Genco Shipping & Trading today announced officially an order for 17 exhaust gas scrubbers but will wait to see where fuel prices go before possibly ordering more.
In particular, the New York-listed bulker owner plans to watch the price spread between high-sulphur and low-sulphur fuel oils start to settle next year, chief executive John Wobensmith told TradeWinds.
"It's so dependent on spread and it's so dependent on availability of HFS0," he said after participating in a drybulk sector panel at Capita Link's New York Maritime Forum.
"On the capes, there's no doubt in my mind that high-sulphur fuel oil will be available in the bunkering ports that we use."
Earlier today, the company said it will install scrubbers on its capesize vessels with options to put 15 more on the smaller ships in its fleet.
"The question we can't answer yet on the smaller vessels is the availability of high-sulphur fuel in some of the smaller ports where some of our smaller ships operate," he said.
""We want to see more clarity ... before we do that."
He said he expects the company to make a decision on how many more it will order, if any, by the first half of 2019.
"We want to see these fuel markets develop and get a better sense of how the spread is going to price and how the oil majors are going to introduce the 0.5%. Will it be a pure 0.5% or a blended 0.5%?"
He said Genco has based its $34m investment on 17 scrubbers on an expected price spread of $200 per metric tonne.
"Right now our game plan is 17 scrubbers and 15 options ," he said.
If market conditions differ, may you dial back the options, maybe you go more," he said.
At the same time, he said Genco plans to stick with its previously announced fleet renewal plan to replace older ships with newer, more efficient vessels.
"Nothing's changed," he said.
