  • Approved 2019 Guidelines for on board sampling for the verification of the sulphur content of the fuel oil used on board ships.
  • Noted draft guidance on bunker tank sampling procedures which were referred to the 7th session of the Pollution Prevention and Response Sub-Committee (PPR 7, February 2020) for consideration and completion.
  • Approved a circular on Guidance on indication of ongoing compliance in the case of the failure of a single monitoring instrument, which recommends actions to take if the EGCS fails to meet a provision of the Guidelines.
  • Approved a new output on the Evaluation and harmonisation of rules and guidance on the discharge of liquid effluents from EGCS into waters, including conditions and areas, with work to begin at PPR 7, and finalised in 2021.
  • Established a GESAMP task team to assess available evidence relating to the environmental impact of EGCS washwater discharges.
  • Established a Correspondence Group to consider enhancements to the MARPOL Annex VI module of the Global Integrated Shipping Information System (GISIS) to support reporting and data collection related to the sulphur limit. Australia is participating in this correspondence group.
  • Agreed to further review the 2015 Guidelines for Exhaust Gas Cleaning Systems at PPR 7.
  • Approved a circular on Reporting of data related to fuel oil availability and quality in GISIS to promote greater understanding of the consistent implementation of the 0.50% m/m Sulphur limit under MARPOL Annex VI.

Outcomes from MSC 101

The group noted that MSC 101:

  • Approved the MEPC circular on Guidance for Best practice for Member State/coastal State, related to fuel oil quality; as well as a joint MSC-MEPC circular on delivery of compliant fuel oil by suppliers.
  • Endorsed an action plan to consider measures relating to the flashpoint of fuel oil by the 104th Session of the Maritime Safety Committee in 2021.
  • Established a Correspondence Group to: develop mandatory requirements related to fuel oil suppliers and the provision of poor quality fuel oil; develop mandatory requirements regarding the documentation of the flashpoint of the bunkered fuel oil; and develop guidelines for ships to address situations where they have indicative test results suggesting that the oil fuel quality is poor.

Following the presentation, the following points were made by the group:

  • In some fuel contracts, there are clauses included that require the supplier to provide an alternative compliant fuel at no impost to the customer if the ordered fuel cannot be supplied. 
  • ISO has released a Publicly Available Specification (PAS) for marine fuels and it is expected that the new specification will be available next year.
  • Crew training and on board handling is imperative to avoid blending/compatibility issues.

Australia’s work preparing for sulphur 2020

It was noted by the group that: 

AMSA is looking to investigate the long term impacts of washwater discharges from open-loop exhaust gas cleaning systems into coastal waters, including sensitive environments, to inform international and domestic discussions. This work has been discussed with states/NT and the Great Barrier Reef Marine Park Authority.

Initial advice from CSIRO is that dilutions in the receiving environment of washwater discharges from these systems will adequately reduce all contaminant concentrations to below the receiving water quality guidelines applied in Australia and New Zealand. However, the long-term cumulative impacts of these discharges warrant closer examination. 

AMSA is finalising the updated register of local fuel oil suppliers, which will provide more information on where compliant fuel oils are available, what these compliant fuel oils are and suppliers’ quality management systems where available.

An owner’s perspective on the sulphur limit

Stolt Tanker Trading provided a presentation on the preparations for the 1 January 2020 regulation from an owner’s perspective, which noted that:

  • There are many options to comply with the sulphur limit including MGO; low and ultra-low sulphur heavy fuel oils/blends; LNG; methanol; and other fuels such as biofuels, with advantages and disadvantages with the use of all options. 
  • Ships may not have enough bunker tanks to carry multiple types of fuel.
  • Installing scrubbers on small ships is not viable due to the high installation costs and longer pay-off time.
  • A key consideration when using compliant fuel oil is understanding the specifications of the fuel being bunkered, noting that onboard blending is not an option. 
  • The need to pass these increased costs on to the consumer is being communicated across the industry. Some companies in the liner trade have already begun to recover these costs through the use of a bunker adjustment factor surcharge, but for the charter trade, the price adjustments will generally be written into contracts. 

