BIMCO to work on new time charter party for CO2 transportation

BIMCO, the world’s largest international shipping association, has started work to develop a new time charter party specifically designed for the maritime transportation of carbon dioxide (CO2).

As disclosed, a specialist drafting team with representatives of owners, charterers, brokers and P&I Clubs as well as technical and legal experts, who are all currently engaged in the carbon capture and storage (CCS) supply chain or have plans to become involved in the coming years, has been meeting regularly since April.

The time charter party CO2TIME, dubbed an “industry first”, will be particularly relevant for the carbon capture and storage market that is emerging as part of global efforts to combat climate change.

The target date for adoption of the charter party is late 2025/early 2026, in time for the first commercial projects expected to be launched in 2028-2030, according to BIMCO.

The form will address technical aspects as well as commercial, insurance and any relevant regulatory considerations associated with CO2 transport.  

The team expects to have a draft ready for wider industry consultation early next year.  

“Shipping has a key role to play in CCS and we want to develop a standard form that addresses the unique characteristics of the transport of CO2 whilst fairly allocating the rights and responsibilities of the parties,” said Marcus Dodds of Capital Gas who leads the drafting team. 

In addition to Capital Gas, the expert team developing the new form includes representatives from Navigator Gas (John Reay), Ineos (Jocelyn Harriman), Orlen Trading (Marceli Marczyński), Babcock (Martin Halcrow), Clarksons (Tommy Baggio and Elwin Taylor), Wikborg Rein (Andreas Fjærvoll-Larsen), Skuld P&I Club (Krester K. Kjær and Peter Hazell) and UK P&I Club (Mark Rudd).

CO2 project contracts are expected to be established on a long-term basis and the drafting team is therefore keen to develop a standard which is sufficiently broad to enable commercial flexibility for the parties.

“Our aim is to develop a form which also caters for the transport of other gases such as liquefied petroleum gases and petrochemical gases, given that the ship’s specifications will typically permit such transport,” added Dodds.

To remind, BIMCO recently signed a memorandum of understanding (MoU) with the International Bunker Industry Association (IBIA) to collaborate on some of the monumental challenges and opportunities within the areas of bunker, marine energy and maritime sectors and help facilitate shipping decarbonization efforts.