Danish shipping company TORM is turning to scrubbers in an effort to prepare for the upcoming 2020 sulfur cap.
Namely, the company said that it has “decided to install scrubbers on 14 of our vessels to prepare for the expected consequences of the IMO sulfur emission directive.”
The vessels in question include all units currently on order and the three LR2 vessels that were delivered earlier in 2018. These vessels have a scrubber-prepared design and there are no changes to the delivery schedule.
As of today, TORM’s scrubber program covers four LR2s, two LR1s and eight MRs.
The company unveiled the plans as part of its second quarter 2018 financial report. EBITDA for the period was USD 29.4 million, compared to USD 35.7 million reported in the same quarter a year earlier. The loss before tax amounted to USD 8.6 million, against a loss of USD 1.5 million seen in the second quarter of 2017.
“Despite healthy end-user consumption, the product tanker market remained under pressure in the second quarter of 2018. Nevertheless, I am pleased to see TORM outperformed commercially when comparing to relevant benchmarks and peers,” Jacob Meldgaard, Executive Director, said.
“We have continued to take steps to further renew and optimize our fleet by taking delivery of one LR2 newbuilding in the second quarter and exercising newbuilding options for three MR vessels.
In the second quarter of 2018, TORM achieved TCE rates of USD 12,944 per day, down from USD 13,841 per day reported a year earlier. In the second quarter of 2018, product tanker freight rates started out at levels close to the levels seen in the first quarter of 2018, but the rates started to slide towards the end of the quarter.
As of 30 June 2018, 15% of the remaining total earning days in 2018 were covered at an average rate of USD 16,323 per day.