AMSA’s compliance and enforcement preparations for 1 January 2020

The group noted:

  • Non-compliant fuel oil can be carried on board ships before 1 March 2020, but this fuel oil cannot be burnt from 1 January 2020, unless the ship has an EGCS in operation. AMSA Port State Control Officers (PSCO’s) will be confirming that non-compliant fuel oil carried on-board before 1 March 2020 is not being used.
  • While not mandatory, ships can use a Ship Implementation Plan (SIP) to support their preparations. If a ship has a SIP, AMSA will examine this for actions taken to prepare for the 1 January 2020 limit.
  • Failure to plan will likely result in port State control action where the ship does not comply, noting that a lack of preparations will not be an excuse.
  • AMSA will conduct inspections in line with normal port State control (PSC) practices and will rely on documentation (Bunker Delivery Notes, oil record book etc) and ship board procedures as prima facie evidence of compliance for initial PSC inspections.
  • While AMSA will undertake sampling when there is evidence of non-compliance, it will not be undertaken as a standard practice. However AMSA is looking into the use of indicative testing tools, such as fuel oil handheld analysers to reduce the instances where sampling is required.
  • AMSA confirmed that for ‘in use’ samples (i.e. those taken from the fuel lines) and ‘onboard’ samples (i.e. those taken from the bunker tank), a 95 per cent confidence threshold will be applied to the sulphur limit, meaning that a result of up to 0.53 per cent m/m would be considered compliant; whereas the limit for MARPOL delivered samples (i.e. those taken during the bunkering operations) will have a strict 0.50 per cent limit applied.
  • Ship operators should report non-compliance and malfunctions of EGCS to AMSA as soon as possible, including what is being done to rectify the problem. It is also expected that the ship’s Recognised Organisation (RO) is also informed.
  • Ships with EGCS may be required to burn compliant fuel oil in certain ports and other areas due to restrictions on the discharge of wash water from these systems. 

Tank cleaning additives

A S Harrison & Co Pty Limited provided information on marine fuel additives available to transition and comply with the sulphur limit, noting:

  • Sludge in the tanks could potentially make compliant fuel oil non-compliant if not removed before bunkering. 
  • Manual cleaning, flushing the tank with MGO, or the use of additives can be used to prepare tanks for compliant fuel oil. The use of additives means tanks would not need to be entered, there is no residual contamination of the tanks and less waste sludge needs to be manually removed from the tank and discharged ashore.
  • A tank being treated with the additive would need to be taken offline for 24-48 hours to lift the asphaltenes. The entire tank cleaning could be completed in three cycles.
  • Additives are available to stabilise blends of different fuels and mitigate issues associated with new fuels, such as stability, lubricity, low temperature performance (cold-flow) and biological growth (particularly important in the use of biofuels and keeping water out of the fuel).
  • Carbon monoxide, sulphur oxides, nitrogen oxides and particulate matter emissions can be reduced with the use of additives, more work might be required on the monitoring of aromatics and asphaltenes emissions.
April 2019 Roundtable – Session 6

AMSA and MIAL hosted the sixth Sulphur Roundtable discussion in Adelaide on 10 April 2019.

This roundtable discussed a number of issues, as set out below, as well as relevant outcomes of the 6th session of the Sub-Committee on Pollution Prevention and Response Sub-Committee (PPR 6, February 2019) and issues to be considered at the 74th session of the Marine Environment Protection Committee (MEPC 74, May 2019). In particular, the group noted a number of Australian submissions to be considered at MEPC 74, including:

  • Amendments to the draft 2019 Guidelines for consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI to include how compliance should be managed prior to the carriage ban taking effect from 1 March 2020.
  • The investigation and reporting of a Fuel Oil Non-Availability Report (FONAR) to address identified gaps in compliant fuel oil availability.
  • Contingency measures for managing non-compliant fuel taken on board.

The outcomes of PPR 6 and MEPC 74 can be seen on the IMO website.

