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A.P. Moller – Maersk links new $5.0bn revolving credit facility to its CO2 performance

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A.P. Moller - Maersk links new $5.0bn revolving credit facility to its CO2 performance. Image: Pixabay
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A.P. Moller – Maersk secures a new sustainability-linked revolving credit facility of $5.0bn through a syndicate of 26 selected banks. This is the first bank refinancing arranged by Maersk after its transformation from a diversified conglomerate to a global container logistics company.

The facility refinances the undrawn $5.1bn facility maturing in 2021 and has a tenor of five years which may be extended by up to two years. It will be part of the company’s liquidity reserve.

“We have received strong support from our global relationship banks. The facility was substantially oversubscribed, and we are pleased with the terms and conditions of the new facility. With the new facility we have extended the maturity profile of our finance commitments, while aligning with our sustainability ones,” highlights Henriette Hallberg Thygesen, CEO of Fleet & Strategic Brands.

The credit margin under the facility will be adjusted based on Maersk’s progress to meet its target of reducing CO2 emissions per cargo moved by 60% by 2030, which is significantly more ambitious than the IMO target of 40% by 2030 (all 2008 baseline).

In 2018 Maersk announced its commitment to becoming carbon neutral by 2050. The new finance facility affirms Maersk’s efforts to drive sustainability into its operations and supply chains.

“We are determined to reach our ultimate target of becoming fully carbon neutral by 2050, and this agreement serves as another enabler for us to deliver on that ambition. Given the lifespan of our fleet, we need to find new and sustainable solutions to propel our vessels within the next 10 years. To realize this ambitious commitment, we are partnering with researchers, regulators, technology developers, customers, energy providers – and now banks,” explains Henriette.

Banco Santander S.A., London Branch, Bank of America Merrill Lynch International Designated Activity Company, Barclays Bank Plc, BNP Paribas, Citibank N.A. London, Commerzbank Aktiengesellschaft, Crédit Agricole Corporate and Investment Bank, Danske Bank A/S, Deutsche Bank, Handelsbanken, HSBC France, MUFG, Nordea, SEB and Standard Chartered Bank, joined as mandated lead arrangers.

Banco Bilbao Vizcaya Argentaria, S.A., London branch, DNB Bank ASA, Industrial and Commercial Bank of China (Europe) S.A., Brussels branch, ING Bank, J.P. Morgan Securities Plc, Mizuho Bank, Ltd., Morgan Stanley Bank International Limited, Natwest Markets Plc, Sumitomo Mitsui Banking Corporation, Société Générale and the Standard Bank South Africa Limited, Isle of Man branch, joined as lead arrangers.

Crédit Agricole and SEB acted as Sustainability Coordinators. MUFG acted as Documentation Agent and BNP Paribas as Facility Agent.

Environment

Port joins Hunter group pursuing United Nations sustainability goals

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Port joins Hunter group pursuing United Nations sustainability goals. Image: Port of Newcastle
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Port of Newcastle is one of seven Hunter institutions that have united to advocate for and drive local adoption of the United Nations’ Sustainable Development Goals.

Group members – PON, City of Newcastle, Compass Housing Services, Hunter Water, Kumalie, Port Waratah Coal Services and University of Newcastle – have committed to raise awareness and actively implement the SDGs in the region.

Port of Newcastle’s Environment, Planning and Sustainability Manager, Jackie Spiteri, said the move was part of efforts to become a more sustainable and responsible organisation.

“The UN’s 17 SDGs form the blueprint for a better and more sustainable future for all by addressing the global challenges we face, including those related to poverty, inequality, climate change, environmental degradation, peace and justice,” Ms Spiteri said.

“We have joined other leading Hunter institutions to create a shared vision in this area, build our region’s capability and look at what that looks like in practice, including how that affects the supply chain, procurement and strategic direction of each party.”

Port of Newcastle last month released its 2019 Sustainability Report, which measures the organisation’s progress in achieving its sustainability commitments and its contribution towards the social, economic and environmental wellbeing of the Hunter and regional New South Wales.

It is also moving to 100% renewable energy by 2021 and is continuing to transition all its vehicles to electric by 2023.

Ms Spiteri said a STEM scholarship program for Aboriginal students, currently being developed through a partnership with University of Newcastle, and programs to promote the empowerment of women in maritime, were just part of the Port’s broader commitment to sustainable and responsible operations.

“Minimising our environmental footprint, diversifying trade and creating a more resilient economy requires a determined, long-term effort, with co-operation between the Port and its stakeholders,” Ms Spiteri said.

