Norden calls scrubbers “highly attractive” investment

AUGUST 15, 2018 — Danish operator Norden A/S is making a significant investment in scrubbers in preparation for the January 1, 2020 global cap on sulfur emissions from bunker fuel.

Norden says that for the past 18 months it has been evaluating how the sulfur cap will affect both the shipping and bunker markets.

The cost difference between low sulfur and high sulfur fuel oil is expected to increase significantly for a sustained period, making scrubbers an attractive choice for compliance.

In response, Norden has thus far this year 2018 secured installations of 26 scrubbers with options for five more. Of these, two scrubbers will be installed on newbuildings, 16 retrofitted on selected, owned vessels, and the remaining eight will be installed on long-term chartered tonnage. The costs are estimated to amount to approximately $41 million on owned vessels and approximately $13 million in increased TC hire over the coming years.

Recognizing uncertainties, Norden considers the investment highly attractive with an estimated financial return of approximately 25% within five years on its own vessels with significant upside.