Low Sulphur Fuel Confidence Survey

MIAL provided the preliminary findings from their Low Sulphur Fuel Confidence Survey which indicated that:

  • While most survey participants will be looking to use low sulphur fuel oil to comply with the new limit, ~ 16% are expected to use an Exhaust Gas Cleaning System (EGCS) or liquefied natural gas (LNG).
  • Most survey participants were confident that they would have access to compliant fuel oil from 1 January 2020.
  • The participants estimated that compliant fuel oil will cost approximately $247 per tonne more than the current price.

MIAL noted that more information will be available once a full data analysis had been undertaken. They also advised that a follow up survey will be undertaken mid-2019.

Exhaust Gas Cleaning System (EGCS) discharges

  • The group noted that: the IMO were expected to consider whether work should be undertaken to further regulate discharges from EGCS noting the expected increased use of these systems to meet the sulphur 1 January 2020 requirement and the increasing local and/or regional restrictions to control EGCS discharges into the marine environment;
  • AMSA had met with State and Northern Territory (NT) authorities and the Great Barrier Reef Marine Park Authority to discuss the discharge of washwater from EGCS and current regulations.
  • No bans on the discharge of washwater from EGCS have been implemented by the States or NT, however the group recognised that further work is required to understand the long-term impacts from these discharges.
  • AMSA noted that CSIRO are currently looking to model the cumulative impacts from these discharges, which can be used to contribute to discussions domestically and internationally.
  • the availability of reception facilities for EGCS residues at Australian ports was also discussed with States/NT and as it is currently unclear what facilities are available this will require further consideration.

Alternative compliant fuel oils

The Australian Maritime College gave a presentation on the effects of fuel-specific energy and operational demands on cost/emission estimates: A case study on heavy fuel-oil vs LNG. The case study supports the use of LNG as a marine fuel and asserts that more emission reductions can be achieved than previously estimated. 

The group noted that while LNG may be a suitable option for achieving compliance into the future, there are some transitional issues that need to be considered including:

  • The actual reduction of methane slip achievable.
  • The time taken to bunker LNG compared to traditional fuel oils.
  • The risk profile for a spill of LNG, and the bunkering practices needed to address this risk.

Compliant fuel oils

Viva Energy gave a presentation on IMO 2020 Marine Fuel Spec: Australian Commercial and Supply Challenges Update, which noted that:

  • As Australia has a lower demand for high sulphur fuel oil (HSFO) compared to other countries, any non-availability of compliant fuel oil in Australia is expected to be more centred on coastal operators, long haul operators, if required to bunker in Australia, and marine gas oil (MGO) users as a result of expected increases in the price of this fuel.
  • The ongoing demand for HSFO will be from those that install a scrubber, with cruise ships expected to be the biggest users.
  • In ports where high sulphur fuel oil (HSFO) is currently provided, a low sulphur fuel oil (LSF) alternative will also be provided; while in locations where only MGO is currently provided, it is unlikely that an additional or alternative LSF option will be provided.
  • The costs associated with LSF are still very much unknown but it is likely that LSF pricing will continue as a premium to HSFO, rather than a discount to MGO.
  • If an operator wants to use LSF, early discussions with their supplier are necessary to ensure that this demand can be met, as there is a long lead in time and investment required to supply LSF.

The group noted that:

  • Ships under charter will encounter the most difficulties in securing compliant fuel oil.
  • Operators should not rely on de-bunkering of non-compliant fuel oil as part of their preparations to comply with the 1 January 2020 limit, due to limited capacity to de-bunker in Australia.

Impacts on engines from the use of complaint fuel oil

MAN Energy Solutions Australia Pty Ltd provided a presentation on compliance with the 1 January 2020 regulation from an engine maker’s perspective, which noted that:

  • There are choices to comply with the sulphur limit, including the use of EGCS, LSF, MGO, diesel, LNG, methanol, ethanol and LPG.
  • There may be consequences and/or issues associated with these choices, including compatibility issues with fuel oils and increased wear on engine parts, but in most cases solutions are available to address these issues if consultation with the engine manufacturer occurs early.
  • Crew training and familiarity with the solutions to meet compliance will be key.

