World Bunkering Summer Issue 2019 by Constructive Media

Spring 2019 Summer

THE OFFICIAL MAGAZINE OF IBIA

SHARPER FOCUS VISION OF IMO 2020 SULPHUR CAP GETTING CLEARER

INSIDE THIS ISSUE: INTERVIEW: THE ‘KYS’ PRINCIPLE STUDIES SUPPORT LNG AND SCRUBBERS REGIONAL FOCUS: MEA + INDIAN SUBCONTINENT

EDITOR’S LETTER

THE CLOCK IS TICKING AWAY While, as ever, this issue covers a wide range of topics the now urgent need to be ready for the impending 0.50% sulphur limit dominates many of our pages

his is true too of the reports from IBIA which show just how busy your organisation has been, both representing the industry at global forums, and especially the IMO, and in keeping you, the members, informed of the massive changes that are underway in the bunkering sector. IBIA’s director, Unni Einemo, attends IMO meetings and has written a highly informative feature on the implementation of the cap. While I hope all pages in this issue are of value to IBIA members, Unni’s clear account of IMO’s 2020 Vision is absolutely a ‘must read’. Talking of ‘must reads’ anybody who still thinks non-compliance is an option, either with the current 0.10% ECA sulphur limit or the impending 0.50% limit outside the ECAs, really should look at our News section item that reports the use of a drone by Danish authorities. It is fitted with a so-called ‘sniffer’ capable of measuring sulphur emissions. By entering the ship’s exhaust gas plume, the drone can estimate the amount of sulphur in the fuel. This drone will operate in an area north of the Great Belt but it must be very likely that similar ones will sooner or later be on the prowl over busy shipping lanes worldwide. Our News pages do however also demonstrate that the industry is looking beyond the potential issues caused by the 2020 deadline and to the much greater challenge of working towards a low carbon future. The IMO-supported Global Industry Alliance to Support Low Carbon Shipping (GIA) is expanding and already includes big names including leading shipowners and operators, classification societies, engine and technology builders and suppliers, big data providers, oil companies and ports.

World Bunkering SUMMER 2019

In an age when we have all become wary of ‘fake news’, independent studies can be reassuring. As our Scrubbers feature notes, the Clean Shipping Alliance 2020 (CSA 2020), which promotes the use of scrubbers, has been highlighting a detailed study of the composition and quality of scrubber washwater. The threeyear study was led by cruise giant Carnival but the washwater samples were then assessed at ISO accredited independent laboratories. The results were then evaluated by Classification Society DNV GL’s Maritime Advisory Services. The samples analysed were found to be consistently well within the allowable IMO criteria and regulatory limits and so backed CSA 2020’s contention that open loop scrubbers do not pose an environmental threat. Meanwhile, as reported in our LNG feature, SEA\LNG and the Society for Gas as a Marine Fuel (SGMF) are also pleased with the results of a study. They have been able to announce that research they commissioned has found that greenhouse gas reductions of up to 21% are achievable now from LNG as a marine fuel, compared with current oil-based marine fuels over the entire life-cycle from ‘well-to-wake’. It also confirmed that emissions of local pollutants, such as sulphur oxides, nitrogen oxides and particulate matter, are close to zero when using LNG compared with current conventional oil-based marine fuels.

However LNG is not the only kid on the block and this issue also reports on biofuels, battery-fed electric propulsion and wind assist technology. All in all this is another informationpacked issue that reflects the challenges, uncertainties and, it must be stressed, opportunities that now face those who work within the bunkering industry.

David Hughes Editor

Proponents of the use of LNG have had to respond to criticism, including from environmental groups, that it is not a viable bridging fuel towards zero carbon emissions. They are now able to refer to a substantial piece of research to back up their case that it is.

Chairman’s Letter

Director’s Report

IBIA Events Preparation for 2020 Implementation!

