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YARA TACKLES THE UPHEAVAL IN SCRUBBER INDUSTRY

Tuesday, August 11, 2020 

Exhaust gas cleaning system manufacturer Yara Marine Technologies is looking to digitalisation and alternative fuels in the post-IMO2020 and Covid-19 future.

According to COO Ina Reksten (pictured): "2020 will go down in history as the year that changed everything for many industries, not least the marine exhaust gas cleaning segment. The coronavirus turned our world upside down virtually overnight.”

Driven by the impending IMO 2020 sulphur cap, the scrubber market was in the middle of a historic boom when Reksten joined Yara Marine. “In 2019 we had a huge ramp-up in order to deliver on orders,” she says. But stakeholders stepped back toward the end of 2019 to see how regulations were going to be enforced and get a feel for fuel availability and price. Once the situation became clear, they would adjust their plans and proceed with the next steps toward emissions abatement, but that scenario never played out.

“We never got the chance to see how things would have developed before the coronavirus crisis hit. Those that had invested in scrubber technology were happy, but Covid-19 has overshadowed everything since. It hit our core customers, so it has hit us,”  said Reksten.

“We had high hopes for the scrubber market in 2020, but Covid-19 changed all that,” said Shyam Thapa, Yara Marine Innovation Manager. “Travel and distancing restrictions made it difficult to do business, and the resulting fall in oil prices weakened the scrubber case substantially.”

Even before the crisis, though, Yara Marine was planning to expand beyond scrubbers. Reksten said: “We had adopted a new mission, to provide technologies to enable a greener maritime industry. The focus is on what we call ‘close to core’ technologies, in the intersection between green and maritime. We believe the industry needs companies who can provide a scope of technologies outside the traditional maritime sphere. Yara Marine does not have a big technical overlap with our parent company Yara International, but there are still substantial synergies. They have a clear environmental profile, and they are a strong advocate for applying innovative technology in traditional business areas.”

Reksten points out that Yara International is developing the autonomous short-haul product freighter Yara Birkeland, and it commands a fleet of five ships for transport of ammonia. “But Yara Marine is an equipment supplier, not an operator, so the emphasis in maritime business development has to be on technology. We can use digital technology to help our customers meet environmental requirements. We have access to large amounts of data, but what can we do with it? This is a challenge for us just like for everybody else, but we have a parent company that has made great progress in exploiting data to protect the environment.”

Additional factors besides regulation include the open vs closed loop scrubber debate, public sentiment, and disparate port restrictions. Thapa notes that Yara Marine delivers mostly open loop scrubbers, though they offer both hybrid and closed loop. “But right now we have only inline scrubbers, and bypass technologies make up 30% of today’s market, so we plan to introduce U-type products in the near future,” said Thapa.

Thapa added: “In order to help customers meet the IMO’s target of 30% reduction in CO2 emissions by 2030, we are looking into other optimisers, like fuel efficiency. We are also exploring technology to enable the use of ammonia as fuel. Ammonia is one of Yara International’s biggest products, and they have vast experience to share from virtually the entire value chain.”

Looking forward, Reksten says Yara Marine will continue to cultivate new opportunities as they arise, but acknowledges that the transition will not happen overnight.

“In 2019 we were working 100% on just scrubbers, said Thapa. “Now we can put our minds to other tasks, and invest more in R&D. We are expanding to realise the mission of helping to achieve a greener maritime industry. This means using our knowledge to grow into other areas. We are planning for future generations, and that includes more than scrubbers.”

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