Compliance with the Sulphur Regulation—ship preparation

TT-Line (Spirit of Tasmania) provided a presentation on the challenges and solutions identified during preparations for the sulphur regulation from a shipping perspective. 

The group noted:

  • The considerations undertaken by TT Line in determining the most appropriate compliance option, which resulted in the use of low sulphur MGO.
  • That the preparations required TT Line to modify the fleet to use MGO, including the fitting of MGO coolers to the fuel oil circulation system and modifications to the fuel injection system.
  • That preparation is the key and in general, the chosen compliance method requires a long lead-in time.

AMSA’s preparations for 1 January 2020

The group noted information on AMSA’s preparations for 1 January 2020, including:

  • That related amendments to Australian legislation are expected to be in place prior to 1 January 2020.
  • AMSA’s approach to port State control (PSC) will not change significantly with the implementation of the new sulphur requirement, noting that if a ship experiences an issue with compliance, this needs to be communicated to the relevant authorities as soon as possible, including any solutions that the ship intends to undertake to rectify the issue.
  • AMSA has been encouraging early preparation for the regulation by providing a letter to all ships calling at Australian ports to ensure that ships are aware of the new sulphur limit and are beginning to prepare.
  • That work is underway to make AMSA’s fuel oil supplier list more robust, including providing more information on the availability of compliant fuel oils and the types of fuel oils available.
January 2019 Roundtable – Session 5

AMSA and MIAL hosted the fifth Sulphur Roundtable discussion in Canberra on 29 January 2019.

This roundtable discussed relevant outcomes of the 73rd Session of the Marine Environment Protection Committee (MEPC 73) and the 100th Session of the Maritime Safety Committee (MSC 100) as well as the remaining work and submissions to be considered at the 6th Session of the Pollution Prevention and Response Sub-Committee (PPR 6) in February 2019.

Other topics covered included: availability of compliant fuel; exhaust gas cleaning systems; the economic impact on the shipping industry in Australia; as well as AMSA’s approach to compliance and enforcement. 

Outcomes from MEPC 73 and MSC 100

The group noted that MEPC 73:

  • Adopted amendments to MARPOL Annex VI to ban the carriage of fuel oil that is not in compliance with the sulphur limits, which will enter into force on 1 March 2020.
  • Approved guidance on the development of a ship implementation plan for the consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI (MEPC.1/Circ.878).
  • Did not agree to introduce an Experience Building Phase to monitor the implementation of the 0.50% sulphur limit.
  • Approved MEPC.1/Circ.875/Add.1 on Guidance on Best Practice for Fuel Oil Suppliers for assuring the quality of fuel oil delivered to ships.

The group noted that MSC 100: 

  • Agreed to a new work output Development of further measures to enhance the safety of ships relating to the use of fuel to be added to the MSC 101 (June 2019) agenda with a completion date of 2021.
  • Noted that industry bodies (OCIMF, IPIECA, IBIA) are developing guidance, which is expected to be available in the second half of 2019 and will address potential safety and operational issues related to the supply and use of low sulphur fuels. 

Pollution Prevention and Response Sub-Committee (PPR) 6 

A summary was provided by AMSA on the issues and submissions to be considered at the 6th Session of the PPR 6 (February 2019) including:

  • Consideration of how to align the sulphur verification procedure in MARPOL Annex VI with the standard ISO procedure that is used by fuel oil testing laboratories.
  • Fuel oil non-availability reporting, including a submission co-sponsored by Australia that provides a format for fuel oil non-availability reports (FONARS).
  • Options for disposing of non-complaint fuel following submission of a FONAR, including de-bunkering and consumption on the high seas.
  • Clarification on application of the non-compliant fuel carriage ban to emergency equipment.

