April 2nd – 3rd 2020
The 7th International Symposium on Shipping Operations, Management and Economics (SOME 2020)
Arlie Sterling, President of Marsoft will be giving a paper at this symposium entitled:
Replace or Renew - Evaluating Renewal Options for Middle-Aged Ships
Modern commercial vessels are built to meet increasingly stringent efficiency standards and owners have aggressively adopted energy saving designs. The relatively high fuel consumption of conventional ships puts them at a competitive disadvantage and lenders may no longer consider them to be acceptable collateral. Initiatives like the Poseidon Principles will put increasing pressure on borrowers in that regard.
At the same time there has been considerable progress in technology suitable for retrofitting conventional vessels. This paper considers a wide range of retrofitting options and their likely performance impact is evaluated using resistance and engine performance models developed by the MIT SeaGrant Lab and based on extensive and proven tank tests. The financial performance takes the output of the vessel performance models and optimizes speed choice to maximize profitability under a wide range of market and fuel prices.
The results to be presented are relevant not only for owners considering retrofitting their fleet but also for the choice of building a new ship instead of investing in an existing fleet.
Arlie will summarise the financial implications for a VLCC and describe the scope of the remaining research underway.
For more details of the symposium, Arlie Sterling’s presentation and Marsoft’s approach to decarbonization and the Poseidon Principles contact one of our offices.