Organised under the patronage of H.H. Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai as a part of the UAE’s Maritime Week
22, September, Dubai – UAE, Law regarding the Maritime and Oil Industry in the Middle East will soon see some major changes that could fundamentally change how the sector operates. Erik Jensby, the Head of Business Development at BIMCO will be discussing such issues at the upcoming Dubai Marine Insurance Conference (DMIC) on September 24 at the QE2.
“I am delighted to take part in this Conference and present BIMCO’s clauses and view on the upcoming 2020 Sulphur Cap and complications”, said Erik Jensby, the Head of Business Development at BIMCO.
Considering that regulations such as these will undoubtedly affect the entire Maritimes and Oil Sector, these conferences will allow the maritime sector to come together to develop potential plans and solution for these issues.
The 2ndedition of Dubai Marine Insurance Conference focusing on offshore energy is held under the patronage of H.H. Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, as an integral part of the UAE’s Maritime Week on the 24thof September, 2019 at the monumental QE2 docked permanently at Dubai’s Mina Rashid.
Starting in January 2020, the International Maritime Organization (IMO) will begin implementing Regulation 14.1.3 of Annex VI of the MARPOL Convention. This was first adopted by the IMO in 2016 in an effort to reduce potential environmental concerns after significant cases of vessel bunker contamination in the US Gulf and Singapore. A study cited by the IMO states that over 570,000 premature deaths could be reduced through these new regulations, giving a high incentive for their creation.
The new regulation centrally states that the sulphur content of any fuel oil used onboard ships cannot exceed 0.50% m/m on and after 1 January 2020. This is significantly lower than the previous 3.5% m/m limit under regulation 14.1.2. This will be followed by all port and coastal states that have ratified Annex VI including the UAE.
Potential Disputes that can stem from these changes in the regulation include the installation and maintenance of scrubbers, devices that can clean sulphur and reduce emissions. It would also require a larger number of Bunker suppliers in order to do more fuel blending to meet new sulphur regulation. For charter parties unprepared and not drafted with the 2020 laws in mind, this could lead to a greater amount of funds being spent in order to comply with the new laws.
The risk of non-compliance with the new regulations could have led to questions of what kind of charters could be affected as well as what kind of punishments could be implemented to breaking the regulation. Potentially, offences could lead to claims of charterers being unseaworthy due to vessels to more taxing punishments including financial or payment penalties.
It also raises the issue of how oil depending states and major companies will respond to this regulation including the UAE. Environmental concerns have also been raised. A significant concern as mixing different 0.5 Sulphur fuels could potentially harm the ships while they are at sea. The reliance on scrubbers is also an issue as some believe that they are harmful to the environment due to the wastewater they dump into the sea.
The inaugural edition of Dubai Marine Insurance Conference (DMIC) was launched in November 2018 hosted by the Dubai Maritime City Authority and supported by the Emirates Maritime Arbitration Centre. Bringing together 52 speakers and 440 attendees from various sectors of the maritime industry where the industry experts discussed key issues affecting marine insurance procedures and the state of the worldwide marine insurance market.
The first of its kind platform in the Middle East, to gather maritime experts and marine insurance professionals to discuss, understand and maximize the outcomes of the current trends as well as the potential future state of the industry.
With the theme ‘Manage Your Risk’ the second edition of DMIC’s sessions and panel discussions will be elaborating on risk management in addition to sharing new researches and exploring potential solutions to tackle some of the most critical issues facing the oil & gas industry in the Middle East such as prices volatility, environmental issues, changing market regulations, development of new usages, emerging processes and insurance policy.
Affirming confidence in the value of this conference, Mr.Majid Obaid bin Bashir, Chairman and Secretary-General, Emirates Maritime Arbitration Centre (EMAC), said: “EMAC will continue to show support for the maritime and offshore energy sectors by participating at key industry events like DMIC. Especially that this year’s agenda highlights the risks impeding the maritime industry and we look forward to contemplating on how organizations can work together to support the energy and maritime economies”.
“EMAC is delighted to participate in the 2ndMaritime Insurance Conference in Dubai, whereby we not only actively participate, but we learn more about the insurance concerns of stakeholders within maritime, offshore energy and logistics in the Middle East region. There is a definite benefit to bringing the community together for these types of focused events and we applaud Maritime Sky for once again hosting this unique gathering in Dubai”, Bin Bashir added.