The following points were made by the group:

  • There is a need to understand the availability of compliant fuel oil in ports.
  • Fuel oil non-availability report should not be used for fuel oil compatibility issues.
  • Whilst recognising that diesel fuel oil is likely the main type of compliant fuel to be made available in Australia, the quantity that can be supplied and the infrastructure to support supply (particularly from bunker barges) needed to be further considered.
  • The group was generally supportive of any remaining non-compliant fuel being consumed on the high seas, where a ship has had to bunker non-compliant fuel as a result of non-availability. 

Economic impact on the shipping industry in Australia

Mr Sergey Balytsok of Curtin University provided a presentation on the economic impact of the sulphur cap on the Australia shipping industry, which highlighted the economic benefits of installing an exhaust gas cleaning system, for ships with five or more years operating life.

Also noted:

  • Fleets of vessels of shorter operating life or larger size should consider LNG fuelled new-builds as replacements at the end of their operating life.
  • Industry/Government cooperation is required for the development of LNG bunkering and fuel markets in Australia; however the use of LNG will likely bring a longer term boost to industry and improved environmental outcomes.

The following points were made by the group:

  • That EGCS may not have the longevity once thought with increased concerns with the discharges from open-loop systems into the sea.
  • Fuel contracts are being put in place for the next 5-10 years (primarily with the four major companies in Europe), where an operator needs to estimate the quantity of fuel oil required and is locked in to this supply, even if this amount of fuel oil is not required at the time.
  • Installing an EGCS is not an easy undertaking and impacts on other elements of the ship, including the technical file required for NOx compliance.

Fuel oil availability

The group noted that:

  • AMSA is working to make the fuel oil supplier list  more robust to identify all suppliers of marine fuel oil in Australia and to identify ports which can provide compliant fuel oil.
  • Industry has been trialling chemical tank cleaning procedures en route as an alternative to dry-docking in order to transition to compliant fuel oil from 1 January 2020.
  • Fuel suppliers within the group again advised that compliant fuel oil will be available, but the components of this fuel oil are yet to be determined.
  • Appropriate lubricants will be key, with consideration also needed for those operating in cold climates.

Exhaust Gas Cleaning Systems (EGCS)

The group noted:

  • The work being undertaken at the IMO to support the use of EGCS to comply with the new sulphur regulation.
  • There have not been any bans put in place for the discharge of wash water from open loop EGCS in Australian waters.
  • AMSA will meet with the States/NT/GBRMPA in February 2019 to discuss, among other things, EGCS discharges in ports and coastal waters.
  • The existing module in the IMO’s Global Integrated Shipping Information System (GISIS), whereby countries list information on ships approved to use an EGCS. 

Compliance and enforcement

The group noted that:

  • AMSA‘s approach to port State control (PSC) will not change significantly, with inspections for sulphur compliance incorporated into the existing PSC regime.
  • AMSA’s port State control officers will be distributing an advisory letter to ships from 1 February 2019 that provides general information on how compliance will be checked.
  • Ships are expected to report instances of non-compliance to their flag State, Recognised Organisation (RO) and the port State at the next port.
  • Any issues with compliance need to be communicated to these relevant authorities as soon as possible, including any solutions that the ship intends to undertake to rectify the issue.
  • AMSA is investigating indicative tools and sampling as part of the compliance framework.
September 2018 Roundtable – Session 4

On 25 September 2018 AMSA and MIAL presented the fourth joint Roundtable discussion on the sulphur regulation, hosted by Viva Energy at their facilities in Gore Bay, Sydney.  

AMSA provided an update on recent IMO meetings on the implementation of the regulation, including an intersessional sulphur working group meeting (July 2018) which developed guidance for a non-mandatory Ship Implementation Plan that can aid ships in planning for the transition to the regulation. The meeting also considered safety issues associated with the use of low sulphur fuels, which will be considered by the IMO’s Maritime Safety Committee in December 2018, including compatibility, stability of blended fuels, cold-flow properties and catalytic fines. 

It was noted that OCIMF & IPIECA with ISO, CIMAC and the Energy Institute, are developing industry guidance that addresses the impact of new fuel blends or fuel types on machinery systems, as well as guidance on handling, storing and using these fuels. This industry guidance should be made available to the 6th session of the IMO Pollution Prevention and Response Sub-Committee (PPR 6 – February 2019).