IBIA Asia Annual dinner a great success

IBIA Africa South Africa readies for 2020

Interview The ‘KYS’ principle

News Drone ‘sniffs’ sulphur emissions

Environment IMO’s 2020 vision

Africa New opportunities beckon

CONTENT

Innovation Gothenburg’s bunkering app

Middle East No shortage of would-be rivals for Fujairah

Event Review Views from the ‘Hollywood of bunkers’

Indian Subcontinent Making progress

Legal Singapore corruption charge

Mauritius On the move

Bio Fuels Big names embrace bio

Oil Majors Adapting to a changing bunker market

LNG Study backs LNG

Company News

New IBIA Members

Diary

Equipment & Services Class approval for wind power

Next Issue

Scrubbers Reprieve for scrubbers

Fuel Management Preparing for the 0.50% sulphur limit

Russia Russian marine fuel production after 2020

Publisher & Designer: Constructive Media ibia@constructivemedia.co.uk Editor: David Hughes anderimar.news@googlemail.com Deputy Editor: Unni Einemo unni@ibia.net Project Manager: Alex Corboude alex@worldbunkering.net On behalf of: IBIA Ltd Office 239 New Broad Street House 35 New Broad Street London, EC2M 1NH, UK Tel: +44 (0) 20 3397 3850 Fax: +44 (0) 20 3397 3865 Email: ibia@ibia.net Website: www.ibia.net

The views expressed in World Bunkering are not necessarily those of IBIA, or the publishers unless expressly stated to be such. IBIA disclaims any responsibility for advertisements contained in this magazine and has no legal responsibility to deal with them. The responsibility for advertisements rests solely with the publisher. World Bunkering is published by Constructive Media on behalf of IBIA and is supplied to members as part of their annual membership package.

Constructive Media 50 George Street, Pontypool NP4 4PR Tel: 01495 740050 Email: ibia@constructivemedia.co.uk www.worldbunkering.net

While 2020 is clearly a momentous step in the history of the maritime and bunkering world it seems to have totally overshadowed all other topics of conversation

lthough this is understandable given the impact it is set to have, there are other things happening in our sector that are worthy of our time and consideration. So, for the first time in quite a while I will aim to focus on things other than the 0.50% sulphur limit in my address. Beyond the immediate concerns surrounding 2020 life continues apace and here at IBIA, while we are extremely focused on supporting our members make the transition, we are also looking to ensure that we don’t lose focus on other aspects of the IBIA mandate. Interaction with our members is at the core of our ethos as an association and we are making concerted efforts to provide opportunities for our members to get together through IBIA organised events as well giving members the opportunity to meet the IBIA team at a variety of other industry events.

With such lofty ambitions it’s no surprise to see that we have started 2019 at lightening pace with IBIA represented at flagship events in London, Singapore, Cyprus, the Middle East and the USA. The coming months will continue this trend with further representation at events in Oslo, Gibraltar, Nigeria and Hamburg to mention but a few. As if this wasn’t enough we also have a program of IBIA organised regional events spanning the remainder of the year. At the end of May we have the IBIA Africa Conference 2019 in Cape Town. Following the success of last years event, held in Tenerife, the program of training and conference sessions represents a mix of topics spanning the IMO Regulatory Framework through to the future of the African bunker market. On June 18, we have a collaborative event being held in London in conjunction with the UK Chamber of Shipping.

IBIA has always maintained a strong focus on offering a platform for our members to enhance their knowledge through interaction with industry peers and friends via IBIA events and while we seek to continue in this vein, 2019 is set to be different in that it will be a year in which we offer members significantly more in the way of IBIA organised events globally.

September sees us jet off to Jamaica for our second consecutive year, and the beautiful setting of Montego Bay, for the IBIA Caribbean Bunker Conference 2019. The conference will offer delegates an ambitious programme focusing on the Caribbean and related bunkers markets covering the US Gulf Coast, Panama and beyond.

The idea behind this is a simple one, in that we offer a range of different events in, different locations so we can not only offer support by keeping members up to date with what’s happening on a global basis, but also by giving our members the opportunity to address those localised issues that are of specific importance in a particular location or region.

Moving into October we have, in a slightly unfamiliar time slot, our flagship event of the year: The IBIA Annual Convention, which will be held in the historic city of Istanbul.

