K-Line Said to Order First Ship Engine to Cut Nitrogen Oxide

Kawasaki Kisen Kaisha Ltd. (9107), Japan’s third-largest shipping line by sales, has ordered a vessel fitted with an engine to cut nitrogen oxide emissions to meet stricter controls, said three people familiar with the situation.

The Tokyo-based shipping line, also known as K-Line, will put an engine being developed by Kawasaki Heavy Industries Ltd. (7012) in a car carrier to be completed in January 2016, said the people, who asked not to be named before an official announcement. The engine and other changes will add about 10 percent to the cost of the ship, the three people said.

Kawasaki Kisen is also putting a device, called a scrubber, in the ship to remove sulfur oxides from exhaust gases, to meet stricter regulations from the International Maritime Organization, the United Nations’ shipping division, set to be introduced in 2015, the people said. World shipping emits about 2.7 percent of the global total of greenhouse gases, according to an IMO study.

Jitsuo Narita, a spokesman for Kawasaki Kisen, declined to comment.

Kawasaki Heavy has developed a ship engine to reduce nitrogen oxide emissions to meet IMO regulations and is working to optimize performance, the company said in a statement in May 2012. Teppei Kobayashi, a spokesman for Kawasaki Heavy, declined to comment on who would buy the engine.

Ship pollution rules are set to tighten in coming years to help reduce the emission of greenhouse gases. The IMO will limit the maximum amount of sulfur oxides emissions from ships to 0.1 percent of the fuel weight in emission control areas, according to its website. The IMO is also set to toughen rules on nitrogen oxide emissions on ships built from 2016, according to the website.

Kawasaki Kisen said in September it was ordering four new carriers to be completed in the fiscal year ending March 2016, according to the company.

The new engine will be fitted on one of those four ships, whose construction is starting before 2016, earlier than needed under the new IMO regulations, the three people said.

To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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