MEPC 59th Session (13 17 July 2009)

International Regulation News Update

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Marine Environment Protection Committees 59th Session (13 17 July 2009)

Regulatory Development GHG INITIATIVES (pages 1 - 2)

Preparing for the Diplomatic Conference Market Based Instruments for GHG Energy Efficiency of Ships

Ship Application All Ships

MARPOL ANNEX I AMENDMENTS (pages 2- 3)

New USA/Canada ECA Ship-to-Ship Transfer of Cargo Oil Oil Residue Treatment All Ships Oil Tankers All Ships

MISCELLANEOUS (pages 3-4)

Cargo Hold Washings Bilge Water Treatment VOC Emissions All Ships All Ships Oil Tankers All Ships

BALLAST WATER MANAGEMENT (pages 4- 6)

BWM Convention Compliance Basic Approvals Granted Final Approval Granted

( All Ships includes all marine craft including barges, drill rigs, submersibles, and floating platforms)

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MEPC 59th Session (13 17 July 2009)

The 59 session of the Marine Environment Protection Committee met in London from 13 17 July 2009. Although the highest profile matter addressed by the MEPC concerned Green House Gas (GHG) reductions for the maritime transport sector, other regulation was developed as summarized below. GHG INITIATIVES Preparing for the Diplomatic Conference Discussions on Green House Gas Reductions continued as IMO prepares for the December 2009 Climate Change Conference (COP 15) in Copenhagen, Denmark, where, pursuant to the December 2007 Bali Conference, Governments will meet to negotiate a new legally binding treaty to combat global warming. Failure to do so would place into question IMOs ability to adequately regulate emissions from shipping to the degree desired by the United Nations. Developing countries continued to be reluctant to agree on proposals during MEPC 59 that might compromise negotiations at the December 2009 Conference in Copenhagen. This reluctance was due primarily to differences in opinion on how a balance is to be achieved between the following two principles: Kyoto Protocols principle of common but differentiated responsibilities (ensuring that any funds accrued from a market based instrument are allocated to those areas where a net benefit is achieved by nonAnnex I parties); versus IMOs principle of no more favourable treatment of ships thus providing for a system that is global and does not unduly penalize vessels based upon their trading routes or flag. Notwithstanding the above and in light of studies which estimate that, through technical and operational measures, shipping could reduce CO2 emissions per ton-mile by 50% for ships delivered in 2030 and by up to 70% for ships delivered in 2050, initial discussions focused on three GHG reduction proposals for a Market Based Instrument as described below. Market Based Instruments for GHG Three GHG reduction proposals for a market based instrument were discussed in principle with the following issues laying the background:

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the need to avoiding the creation of an imbalance or modal shift in transport to the detriment of the environment overall shore-based industry efforts to reduce GHG recognition by industry that applying todays technology to the current fleet of 55,000 ships > 400 gt and the adoption of energy saving best practices in the construction of new ships has the potential to contribute a 15% reduction in CO2 emissions by 2030 Emission Trading - Cap and Trade Proposal This scheme would establish an emission cap for a certain period based on total emissions generated from the maritime sector. Ships would need to surrender allowances for the emissions they create and, if necessary, acquire allowances and credits from within the maritime sector or from other sectors (i.e., an open system as opposed to a closed system which would be limited to trading within the maritime sector only). The total amount of allowances issued for shipping would establish the cap. An international body, e.g., IMO, would be tasked to administer the scheme (distribute allowances, manage allowance registries for ships and monitor compliance). The cap could be periodically adjusted to suit environmental needs for the shipping sector. This proposal did not conclude on how credits would be allocated; either by free allocation (based on former emissions of individual ships) or by auctioning (participants purchase allowances based on their forecast demand during the trading period). Bunker Use Levy Proposal This scheme, which builds on the provisions of existing requirements in MARPOL Annex VI and on the existing International Oil Pollution Compensation Funds mechanism, is considered by some to be the simplest of the three proposals. It would require ships to purchase fuel at a registered bunker fuel supplier who would provide documentation, in the form of a bunker delivery note, that bunker fuel had been purchased and that the GHG contributions were paid. A central administrator (through the International GHG Fund) would maintain a global registry of registered bunker fuel suppliers, GHG contributions received, and separate accounts for each ship. Ships flying the flag of a non-Party would also be required to participate in the scheme in advance of calling at a port located within the jurisdiction of a Party.