We can’t expect all of our members to spend their time travelling the globe to ensure that they take part in IBIA events, so we are doing what we can to bring IBIA to our members. World Bunkering SUMMER 2019

In looking to go above and beyond what was achieved at last year’s record event in Copenhagen we are confident that the timing of the convention and the unique location, that sits between two continents, will allow us to harness a much greater membership participation and interaction.

The fact that it comes towards the end of 2019 also means that it is probably the last meaningful opportunity to garner any last-minute information that will help with the transition to 0.50% sulphur fuels. It’s very easy to suggest that this kind of increased activity across the year is simply as a result of IBIA trying to showcase its prowess prior to the upcoming reforms but let me assure you that these initiatives represent a more focused approach that will be perpetuated moving forward. If IBIA is to fulfil its potential as a truly global association, we need to fully represent all of our members across the globe whom we have committed to support. This can only be done by extending our reach. 2020 only represents the beginning of the challenges associated with the global change and given the drive for a cleaner and greener world it will certainly not signal the end of legislative reform which makes IBIA’s role in its support of the membership all the more important. As with most conversations at this time I find myself inadvertently drawn back to the topic of 2020, which I wasn’t planning on talking too much about in this latest instalment, however, I have been somewhat unsuccessful, yet again, in avoiding this particular hot potato!

Michael Green Chairman 7

CHAIRMAN’S LETTER

JOIN THE IBIA WORLD TOUR

DIRECTOR’S REPORT

A CLEARER PICTURE We hear a lot about the uncertainties caused by the 2020 sulphur limit, but uncertainty is not new and we actually already know quite a lot

hat may sound overly optimistic and simplistic, but think about it: isn’t it true that most of the things we speculate about are things that we can never really know about the future anyway? Bunker fuel prices, demand, availability and quality have always been subject to fluctuations and variability. Likewise, the extent of compliance with sulphur limits and how they will be enforced around the world have mostly been guesswork until after the event. We know by now what needs to happen in the supply chain from refineries through to the actual bunker delivery to ship in order to be ready for the 2020 sulphur limit; we even have a pretty good idea of how much (or little) high sulphur fuel oil will be needed by ships with scrubbers globally. We know that many refiners and suppliers have their plans in place. We also know what needs to happen on ships with regard to tank cleaning and that they need to start buying 0.50% sulphur compliant fuels prior to 1 January 2020. What is needed now is clear signals and communication from all parties about their intentions to get the timing right. Several products meeting the 0.50% sulphur limit have already been made, tested and trialled by ships and so far the experience has been positive. We should add that everyone involved in this have taken good care to ensure they prepared and handled these fuels properly. This is what we need from all participants going forward. Sure, many things may not got to plan, but help is at hand. IBIA has contributed actively to provide clarity and help, in particular in two areas: the IMO’s regulatory framework and forthcoming industry guidance coming from the Joint Industry Project (JIP).

World Bunkering SUMMER 2019

The goal of the JIP is to produce guidance on the safe supply and use of fuels meeting the 0.50% sulphur limit. The JIP is a collaboration involving industry experts from fuel testing agencies, the entire bunker supply chain, and end users. We hope this comprehensive industry guidance will be made publicly available in August. It covers the responsibilities of bunker suppliers and users and it is packed with practical advice on dealing with the anticipated types of max 0.50% sulphur fuels coming into the market, including the dreaded issue of potential incompatibility between different fuels. Actually, this is nothing new either, but because the variability of fuels is expected to be greater than it has been until now, best practices and diligence will become more important. Since the previous issue of World Bunkering went to print, the 6th session of the IMO’s Sub-Committee on Pollution Prevention and Response (PPR 6) has worked out comprehensive guidelines relating to consistent implementation of the 0.50% sulphur limit, so that these can be sent to the 74th meeting of the Marine Environment Protection Committee (MEPC 74) in mid-May for any final tweaks and approval. This will be the last MEPC session before 2020 and I will be there as IBIA’s IMO representative to push for the best possible outcomes for our members. You can read more about this in my “IMO’s 2020 vision” article in this issue. I am confident that after MEPC 74, we will have a very good idea about many of the “what ifs” and uncertainties that 2020 is expected to bring, including how to deal with non-availability situations.

and do our utmost to help guide the industry through this period – hence this will remain a top priority. We do help in other areas as well but we have limited resources. I am happy to report, however, that IBIA has had some input into the process as the Port of Rotterdam works toward implementing a bunker supplier licencing scheme, an effort that IBIA applauds and supports.

