SINGAPORE - France-based box ship giant CMA CGM, which took over Singapore's Neptune Orient Lines (NOL), estimates it would incur about US$1.5 billion (S$2.06 billion) to comply with a green shipping regulation that will cap sulphur content in marine fuels.
This is based on an extrapolation of CMA CGM's share of some US$15 billion in estimated exposure, one industry publication said. The container shipping segment may sustain from the implementation of the International Maritime Organisation's (IMO's) 2020 global sulphur cap, APL's chief executive, Nicolas Sartini, said at SIBCON 2018 (Singapore International Bunkering Conference and Exhibition) on Wednesday (Oct 3).
CMA CGM acquired APL in 2016 when it bought out NOL. The combined group holds about 10 per cent market share in the container shipping sector.
The IMO global sulphur cap that restricts sulphur content in marine fuels to 0.5 per cent, will take effect by 2020.
Citing a Wood Mackenzie estimate, Mr Sartini said the IMO 2020 global sulphur cap would cost the larger international shipping sector - which includes both cargo and passenger carrying vessels - US$60 billion.
Mr Sartini named several steps the larger CMA CGM group intends to take to comply with the cap.
The French giant has already commissioned the construction of nine new-building liquefied natural gas (LNG)-fuelled box ships, the singular biggest investment made by a container shipping company so far in ships to be powered by the cleaner burning fossil fuel.
It also plans to use sulphur cap-compliant fuel oils where they can be possibly procured and install scrubbers on board ships that may have to run on high sulphur heavy fuel oil.
Scrubbers are equipment used to remove sulphur and other pollutants from exhaust gas emitted by ship engines.