“While we look to what the Port could be in the decades ahead, it is clear there are things we can do today to make the way we operate the port more sustainable and responsible.”

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Environment

Yang Ming fulfills green promise carbon emission reduced 51% in 2019

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Yang Ming fulfills green promise carbon emission reduced 51% in 2019. Image: Flickr/ JAXPORT
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To achieve the pursuit of global sustainability and respond to customers’ growing awareness about environmental issues, Yang Ming Marine Transport Corp. formulated plans to build an echo-friendly fleet a decade ago with the aim to proactively enhance ship energy efficiency and reduce greenhouse gas emission.

In 2019, Yang Ming fleet’s average carbon intensity (CO2 emissions per transport work) per Teu/Km significantly reduced by 51% compared with the level in 2008, from 99.4 g/teu-km to 48.1 g/teu-km, accomplishing the IMO target of reducing carbon intensity by at least 40% by 2030, eleven years ahead of schedule. Through continuous fleet optimization, Yang Ming has fulfilled its promise of energy saving and emission reduction.

GHG emission plays a critical role in climate change mitigation. In this respect, IMO has adopted strict regulations to address the issue and set the goals to cut global shipping carbon intensity by at least 40% by 2030 and 70% by 2050 when compared to 2008.

To achieve the targets, Yang Ming has formulated several long-term strategies, including implementing 12 vessel modification and optimization projects, and accelerating the vessel renewal plan by eliminating vessels over 20 years of age and adding ten 2,800 TEU class, twenty 14,000 TEU and fourteen 11,000 TEU class echo-friendly smart vessels.

In addition, Yang Ming has cooperated with weather service provider Weathernews Inc. to build a monitoring system to manage fuel consumption and reduce GHG emission, and further evaluate the possibility of developing duel-fuel engine such as LNG or other engines that can perform with carbon-neutral alternative fuels.

As for sulphur oxide emission, Yang Ming ensured an early transition to use low sulfur fuel oil at Kaohsiung port and Shenzhen port in 2018. In the fourth quarter of 2019, Yang Ming’s fleet has switched to very-low sulphur fuel oil with sulphur content lower than 0.5% and reduced sulphur oxide emission by 80% compared to traditional heavy fuel oil.

Furthermore, Yang Ming has actively participated in vessel speed reduction programs initiated by National Oceanic and Atmospheric Administration and Taiwan International Ports Corporation, LTD to well protect the marine ecology.

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Environment

Samsung Heavy Industries and Bloom Energy advance plans for clean power ships with joint development agreement

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Bloom Energy and Samsung Heavy Industries, a part of Samsung Group, have signed a joint development agreement to design and develop fuel cell-powered ships. The two companies will work together to realize their vision of clean power for ships and a more sustainable marine shipping industry.

“By signing this joint development agreement, SHI has a plan to develop eco-friendly ships that will lead the future of the industry,” said Mr. Haeki Jang, vice president of shipbuilding & drilling sales engineering at SHI. “Our goal is to replace all existing main engines and generator engines with these highly efficient solid oxide fuel cells to align with the International Maritime Organization’s 2030 and 2050 environmental targets.”

SHI is actively participating in all of the relevant activities during the joint development, from early studies to project completion, in order to build highly efficient fuel cell-powered ships. In alignment, Bloom Energy has created a dedicated, cross-functional team of engineers to adapt Bloom Energy’s Servers to the unique requirements of the marine environment.

SHI and Bloom Energy are actively working towards the next milestone in this development with a target to present the design to potential customers in 2022. Following commercialization, the two companies anticipate that the market for Bloom Energy Servers on SHI ships could grow to 300 megawatts annually.

This joint development work aligns with the International Maritime Organization’s mandate to meet emissions reduction targets by 2050. Because the fuel cells create electricity through an electrochemical reaction, without combusting the fuel, these ships would be able to improve air quality with a reduction of particulate emissions, including NOx and SOx, by more than 99 percent, and shrink carbon emissions.

“The marine shipping industry has the ability to make a substantial impact on emissions and air quality at ports and across our planet,” said KR Sridhar, founder, chairman and CEO of Bloom Energy. “We see a collaboration with one of the world’s largest shipbuilders, SHI, as a moment to make measurable strides in reducing emissions and extending our mission for clean, reliable energy to the seas.”

The joint development agreement between SHI and Bloom Energy follows an Approval in Principle for fuel cell-powered Aframax crude oil tankers from DNV GL, the internationally accredited marine shipping registrar and classification society, announced in September 2019. The next class of ship to be submitted for design approval is the LNG carrier.

 

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