Unni Einemo Director International Bunker Industry Association unni@ibia.net

Of course, the 2020 sulphur cap isn’t the only thing that is important to the bunker industry, but it is a huge change and IBIA continues to see the need for us to provide clarity where confusion reigns

IBIA EVENTS

PREPARATION FOR 2020 IMPLEMENTATION! IBIA’s purpose is to continually support the bunker industry by working closely with all stakeholders, and ensuring good quality information through events and training, says Sofia Konstantopoulou, IBIA’s Global head of Marketing & Events

ince the beginning of the year and because of the historic changes in the industry, IBIA has also been entrusted by numerous external parties globally to actively contribute, support and promote their events. This is a great opportunity for us to offer our expertise and reach out to our members in different regions. Back to our activities. Within the first quarter of 2019 we held the IBIA Annual Dinner, and this year we did things differently. We successfully introduced a new online platform giving guests the opportunity to meet online before, during and after the Dinner. This innovative networking tool has proved that IBIA both develops personal relationships and leads by example using the latest technological means to maximise advantages for the industry stakeholders. Also, we couldn’t resist the idea of giving a twist to our traditional speeches, so we came up with a Star Wars themed video. People called it ‘captivating’ and we believe that we managed to communicate our messages to our 1,000 guests in an engaging way. IBIA would like to extend thanks to our Diamond sponsor S&P Platts, our Silver sponsor Gulf Petrol Supplies and our Bronze sponsors BP Marine and Total. We hope you enjoy the pictures from this memorable night!

In April, Bunkernet in partnership with IBIA successfully organised a half day conference during the East Med Marine Exhibition in Limassol, Cyprus. The exhibition has been the leading Technical Marine and Oil & Gas exhibition in the Eastern Mediterranean for over 15 years. This was an opportunity to further discuss the 2020 sulphur cap regulation implications almost half a year before the official implementation date. Simultaneously, IBIA Asia hosted more than 200 people, both local and international IBIA members, at the Annual Asia Dinner, offering an A-Class platform for networking opportunities. You can read more about it in the IBIA Asia report. IBIA Africa is excited to announce our next training day and conference which will be held in Cape Town at the Royal Cape Yacht Club 28 – 30 May 2019. This will be our 4th Regional Conference in Africa; check out the IBIA Africa report for more details. Soon afterwards on 18 June, the UK Chamber of Shipping and IBIA will join forces for a half day conference in London at the premises of the UK Chamber Shipping, to discuss the IMO 2020 Sulphur Cap, often described as a oncein-a-generation disruptor to shipping’s commercial environment. It is a hotly anticipated conference, taking place just after the IMO meetings where pending issues are expected to be finalized.

The conference will cover topics related to availability, enforcement, handling of new fuels, reporting of compliance issues and mitigation of safety issues, fuel disputes, scrubber installations and discharge of open loop wash water. We have designed this conference to help shipowners get up to speed on everything they need to know to ensure compliance with the regulation. It will also provide the opportunity to those attending to exchange views on challenges and how others are preparing. A networking drinks reception will be held following the event. Set to be one of industry’s landmark events of 2019, the IBIA Caribbean Bunker Conference (ICBC) – The Caribbean Journey to 2020 Compliance – is hosted by the Maritime Authority of Jamaica and presented in partnership with Ship & Bunker. ICBC takes place from September 10-13, 2019 at the Iberostar Grande / Suites Hotel in Montego Bay, Jamaica. Positioned at a key point on the global IMO 2020 timeline when the majority of vessels will have just begun their transition to 0.50% bunker fuels, ICBC will be one of the first events where delegates can benefit from real world experiences of the reality of IMO 2020.