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MEPC 59th Session (13 17 July 2009)

Emission Trading - EEDI Proposal This scheme establishes mandatory efficiency standards for new and existing ships. The Energy Efficiency Design Index, EEDI, would provide a means to measure and improve on the efficiency of all ships and allow ships to trade efficiency credits to comply with the efficiency standard. Account of ship type/class and size of ship would mitigate problems encountered to date where certain vessel types/classes face unique emission circumstances while also avoiding inappropriate comparisons of large transoceanic vessels with smaller coastal feeders. Signatory States would establish a specific reduction in the average efficiency of the worlds fleet as compared to the current average. Individual ships would then be judged against the improved efficiency as compared to the average efficiency for the relevant range of ship type/class and size. While this approach does not place a cap on emissions in the shipping sector, it does provide for definitive performance standards. Energy Efficiency of Ships Four voluntary guidelines addressing the energy efficiency of ships were accepted on an interim basis and will be subject to further refinement at MEPC 60 in March 2010. 1. MEPC.1/Circ.681 contains interim guidelines on the method of calculation of the Energy Efficiency Design Index (EEDI) for new ships. The ships EEDI is derived from emission factors associated with the fuel consumed by the main engine emissions, nominal auxiliary engine power, and auxiliary generator power. The EEDI for all of these derivations is adjusted by a factor which accounts for any innovative energy efficient technologies used onboard. 2. MEPC.1/Circ.682 contains guidelines for voluntary verification of the EEDI. It recommends preliminary verification at the design stage (based on reliable tank test results) and a final verification after construction. This is to occur during seatrials in the fully loaded condition - to the extent that this is possible and at a measured ship speed corresponding to 75% of the maximum continuous rated power. The results of the verification are to be compiled in an EEDI Technical File.

3. MEPC.1/Circ.683 contains guidelines for the development of a ship energy efficiency management plan (SEEMP). This plan establishes a mechanism to implement environmental management, energy monitoring and efficiency-improvement for the ships operation. This management tool is aimed at assisting a company in managing the ongoing environmental performance of their ships through four basic steps: planning, implementation, monitoring, and self-evaluation and improvement. 4. MEPC.1/Circ.684 contains guidelines for voluntary use of the Energy Efficiency Operational Indicator, EEOI, in a manner that is a representative of the energy efficiency of the ship. It is applied to the operation over a period that represents the overall trading pattern of the ship. The guide provides an example of a calculation method that is used as an objective, performance-based, approach to monitoring the efficiency of a ships operation. In so doing, it establishes a consistent approach to assist in the evaluation of the performance of a ship with regard to CO2 emissions in terms of the mass of CO2 emitted per unit of transported cargo. MARPOL ANNEX I AMENDMENTS New USA/Canada ECA A proposed new 200nmi USA/Canada Emission Control Area (ECA), see Figure 1, was approved in principle by the Committee. If adopted at MEPC 60 in March 2010, it is expected to enter into force in August 2012.

Figure 1 - USA/Canada ECA

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MEPC 59th Session (13 17 July 2009)

In accordance with the revised MARPOL Annex VI, which enters into force on 1 July 2010, ships transiting within ECAs will be required to use fuel oil where the sulphur content does not exceed 1% m/m on 1 January 2010 which reduces to 0.1% m/m on 1 January 2015. Alternatively, ships burning fuels having sulphur contents greater than that indicated above may achieve compliance in accordance with the equivalency provisions of MARPOL VI/4. In such cases, the exhaust gas is cleaned with an approved Exhaust Gas Cleaning System. In this regard, the Committee adopted resolution MEPC.184(59) which contains revised guidelines for testing, survey, certification and verification of exhaust gas cleaning systems, including washwater discharge criteria. In addition to the low sulphur provisions for ECAs, engines installed on ships constructed on/after 1 January 2016 which operate within an ECA will need to meet the NOx Code Tier III emission standard. Ship-to-Ship Transfer of Cargo Oil The Committee adopted resolution MEPC.186(59) which contains a new Chapter 8 to MARPOL Annex I on the prevention of pollution during the transfer of oil cargo between oil tankers at sea. The new regulation applies to any oil tanker of 150 gt and above engaged in the transfer of oil cargo between oil tankers at sea (STS operations). Bunker operations and oil transfer operations associated with fixed or floating platforms are excluded. Affected oil tankers involved in STS operations will need to carry on board an approved STS Plan describing how STS operations are to be conducted. STS plan approval is required not later than the date of the first annual, intermediate or renewal survey of the ship under MARPOL Annex I to be carried out on or after 1 January 2011. Operations conducted on or after 1 April 2012 must be in accordance with the approved plan. Records of STS operations shall be recorded in the Oil Record Book and are to be retained on board for a period of not less than three years since the transfer occurred. Any oil tanker subject to the regulation that plans STS operations within the territorial sea or the Exclusive Economic Zone of a Party to MARPOL, shall notify the relevant coastal state
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Party not less than 48 hours in advance of the scheduled STS operations. The notification shall include at least the following: ship's name, flag, call sign, IMO number, estimated time of arrival of the oil tankers involved in the STS operations, date, time, location at the commencement of the planned STS operations, whether STS operations are to be conducted at anchor or underway, oil type, quantity and planned duration of operation. Where, in exceptional circumstances, the above information is not available 48 hours in advance, the oil tanker discharging the oil cargo shall notify the relevant coastal state Party not less than 48 hours in advance that an STS operation is to occur. Oil Residue Treatment The adopted MEPC.187(59) includes amendments to MARPOL Annex I that clarify oil residues and their management onboard. Oil residue (sludge) is defined to mean the residual waste oil products generated during the normal operation of a ship such as those resulting from the purification of fuel or lubricating oil for main or auxiliary machinery, separated waste oil from oil filtering equipment, waste oil collected in drip trays, and waste hydraulic and lubricating oils. Oil residue (sludge) tanks have been introduced recognizing the increasingly common practice to dispose of oil residue by an approved incinerator. Sludge tanks are to be provided with a designated pump. However, no discharge connections to the bilge system, oily bilge water holding tank, tank top or oily water separators are permitted except that drains, with manually operated self-closing valves and visual monitoring of the settled water, may lead to an oily bilge water holding tank or bilge well provided it does not connect directly to the bilge piping system

