Tanker phase out could bring spate of ordersNews // October 20, 2000
Although not yet set in stone, the MEPC's thinking seems to be that pre-MARPOL tankers will be gradually phased out between January 2003 and January 2007, depending on exactly when they were delivered.
The situation for post-MARPOL tankers is a little more complicated in as much as those built before 1986 will be phased out once they reach 25 years of age, whilst those built after 1986 will be phased out between 2012 and 2015, or between 2012 and 2017.Tankers of less than 20,000dwt and single hull product tankers of less than 30,000dwt will be phased out by 2017.
This at, least, is the IMO's thinking, but what actually happens, and when, could still largely depend on whether the EU continues to press for earlier phase-outs. Basically, the MEPC scheme would give owners pre-MARPOL tankers two years longer to replace their ships than currently envisaged under 'EurOPA', as the EU scheme has become known. Owners of post-MARPOL tonnage would be much better off under the MEPC regime, as currently drafted.
Whenever pre-MAPROL and post-MARPOL ships are finally phased out, the world's shipyards will stand to benefit from a huge influx of orders. Moreover, if as has recently been suggested, legislation is eventually introduced to enforce double hulls on larger ships of all types - in order to protect their bunkers - the effects could be truly astounding, both for shipbuilders, and shipbreakers. Currently, however, few berths are available for the construction of tankers much before the middle of 2003, thus complicating the capacity versus demand equation.
Although shipowners will have to bear the cost of the phase-out, it could suit some owners very nicely - Floating Production, Storage & Offloading (FPSO) platforms have become the platform of choice for the exploitation of deepwater oilfields, and demandfor hulls for conversion to FPSOs is rising.
In September, Concordia Maritime sold two of its elderly tankers, the Stena Concordia and the Stena Continent, to Brown & Root for conversion to FPSOs, and achieved what shipbrokers Clarksons describe as 'unbelievable prices' - $16 million for the 1973-built 276,616dwt Stena Concordia, and $17 million for the 1975-built 273,187dwt Stena Continent.