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Scorpio confirms investing in 146 scrubbers for tanker and bulker fleets

Scorpio has confirmed it is fitting 146 scrubbers across vessels in its dry bulk and tanker fleets to comply with the 1 January 2020 IMO global sulphur cap.

Announcing an agreement to buy and install 15 scrubbers on LR2 tankers in the Scorpio Tankers fleet the company said it was fitting scrubbers to all its remaining 75 owned and leased vessels in its tanker fleet with installations between Q2 2019 and Q2 2020.

The company, which was publicaly against scrubbers until a few months ago sees a competitive advantage in fitting scrubbers, which many smaller owners with less access to finance cannot do.

Emanuele Lauro, Scorpio Tankers chairman & ceo, commented “We have long maintained that the IMO 2020 regulations are both disruptive to the shipping industry generally as well as a powerful demand catalyst for product tankers. Although many well-capitalised and publicly-listed shipowners can source capital and publicise their intentions to pursue scrubbers, most of our industry cannot, and will rely on cleaner fuels to the benefit of ton-mile demand for product tankers.”

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Scorpio Bulkers also confirmed it was fitting scrubbers to 56 owned and leased kamsarmaxes and ultramaxes.

“Having cautiously and patiently evaluated various risks associated with this disruptive change to our industry, we are now confident that substantial savings can be realized and that- with this investment in our vessels- our fleet will remain the most competitive in our marketplace,” Lauro, also chairman and ceo of Scorpio Bulkers.

All told its sees Scorpio installing 146 scrubbers to its tanker and bulker fleets at a cost of between $1.5m and 2.2m per unit with financing covering 60% to 70%. Last week Scorpio Tankers announed a $300m equity raising exercise.

At the start of this year there were just a few hundred scrubber systems installed or ordered for the entire global shipping fleet but there has been a sharp surge in interest over the last six months especially for large vessels where the payback period for scrubber investment could be as low as eight to nine months.

Read about the economics of scrubbers

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