World Bunkering SUMMER 2019

On September 10, IBIA is also offering its Bunkering Training Course with renowned Course Director and IBIA board member, Nigel Draffin – Author of 12 books on Bunkering. The IBIA Annual Convention 2018 in Copenhagen was rated as the #1 conference of 2018 in the global shipping industry by AllAboutShipping. co.uk. The IBIA Annual Convention 2019 promises to be even better! IBIA would like to welcome you to the IBIA Annual Convention 2019, on 22-24 October 2019, at the Ciragan Palace Kempinski and Ottoman imperial palace and hotel on the banks of the Bosphorus in Istanbul, Turkey.

IBIA EVENTS

CBC features an ambitious programme focusing on the Caribbean and related bunkers markets including USGC, Panama, and beyond. It will provide critical insight, training, and networking opportunities for all stakeholders including shippers, carriers, suppliers, traders, port authorities, regulators, NGOs, brokers, lawyers, surveyors and academics.

We have secured a private tour of the Hagia Sophia, a stunning and historically significant building in the heart of Istanbul, as well as a luxury Bosphorus boat trip. The IBIA Annual Convention 2019 will be hosted by the Turkish Chamber of Shipping and supported by the Turkish Bunker Association. We would like to thank our Gold sponsor IstanbulBunker 2020 Group, our Silver sponsor Peninsula and our individual sponsors Cockett Group, Asmira Bunker and Terpel. We will conclude our series of events with a conference which will run with our new partner, the Americas Gas and Power Summit. The conference will take place on 13 November 2019 in Panama, the regional hub for global for LNG and Energy. It has been developed as a platform for gas and power cooperation in the Americas with the participation of key regional and international stakeholders along the entire gas value chain.

This year will see renowned personalities of the shipping community joining forces to elevate IBIA’s events. We warmly invite you to participate in our conferences and/ or training opportunities, as we believe you will find them driven and beneficial.

If you want to become a speaker, sponsor or find out more about our events, you can contact Sofia Konstantopoulou at sofia. konstantopoulou@ibia.net. Follow our social media: internationalBunker IndustryAssociation/ ibiabunkers https://linkedin.com/ company/ibia.net @IntBunkIndAssoc Website: Ibia.net and ibiaconvention.com

The IBIA Annual Convention is one of the most anticipated bunker and shipping events, held annually in different countries around the world, with highly acclaimed speakers, sponsors and delegates. In addition to our two-day IBIA Convention and Exhibition, delegates have the opportunity to join our industry-leading IBIA Bunker Training Course and a workshop. Attendees, just like IBIA’s members, will encompass every part of the bunker industry value chain from well to stack, as well as associated service providers, authorities and relevant experts. IBIA has arranged a dynamic series of sessions in diverse topics which will cover a broad spectrum of issues, with an emphasis on the future challenges facing the bunker and shipping industry. We will also have exclusive social events for our delegates.

World Bunkering SUMMER 2019

IBIA EVENTS

IBIA ANNUAL DINNER 2019

IBIA EVENTS

IBIA ANNUAL DINNER 2019

IBIA EVENTS

CONFERENCES AND COURSES

Nicholas Argyrou, Bunkernet’s General Manager and Unni Einemo IBIA’s Director

Unni Einemo speaking at the Bunkernet conference

7th Bunkernet Bunker Conference, Jointly Organised with IBIA

IBIA Bunker Training course at the 7th Bunkernet Bunker Conference

World Bunkering SUMMER 2019

2019 IBIA EVENTS PROGRAMME MAY 8-9 22 - 23 28 - 30 30 JUNE 12 - 13 18 26 - 27 JULY 10 - 11 24 - 25 AUGUST 7-8 21 - 22 SEPTEMBER 4-5 10 - 13 25 - 26 OCTOBER 9 - 10 22 - 24 23 - 24 NOVEMBER 6-7 13 - 15 20 - 21 DECEMBER 4-5 18 - 19 FEBRUARY 2020 24