In relation to categorisation of new fuels, MIAL and AMSA noted that ISO has advised that 0.50% fuel oils will be categorised within the existing ISO 8217 Standard. ISO is currently updating the standard accordingly, however, as this will not be ready until late 2020, ISO will release a Publically Available Specification (PAS) in 2019 which will provide guidance on the application of ISO 8217 to low sulphur fuels. 
It was noted that several key issues would be considered at the October meeting of the IMO Marine Environment Protection Committee (MEPC 73):

  • For adoption – a ban on the use and carriage for use of non-compliant fuel, to support compliance with the 0.50% m/m sulphur standard (Note: This was adopted at MEPC 73 and will enter into force 1 March 2020) 
  • An ‘experience building phase’ including voluntary data collection and a focus on addressing issues with compliance without penalisation (Note: This did not gain support at MEPC 73) 
  • Encouraging reporting on the availability of compliant fuels through IMO’s Global Integrated Shipping Information System (GISIS) prior to 1 January 2020 through an MEPC resolution (Note: This was supported but will be promulgated through an IMO Circular rather than a resolution)

The group discussed the fuel options to achieve compliance with the regulation, including the use of Marine Gas Oil; 3.50% sulphur fuel (HSFO) when the ship has in use an exhaust gas cleaning system (i.e. scrubber); and 0.50% m/m blended fuels, noting that supplies of the latter can be secured under contractual arrangements with the supplier. 

The group discussed the compliance approach in Australia and elsewhere from 1 January 2020. AMSA noted that the existing port State control inspection regime for determining compliance will continue to operate post 1 January 2020. AMSA is currently assessing the potential use of indicative tools to detect non-compliance, such as sniffer tools and hand held analysers. It was noted that exhaust gas cleaning systems (as an equivalent to the use of low sulphur fuel to comply with the regulation) will be permitted under the MARPOL Convention and Commonwealth legislation, however, there may be restrictions on the discharge of waste water from the system to comply with State/NT water quality regulations. 

In recognising the uncertainty associated with compatibility of engines and compliant fuel, members of the group provided information on their transitional plans for 1 January 2020. This included trialling compliant fuels in engine systems to identify any issues that need to be rectified, particularly associated with compatibility; consideration and cost comparisons for the installation of scrubbers; and communications with clients related to expected increases in costs with the global implementation of the regulation.  

In relation to the availability of compliant fuels, the benefits of enhancing the fuel oil suppliers list maintained by AMSA was also discussed. It was suggested that enhancing this list could support the identification of where in Australia compliant fuel is available and, potentially, ports where poor quality fuel has been delivered, which could be made public through the IMO Global Integrated Information System (GISIS) or the fuel oil suppliers list. It was also noted that it is a requirement to be listed on AMSA’s fuel oil supplier list if providing marine fuel. If you are currently providing fuel to the maritime industry, but are not registered, please contact

The group also discussed that it would be beneficial for there to be a publically available list of ships that have an approved scrubber installed so that fuel oil suppliers can check this against requests for non-compliant fuels in an effort to assist with compliance. This is something that AMSA will investigate further. 

The group noted the work to be undertaken by AMSA to gather information to assess the case, or otherwise, for an IMO designated Emission Control Area (ECA), to inform future decision making on air emissions in Australian waters. AMSA noted this was for research purposes only. 

It was suggested that the next Sulphur roundtable take place in late January, ahead of the meeting of the next IMO Pollution Prevention and Response Sub-Committee meeting in February (PPR 6).

June 2018 Roundtable – Session 3

AMSA and MIAL hosted the third Joint Roundtable discussion on the implementation of the sulphur regulation on 14 June 2018.

This roundtable met to consider the draft content for a single set of Guidelines to support the implementation of the sulphur regulation.

