MOL issues green bonds to optimise fleet efficiency

MOL issues green bonds to optimise fleet efficiency

Mitsui O.S.K. Lines (MOL) is to issue green bonds, which will be used to help the company raise funds to optimise vessel performance and improve its environmental footprint as part of its Environmental Vision 2030.

The bonds will be issued through a public offering in Japan’s domestic market and are targeted at institutional and individual investors. By doing so, MOL hopes to foster a deeper understanding among stakeholders of its environmental initiatives. It is the first time a company in Japan has issued green bonds aimed at individual investors.

The amount issued is around USD 45m. The funds will be used across a variety of MOL’s green projects, including:

Ballast water treatment systems (BWTS)

BWTS are used across MOL’s fleet to reduce the transfer of species from native environments to non-native ones. MOL established a policy to equip its vessels with BWTS in fiscal year 2014, ahead of issuance of the Ballast Water Management Convention in September 2017. As of April 2018, 114 MOL Group-owned vessels are equipped with ballast water treatment systems.

Sulphur oxides (SOx) scrubbers

Marine scrubbers are used to reduce SOx from ships’ engines. Ships carrying heavy fuel in 2020 will be required to have an on-board functioning scrubber in place to be in compliance with the IMO’s global 0.5 per cent sulphur cap.

LNG-fuelled vessels

MOL will examine the use of liquefied natural gas (LNG) across its fleet. LNG reduces SOx, nitrogen oxides (NOx), particulate matter, and CO2 significantly compared with HFO.

LNG bunkering vessels

These vessels are used to carry out ship-to-ship transfer of LNG. In February 2018, MOL signed long-term charter contract for the world’s largest LNG bunkering vessel. It is slated to supply LNG fuel to LNG-fuelled mega containerships in Northern Europe starting in 2020.

Propeller Boss Cap Fins (PBCF)

PBCF reduce fuel consumption by improving the efficiency of ships’ propellers to limit exhaust emissions. According to MOL, they can boost fuel efficiency by around 5 per cent compared with vessels not equipped with PBCF. The new type of PBCF was jointly developed by MOL, Akishima Laboratories (Mitsui Zosen) and MOL Techno-Trade. MOL Group’s MOL Techno-Trade has started sales of this upgraded version of the PBCF-in use on over 3,200 vessels with all over the world.

Wind Challenger Plan

MOL participates in the Wind Challenger Plan, a joint industry-academia research project led by Tokyo University. It was launched in 2009 and focuses on using advanced sails to provide propulsion for merchant vessels. It aims to reduce vessels’ fuel consumption and CO2 emissions by maximising the use of wind power. The research and verification test phase was completed in September 2017, and the demonstration test and commercialisation phase began in October of that year. MOL will select a vessel to equip with sails within fiscal 2018, aiming to start operation in 2020.

The 20th and 21st series unsecured corporate bonds are anticipated to be issued in August and September 2018, respectively.