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015) IBIA Africa Conference 2019 IBIA Africa AGM

Singapore, Asia Singapore, Asia Cape Town, South Africa Cape Town, South Africa

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) IBIA and UK Chamber of Shipping Seminar 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia London, UK Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) IBIA Caribbean Bunker Conference 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Montego Bay, Jamaica Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) IBIA ANNUAL CONVENTION 2019 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Istanbul, Turkey Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) IBIA Americas Summit 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Panama Singapore, Asia

2 Days Basic Bunkering Course (SS600:2014 & TR48:2015) 2 Days Enhanced Bunkering Course (SS600:2014 & TR48:2015)

Singapore, Asia Singapore, Asia

IBIA Annual Dinner 2020

London, UK

2019 EVENTS IBIA SUPPORTS & WILL PARTICIPATE IN MAY 21 - 22 JUNE 3 JULY 22 - 23 AUGUST 15 - 16

IBA Maritime and Transport Law Conference

Oslo, Norway

DNV GL Conference supported by Lloyd’s List

Oslo, Norway

West African Ports & Rail Evolution

Lagos, Nigeria

African Ports Evolution

Durban, South Africa

*For more information about the training courses and events, please visit IBIA’s website www.ibia.net World Bunkering SUMMER 2019

JOIN US Membership Benefits By joining IBIA you will become part of a global network of bunker industry experts who collectively form the world’s leading authority on bunkers. Not only will you have access to a wealth of information and insight (we publish newsletters and industry updates on current issues) which offer pragmatic advice for managing the industry’s challenges; members also have the potential to shape and influence both international and local legislation. This happens through IBIA’s Working Groups which are responsible for developing industry guidance, participation in IMO correspondence groups, solving long-term industry issues, and addressing both commercial and technical issues.

Corporate • Register up to three offices in the same country • Free attendance or discounts on IBIA training courses/ conferences/seminars/events • Discounts on other industry events • IBIA Board member eligibility • IBIA Working Group eligibility • Multi-subscription to World Bunkering magazine • Eligible to book tables at the prestigious IBIA Annual Dinner • Representation at IMO (International Maritime Organisation) • Use of IBIA logo on your website and stationery • Access to online membership directory • IBIA mediation and dispute resolution • IBIA membership certificate

Individual • IBIA board member eligibility • IBIA Working Group eligibility • Free or discounted IBIA training courses/conferences/ seminars/events • Individual discounts on other industry events • Subscription to World Bunkering magazine • Representation at IMO (International Maritime Organisation) • Use of IBIA logo on your website and stationery • Access to online membership directory • Eligible to book up to 4 tickets at the prestigious IBIA Annual Dinner • IBIA mediation and dispute resolution • IBIA membership certificate

New Member Benefits Multiple year discounts 15% discount for 3 years membership, (Paid in one instalment) – Guarantee no membership increases for the next 3 years.

The new website is designed so members can easily access and change their own information.

IBIA Members fees Individual membership: £250 Corporate membership: £1,250

Please note that all of the above publications can also be downloaded by members by visiting www. ibia.net and logging into your account. Please then go to the download section of the website.

This directory is only available to IBIA members.

IBIA World Bunkering Magazine – free copies for Members of IBIA Please note non-members are requested to subscribe to the magazine at a cost of Pounds Sterling £45, £60 or £80 depending on location.

IBIA Logo Both Corporate and Individual members will have the right to use IBIA’s logo on their website and stationery.

Up to 20 additional free copies of the magazine are offered to buyer members of IBIA for forwarding to their vessels.

If you are interested in learning how you can become involved then please get in touch.

IBIA Members On-line Directory If your details are not correct, please log on to our new website and update them on your members page.