AMSA provided information on the draft Guidelines, including:

  • The development of ship implementation plans.
  • Consideration of the impact of low sulphur blended fuels on fuel and machinery systems.
  • Proposed text to address verification issues and control mechanisms and actions, primarily directed at port State control activities.
  • Proposals to prohibit the supply of non-compliant fuel to ships that are not using an exhaust gas cleaning system (i.e. a scrubber).
  • Non-compliance reporting and sharing information on fuel oil non availability reports and subsequent investigations on the IMO Global Integrated Shipping Information System GISIS.
  • Consequential amendments to the regulations within MARPOL Annex VI.

Key outcomes from the general discussion included the following considerations:

  • Broad stakeholder consultation and involvement should be further encouraged.
  • A national approach for the use of open and closed loop exhaust gas cleaning systems (scrubbers) to inform investment decisions and give certainty to industry.
  • Acknowledgement of impacts on supply and price of automotive grade diesel.
  • Recognition that the accurate costs and impacts of implementation on stakeholders are still largely unknown at this time.

Key outcomes from the discussion on the draft Guidelines:

  • General agreement that the use of ships implementation plans would aid transition, but higher port State control scrutiny in the absence of a plan was not supported.
  • Suggestion that the use of renewable diesel as a compliant fuel should also be referenced in the draft Guidelines.
  • Support for prohibiting the supply of non-compliant fuel unless the ship has a scrubber in use as long as the proposal is applied consistently both in Australian and internationally.

Suggestion that research and development incentives could be made available in Australia to encourage the development and use of new fuels to support the regulation.

May 2018 Roundtable – Session 2

AMSA and MIAL hosted the second Joint Roundtable discussion on 15 May 2018.

Key considerations discussed by the group included:

  • The provision of quality and compliant fuel oil outside of Australia.
  • The cost of compliant fuel.
  • Concerns with issues that may occur with the combustion of blended fuels.
  • The use of proposed ship implementation plans to assist with transition and compliance.
  • The use of exhaust gas cleaning systems (scrubbers) to meet the sulphur regulation.

The group was informed about the IMO progress since the first roundtable, including aspects to be included in the single set of Guidelines to be developed.

September 2017 Roundtable – Session 1

On Wednesday 20 September 2017, Maritime Industry Australia (MIAL) and AMSA hosted the first joint roundtable discussion on the implementation of the sulphur regulation.

The group identified issues associated with implementation of the sulphur regulation, and solutions, and discussed the different roles and responsibilities of all stakeholders in this implementation.

Some key issues that were discussed included compliance (e.g. ensuring a level playing field for all shippers through measures that do not promote non-compliance); and industry considerations (e.g. how ships will meet the new regulation).

Based on these discussions, an Australian paper was submitted to the IMO subcommittee (Pollution Prevention and Response Sub-Committee) in February 2018 on:

  • Not creating unintended and undesirable incentives contrary to the intent of the regulation, which can create disadvantages within the industry.
  • The need for consistent evidence to be submitted with a fuel oil non-availability report.
  • The importance of investigating fuel oil non-availability reports.
  • The need to clarify the responsibilities of suppliers when non-compliant fuel is requested.
  • Support for increased efforts for countries not a party to MARPOL Annex VI, to ratify this Annex.

A brief history


The IMO adopted amendments to Annex VI of MARPOL, setting progressively more stringent regulations to control emissions from ships, including for sulphur oxides (SOx). As part of these amendments, the IMO agreed that from 1 January 2020, the sulphur content in fuel oil used by ships must be less than 0.5 per cent m/m, subject to a review of the global availability of low sulphur fuel.


The required review was commissioned by the IMO and assessed the global and regional demand for, and supply of, compliant fuel oil, drawing on industry and stakeholder input. The review was completed in 2016 and found that sufficient compliant fuel oil would be available to meet the 2020 date.

IMO members agreed to retain the 1 January 2020 implementation date for the 0.5 per cent m/m sulphur content limit in fuel oil. This is a reduction from the current limit of 3.5 per cent m/m, which has been in effect since 1 January 2012.

This new limit aims to reduce the impacts of sulphur oxide emissions on the environment and human health, particularly for people living in port cities and coastal communities.

Last updated: 14 November 2023