Timing is everything in BWMS talks

A proposal co-sponsored by Brazil, Cook Islands, India, Norway, Liberia and the UK) to change the installation deadline for the Ballast Water Management Convention, due to enter force on 8 September. The proposal would change the deadline for ships to install systems from the date of their first International Oil Pollution and Prevention (IOPP) survey after the convention’s entry into force to the first IOPP survey after 8 September 2019 – effectively adding two years to the global installation process, which would then be completed by 2024 rather than 2022.

The extension is intended to allow for new systems, approved under the updated G8 guidelines on testing and type approval, to come to market. Supporting the move, the International Chamber of Shipping insists there is no logic, from an environmental protection standpoint, in requiring thousands of ships in the existing fleet to comply until they can be fitted with systems that have been approved under the more stringent type-approval standards which were only adopted by IMO in 2016.

Declaring the chamber’s support and that of its affiliated national shipowner associations, Peter Hinchcliffe, secretary general, ICS, said: “It is vital that IMO makes a definite decision about the implementation schedule at its meeting in July so that shipping companies have absolute clarity and can take sensible decisions about when to install these high-cost systems in the best interests of the environment.”

Operational issues

That view is borne out by the support of ship operators. One such, Wallem Shipmanagement, has already outlined the operational challenges facing crews as they begin to use BWMS. Group technical director Ioannis Stefanou acknowledges that the lack of operational systems to date means that neither manufacturers nor ship operators have accumulated significant experience on the real-life performance of systems.

For its part, a very large portion of Wallem Shipmanagement’s fleet does not yet have a BWMS installed. Stefanou notes: “The time will come when these vessels will be retrofitted with a BWTS or head to the scrap yard depending on what each owner has decided it makes the best financial sense for them.”

Stefanou is sanguine about the perceived slow uptake of BWMS by owners. “Sometimes the right action is inaction,” he says. Given the uncertainties that have dogged the regulatory framework and the still very limited availability of USCG-approved systems on the other hand, he argues that it is normal to expect owners to be cautious embarking on such a high capital commitment.

Given those challenges, it is not surprising that Stefanou too supports a postponement to the installation timeframe “I think that this definitely a move in the right direction,” he says. “It will give some breathing space to the owners, the yards and to the system manufacturers. However, this will only have a positive impact on the owners whose ships don’t trade in the US.”

The proposal to extend installation timescales must be considered in conjunction with the decision – also due to be debated at MEPC – about whether to allow decoupling of the International Oil Pollution and Prevention (IOPP) certificate. This strategy has so far enabled owners under some flags to take IOPP surveys early, buying more time until their next survey after the convention is into force (and therefore until their installation deadlines).

Addressing IOPP

Susanna Wyllie, global proposals manager for De Nora’s Balpure BWMS, says: “With deharmonisation in place but no deadline extension, or a deadline extended by two years but the IOPP harmonised, we can still expect to be looking at the two-to-five year timescales the industry is currently discussing. However, if both a two-year extension and the decoupling of the IOPP certificate are permitted, the industry will essentially be kicking the can five-to-seven years down the road.”

Balpure has so far been installed on 43 newbuilds and selected for the retrofit of 12 vessels, the bulk of which are LNG carriers and tankers (including suezmax, VLCC and MR tankers). Wyllie confirms that a number of these systems have been commissioned and are operating regularly. Although the company has a strong water treatment and electrode business independent of BWMS, it has invested heavily to develop the Balpure system and will soon be opening new facilities dedicated to production. Wyllie’s frustration over the prospect of a further delay is clear.

“The industry has already had 13 years to plan and put in place sufficient capabilities to meet compliance,” she says. “Over 50 ballast water treatment systems have IMO type approval. Several systems already have USCG approval with many more, including Balpure, going through the approval process and certified as USCG alternate management systems [AMS].

“The testing of these systems is not purely academic, Balpure has been rigorously tested in commercial use and there are systems actively operating across the world. The industry is well prepared to meet the entry into force deadline with full compliance if it is required to do so. The requirement for compliance has not come out of the blue, and if after nearly 15 years owners are not yet prepared to meet it, what will an additional two years achieve?”

De Nora is by no means alone in this frustration. Andrew Marshall, CEO of Coldharbour Marine, believes that many suppliers are hanging on by a thread. Any delay will inevitably see a reduction in the number of companies able to supply BWMS when the time comes.

Hanging on

“The mad rush to the tills that some expected this year has not emerged, possibly because there has been so much IOPP decoupling already,” says Marshall. “Investors are happy to put their hands in their pockets as long as they know how much they need to pay. The longer the delay, the more companies are likely to fall out of the sector. I’m not just talking about bankruptcies – I also think you will see people who have developed the technology just walking away to focus on something else until the industry can get its act together.”

That, Marshall believes, could leave ship owners facing Hobson’s Choice – having to take whichever systems are still being made available, even if they are less than ideally suited or overpriced.

Having said that, a two-year delay in installation timeframes may not be a bad thing for Coldharbour Marine’s own BWMS business. The company is facing its own delay after struggling to find an appropriate lab for USCG testing of its system, which relies on inert gas diffusion in ballast tanks to treat water to the required standard. As a result, it is now targeting US type approval by the end of 2018, although in the meantime it too holds AMS status. Given that situation, a two-year delay in the ordering peak is not necessarily a bad thing for Coldharbour.

The responses to a potential extension or postponement in the installation timeframe – owners for, suppliers against – will surprise few. Not for the first time in the BWM Convention process, the most important thing the IMO can provide, whichever way the decision falls, is clarity.