IBIA ASIA

ANNUAL DINNER A GREAT SUCCESS Regional Manager Simon Neo reports on the recent gala dinner and changes to the composition of the IBIA Asia Executive Committee known as the ExCo

here were some changes to the IBIA Asia ExCo for the new term starting from April. Douglas Raitt of Lloydâ&#x20AC;&#x2122;s Register FOBAS, and Richard Ho of Consort Marine have both departed from this group of individuals committed to supporting IBIAâ&#x20AC;&#x2122;s work in Singapore. Douglas decided to go because his scope of work has expanded and he would not be able to contribute as much time and effort to supporting IBIA as he would like to. Richard Ho, meanwhile, has left Consort Marine to join ONE as Deputy General Manager of Marine Fuels, and his new employer was not prepared to support his continued involvement with an association. They will be replaced by Junko Mikano of BP Singapore and Daniel Wang of SK Energy for this new term. We would like to thank Douglas and Richard for their contributions and welcome our two new ExCo members. IBIA Asia Gala Dinner The IBIA Asia Annual Dinner was held at the Fullerton Hotel Ball Room in Singapore on April 11, attracting a total of close to 230 guests seated at 22 tables. The first ever IBIA Asia Gala dinner was held in 2010 , and has been a success every year since. We attribute this to the support of a variety of companies and organisations active in our industry and the Maritime and Port Authority of Singapore (MPA).

World Bunkering SUMMER 2019

This is a dinner where all the industry stakeholders gather, meet new friends and catch up with old friends. Our Guest of Honour for the event was Capt. Segar, Assistant Chief Executive (Operations), MPA. Timothy Cosulich, Chairman of the IBIA Asia ExCo, welcomed guests to IBIA Asia Gala Dinner, which has become a key feature during Maritime Week in Singapore. The new ExCo was also presented to the guest during the dinner. IBIA Asia presented a bursary of S$14,000 to students of Marine Studies at Nanyang Technological University during the dinner, a tradition that has been honoured since 2012 using funds raised by past events to help maritime students from less privileged backgrounds.

Training & event participation The IBIA Asia office offers specialised training for the bunker sector in Singapore with MPA-certified courses. We run both a Basic Bunkering Course and an Enhanced Bunkering Course covering the Singapore Standard, SS600 and the Mass Flow Meter technical standard, TR48. Our courses attracted of total of 47 trainees over the course of February, March and the first week of April, which is an encouraging start to the year. Meanwhile, Argus Media has invited IBIA to speak at seminars in Beijing and Shanghai from 6 to 10 May 2019, where I will be speaking on the topic of IMO 2020. We see this as a good opportunity to introduce IBIA to a wider audience in China.

Simon Neo Regional Manager Asia T: (+65) 6472 0916 Email: regionalmanagerasia@ibia.net

IBIA AFRICA istock

SOUTH AFRICA READIES FOR 2020 We are gearing up for our next conference just as the industry is gearing up for major changes, IBIA Africa’s Regional Manager Tahra Sergeant reports

outh Africa has confirmed that it accepts the use of all types of approved exhaust gas cleaning systems (EGCS), also known as scrubbers, in its territorial waters until further notice, including open loop systems. The information was provided in an advisory notice regarding implementation of the IMO’s 2020 global 0.50% sulphur limit issued to shipowners, operators, master mariners and bunker suppliers in March by the South African Maritime Safety Authority (SAMSA). In addition to allowing ships fitted with scrubbers to continue burning highsulphur bunker fuel from 2020, SAMSA confirmed that ships may use a variety of fuels with no more than 0.50% sulphur, including marine gas oil, low-sulphur fuel oil, LNG and marine biofuels. In other news from South Africa, a new license holder for off shore bunkering has been announced. SAMSA has recently awarded an off shore trading license to Colt Marine. There are now three license holders in the Algoa Bay region, namely Aegean (now Minerva), SA Marine and Colt. Currently the three licensed suppliers are servicing up to 40 vessels per month. IBIA Africa recently attended the Bunker Stakeholder meeting hosted in Nqqura by SAMSA. These meetings are held every second month and are attended by the South African bunker industry and supporting industries. World Bunkering SUMMER 2019

It is SAMSA’s objective to promote South Africa’s maritime industry, with a goal of making South Africa a world maritime centre by 2020. At the time of writing, IBIA Africa is looking forward to hosting our next conference at the Royal Cape Yacht Club in Cape Town, 28 - 30 May 2019. This will be our 4th Regional Conference in Africa, bringing together the region’s bunker industry and creating a platform for networking, engagement with regulators, and shared learning. We will present the decisions from the 74th meeting of the IMO’s Marine Environment Protection Committee meeting held in mid-May, the final MEPC before 2020. Our Director, Unni Einemo will share the latest update on the legislation and guidelines from the IMO and the requirements of industry as we enter the new low sulphur era. A post-conference report will be made available online.

