Management

Fleet Group Management

- Bunker Adjustment Factor by Varisth Agarwal

Most of the Maersk Product tanker vessels operate under Maersk Tankers A/S commercial pools which also include vessels from other owners. The total earnings of the pool are distributed to the vessel’s Owner basis various factors like age of the vessel, cargo carrying flexibility, trade area flexibility etc. For example, a B-class vessel gets 0.5 additional point for ice class and 2 additional points to carry IMO cargo. Each pool point could bring additional 60 to 150 usd/day depending of current pool point value.

Over and above the static factors there is one significant measure which can affect owner’s earnings by almost 2500 usd/day/vessel and that is Bunker adjustment factor or BAF.

BAF is calculated basis vessel’s fuel performance/consumption for various sailing conditions like laden, Ballast, idle, load and discharge. In simple words if a vessel consumes an average of 1 MT/ day higher than its expected and pool average consumption then the owner is directly penalized basis the current bunker price during the month ie. About 300-450usd/MT. Fuel performance of a vessel depends on vessels design, construction, machinery and automation. It also depends on efficient day to day operation, maintenance and reporting which are primarily driven by our onboard crew.

Some of the important points to note for BAF improvements are-

1. Correct fuel reporting in Semark.

2. Additional operational consumption reporting in sub fuel tabs

3. Main Engine consumption (ME SFOC or Hull/propeller condition)

4. Hotel load and boiler consumption during Idle and Load

5. Follow up of best practices checklist shared by Fuelopt team

Below example in table 1 shows the BAF adjustment on final earnings of a vessel and table 2 shows how vessel level BAF is calculated basis consumptions during various sailing conditions.

In line with BAF improvement, this year vessel KPI includes propulsion, AE and boiler consumption monitoring. Propulsion KPI is calculated by fuelopt data team basis previous year performance of the vessel whereas AE and boiler consumption are compared with a common technical baseline for sister vessels. Reports basis below filtration schemes are included or excluded for propulsion performance evaluation.

Data Filters Used

Beaufort: Upto BF 5 Min. Speed: 10.5kn Max. Speed: 15.0kn Min. MCR%: 10.0% Min Report Period: 10h

Added Resistance Annual Decay used

Annual Decay – 5% Drydock Decay – 10%

Weather consideration.

Owned vessel – Hindcast data External Vessels – Hindcast data Our ambition for next year is to replace present propulsion, AE and boiler KPI to BAF in vessel scorecard which will be in line to the earnings seen by vessel owners in Insite digital platform. We believe that the vessel team can directly impact the Topline (vessel earning) by careful monitoring of BAF performance.

Considering the tough market and already optimized daily running cost, the scope of further improvement in owners earning is with fuel performance/BAF. There are various initiatives run across the organization like auto logging, digitalization and equipment modification where our onboard team plays an important role in final execution. Not to forget that every drop of fuel saved has a direct impact on CO2 emission where we all are obliged to contribute for the present and future safe environment. This is now accelerated by our company’s new purpose which includes the word ‘Planet’.