MISCELLANEOUS Cargo Hold Washings Due to concerns raised by industry regarding the lack of reception facilities for cargo residues for hold washing water in both the Mediterranean and Gulfs Special Areas, the Committee approved a new MEPC.1/Circ.675 clarifying the disposition of cargo hold washings.

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MEPC 59th Session (13 17 July 2009)

Essentially, the Circular relaxes the discharge requirement for cargo hold washing water containing remnants of any dry cargo material for ships transiting within the "Gulf Areas" and the "Mediterranean Sea" (both as defined in MARPOL Annex V). The discharge of such washings at distances greater than 12 nautical miles from shore within these areas is permitted provided that the cargo is not controlled by the IMDG Code. Bilge Water Treatment The Committee adopted MEPC.1/Circ.677 which contains guidelines to diagnose, maintain, operate and troubleshoot bilge water treatment systems. The guide takes into account: the challenges associated with present-day contaminants; the lack of information available for oily bilge water process equipment with respect to the range of contaminants, particulates, and particulate the use of emulsion forming chemicals that now exist in engine room bilges. The most common system maintenance and operations problems leading to equipment failure are also addressed. VOC Emissions The Committee adopted resolution MEPC.185(59) which contains guidelines for developing management plans to ensure that the operation of a tanker prevents or minimizes the emission of volatile organic compounds. The guide recommends that a target operating pressure during loading be defined as well as a carriage limit of cargo in tanks that is as high as safely possible. These steps, together with minimizing the amount of inert gas added to the tank, can reduce the occurrences of venting and therefore VOC emissions. BALLAST WATER MANAGEMENT BWM Convention Compliance The Committee agreed that no further postponement (as was done for ships delivered in 2009) would be granted for the fitting of equipment - capable of treating ballast water to the D-2 biological standard in the BW Management Convention - to ships having a 3 ballast capacity of not more than 5000m which are delivered in 2010.

This decision took into account the supply and demand side of the marine industry; that is, the increase in the number of approved ballast water treatment technologies which is estimated to produce approximately 800 ballast water treatment units by 2010 and the expected downturn in new construction in 2010. Accordingly, ships, as described above, will need to be fitted with D-2 treatment equipment: if the ship is flying the flag of a signatory State; upon entering the waters of a signatory State; or upon entry into force of the Convention. The Convention enters into force 12 months after ratification by 30 States having a combined tonnage of 35% worlds commercial fleet. As of 17 July 2009, 18 States with a combined gt of 15.3% are signatory. Basic Approvals Granted The Committee granted Basic Approval to three new treatment systems. Blue Ocean Shield System - This system initially treats water by removing organisms of 50 m 3 and above in size via a 250 m /hr stainless steel hydrocyclone/filter unit (see Figure 2). The remainder of the treatment process is through a UV unit which employs low-pressure, highoutput, ultra violet lamps to destroy living microorganisms. Because the photons generated behave as particles rather than as waves, the process has been classified as using Active Substances.

Figure 2 - Blue Ocean Shield Hydrocyclone

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MEPC 59th Session (13 17 July 2009)

EcoBallast System This system (see Figure 3) treats ballast water at uptake - which is advantageous as it reduces sediment built-up and the potential for survival and growth of organisms - and again at discharge.

