Progress on Biofuel Clause for Time Charter Parties

The new target date reflects BIMCO’s commitment to develop a clause that supports safe and sound use of biofuel under time charter parties. The subcommittee’s focus is on clear responsibilities, specifications and procedures for supply and use, enabling owners and charterers to manage risks while advancing decarbonisation goals.

One area under consideration is the definition of what constitutes “biofuel”, including recognised standards for specifications and blends, while allowing flexibility for alternative arrangements subject to testing and approval.

Fuel quality and suitability are also central to the discussions. The clause is expected to address requirements for stability and compatibility with the vessel engines, as well as procedures for dealing with non-compliant fuel, including corrective measures.

Preparations for biofuel use are another important aspect, including considerations around tank cleaning and crew competence. Segregation of different grades or batches, and rules for comingling or additives, are also part of the work.

Commercial and performance implications are being reviewed, such as how speed and consumption warranties might be adjusted to reflect the lower calorific value of biofuels compared to conventional fuels.

Finally, practical elements like notice periods, timelines for consumption and handling of remaining fuel at redelivery are under discussion to provide clarity and minimise disputes.

By addressing these areas, the clause aims to create a balanced framework that supports decarbonisation while managing operational and contractual risks.