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IMO chief urges shipping industry collaboration on emissions reduction

London — International Maritime Organization Secretary-General Kitack Lim Monday opened a weeklong meeting at the UN body's London headquarters with a call for the shipping industry to collaborate on its preparations for tougher sulfur restrictions next year.

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This week's meeting of the IMO's Marine Environment Protection Committee is the last one before the global sulfur emission limit drops from 3.5% to 0.5% at the start of next year. The MEPC was the IMO body that took the final decision in October 2016 on the 2020 start date for the new limit.

"Significant efforts have been made by this organization to help the shipping industry to prepare," Lim said. "I cannot stress strongly enough how significant this decision was for the environment and human health." Lim acknowledged it was "not easy" for shipping to adjust to the new limit.

"It's a very, very difficult task," he said.

On Friday S&P Global Platts assessed the Rotterdam 0.5% sulfur fuel barge price at a premium of $58.75/mt to high sulfur fuel oil -- a rough approximation of the rise in fuel bills the shipping industry faces next year. This spread is expected to widen further over the remainder of 2019 as fuel oil demand drops and the industry starts switching to the new 0.5% sulfur fuel blends.

The global shipping industry consumes around 300 million mt a year of marine fuels.

This week the MEPC will discuss measures for the effective implementation of the sulfur cap next year. The body will examine how port states can verify non-compliant fuels, as well as what they can do to prevent them being sold.

A delegation from the International Organization for Standardization is expected to provide some information on its new guidance on 0.5% sulfur marine fuel specifications, due to be published next year.

This week's MEPC meeting is also due to discuss short-term measures on greenhouse gas emissions reduction. As delegates arrived at the IMO headquarters they were greeted by protesters from the Extinction Rebellion group calling for mandatory slow steaming and other steps to reduce the shipping industry's carbon footprint more sharply.

The IMO's initial strategy on GHGs requires a 50% drop in the shipping industry's GHG emissions from 2008 levels by 2050. The organization has yet to adopt short-term measures to start this process, and mandatory slow steaming to maximize fuel efficiency is one proposal being considered this week.

"It is imperative that this organization demonstrates that it will continue to take tangible action to reduce GHG emissions from shipping in the short term," Lim said at the opening of the meeting.

"The global community needs to bring action, not words."

--Jack Jordan, jack.jordan@spglobal.com

--Edited by Jonathan Dart, newsdesk@spglobal.com