A 2,000 m /hr version of the system is estimated to weigh in at approximately 10 to 12 tons. Final Approvals Granted The Committee granted Final Approval to four new treatment systems. This approval will now allow a Government to proceed to type approve the system before production beings. NK-O3 BlueBallast System - This system utilizes a shipboard ozone generator that removes nitrogen from ambient air leaving a concentrated oxygen level which is then passed through a high frequency electrical field to produce ozone (see Figure 4). The ozone is then injected into the incoming ballast water to oxidize and neutralize entrained aquatic species. The injected ozone kills a percentage of the entrained aquatic species by direct contact with the remainder either killed or neutralized when the ozone reacts with other chemicals that occur naturally in seawater.

Figure 3 - EcoBallast Helix UV reactor The system, which has undergone full scale 3 testing at 200 m /hr, is comprised of: a 50 m filter with automatic back flushing; a helix UV reactor (see Figure 3) which can accommodate higher flow rates more efficiently; and a high-intensity, medium-pressure ultraviolet lamp, and a control and cleaning unit (flow meter and alarms). Although no chemical compounds are used or added to disinfect the ballast water, the effects of UV irradiation are categorized as the Active Substance. AquaTriCombTM System This fully automated and completely self-contained system is comprised of 2 pre- and post-treatment modules (with a third stand-by module to accommodate cleaning/maintenance). It has been tested to disinfect aquatic species in the ballast water at a 3 capacity of 250 m /hr using 13 kW. Treatment is accomplished by self-cleaning mechanical filtration (35 m) in combination with ultrasonic oscillation and ultraviolet-C radiation. The ultrasound UV-C lamps are self-cleaning which avoids accumulations of bio films or inorganic salts on the quartz-crystal tubes. Compared to other systems using mid- or highpressure UV lamps, the AquaTriComb system employs low-pressure lamps which have a much better efficiency (about 45%) and lower operating costs. Treatment does not involve the use or formation of Active Substances (i.e., substances or organisms, including a virus or a fungus that acts on or against harmful aquatic micro-organisms and pathogens).
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Figure 4 - NK-O3 BlueBallast System In addition to the four integrated modules of this system (Oxygen Generator, Ozone Generator, Ozone Injector and Monitoring and control system) there are several pieces of ancillary equipment required for operation: Power Supply Unit; Compressor - to feed air to the oxygen generator which in some cases can be handled by existing compressors; Refrigerated Dryer - to de-humidify air being fed to the oxygen generator, Ozone Chiller, and Ozone Destruct System to convert any unused Ozone back to oxygen before release to the atmosphere). Corrosion tests were conducted and no corrosive effects were observed due to the rapid disintegration of ozone.

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MEPC 59th Session (13 17 July 2009)

RWO (CleanBallast) System - This system disinfects organisms and bacteria using two main unit operations (mechanical separation by filtering discs and disinfection by electrolosis) at 3 flow rates of up to 500 m /h.

The system contains no moving parts and is 3 modular having capacities from 50 m /hr up to 3 3 5000 m /hr. Figure 6 shows a 100 m /hr system has been used for two years onboard a ship moored in brackish and fresh water with no sign of any corrosion reported to be observed in the ballast water tanks. At discharge, the filters are by-passed and only disinfection is performed to mitigate the discharge of any re-growth during the voyage. Hitachis (ClearBallast) System - This 3-step system purifies water by removing target organisms and other objects through a combined filtration and active substance process. The initial treatment begins with the introduction of a flocculant that is continuously injected into the piping of ballast water treatment equipment using three dedicated pumps. This causes suspended particles in the ballast water to aggregate into larger sized clusters. This is followed by a process using permanent magnets which separates these flocs from the seawater which are automatically transferred to the sludge tank by a conveyor. Finally, any residual flocs are removed by filtration. The system can be scaled up with multiple sets of equipment installed commensurate with the amount of ballast water to be treated. The commercial process ranges from 50 to 10,000 m3/h of ballast water.

Figure 5 - RWO (CleanBallast) System At uptake, self-cleaning disc filters remove particles, sediments and organisms down to 50 m, thus allowing the disinfection step to minimize the use of Active Substances. The electrochemical reactions during disinfection produce Hydroxyl radicals, Chlorine gas and Hydrogen gas (only 0.25% - well below the 4% explosion limit) which are regarded as Active Substances. Greenship Sedinox System - Sediment (all particles 20 m and 80% of particles 10 m) is removed using a multi-hydrocyclone. This is followed by disinfection using an electrolytic process. The Active Substance for disinfection is produced from chloride in surface water using an electrolytic cell that produces Free Active Chlorine which is highly efficient in killing remaining micro-organisms, in particular algae and bacteria.

Figure 7 - Hitachis (ClearBallast) System As of October, 2008, the following systems have been full scale tested.

Figure 6 - Sedinox 100 m3/hr System

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