We would like to take this opportunity to thank our valuable sponsor: African Marine Solutions (AMSOL), a specialist provider of safe and sustainable marine solutions to clients in the region, including management fuel transfers between ships in port and offshore.

Tahra Sergeant Regional Manager: Africa T +27 412 1593 SA Mobile +27 (0)79 990 7544 E tahra.sergeant@ibia.net S sergeant.tahra W ibia.net

Tahra Sergeant, IBIA; Nomkhitha Mbele, Subtech; Nozitho Radebe, Spill Tech and Siyamthanda Maya, South African Marine Fuels (SAMF)

IBIA CODE OF ETHICS IBIA is appealing to all of its members to join this important initiative by showing support for our Code of Ethics. It’s an aspirational statement and an important step towards our aim of promoting the adoption of a common set of ethical values across the industry. We believe that when the entire industry acts with the highest ethical standards that this will be to the benefit of us all.

FAIR BUSINESS • We conduct our business in a fair and transparent manner • We will always act in the best interest of each business partner and are honest with the stakeholders involved in our business • We only engage in business using compliant products, and deliver the quality and quantity agreed with our business partners • We always act in good faith

BEST PRACTICE • • • • •

We always act in accordance with applicable legislation, including sanctions We always meet contractual obligations in a timely manner We always do our best to avoid disputes and seek resolution promptly if disputes occur We comply with all applicable competition and anti-corruption laws We respect confidential information and do not unlawfully use any intellectual property

SOCIAL RESPONSIBILITY • • • •

We seek to minimise our environmental impact and the risk of environmental damage We will always ensure employees’ health, safety and security We offer equal opportunities, prohibit unlawful discrimination and respect human rights We offer the same opportunities for professional development to all our employees

TRANSPARENCY • • • •

Our accounts and records are kept accurately and reflect the true state of the company and its operations During audits or investigations, we fully cooperate with the authorities We will not receive or give any gift or entertainment of disproportionate value We are fully committed to preventing both money laundering and terrorist financing

You can sign up to our Code of Ethics online: https://codeofethics.ibia.net/

INTERVIEW

THE ‘KYS’ PRINCIPLE Keld R. Demant is Chief Executive Officer of Bunker Holding A/S, one of the world’s largest bunkering companies. Unni Einemo finds out where he sees the company and industry going

ccording to Keld Demant (KD), the Bunker Holding Group comprises 59 offices in 31 countries, employing around 750 dedicated specialists with local knowledge. They handle nearly 25 million metric tonnes of bunker fuel, generating in excess of $10 billion in revenue. IBIA’s Director, Unni Einemo, had the opportunity to engage the head of the Denmark-based global giant in a Q&A.

UE: Can you tell us how your activity is evolving with regards to the balance between bunker trading physical supply operations? Is your strategy focusing on growth in one area over and above the other? And do you expect growth for your risk management services? KD: We can look back on a 140-year long career in trading, serving shipping clients. Today, I dare say that we are the world leader within our industry - delivering the right product, the ideal financing and the best advice to our clients. Over the years, we have added several supply locations and, with the formation of Bunker One in the beginning of 2018, we now have the perfect platform for increasing our physical services. With 20 ports covering all global regions, Bunker One was very well received by the market and has rapidly developed into a respected physical supplier and consultant. We are pleased to welcome the new clients of Bunker One Physical, and we appreciate the wealth of experience contributed by our new colleagues. Having said that, Bunker One Physical accounts for only 15% of our business, and we stay tuned to an agile business model with no asset investments. As to Global Risk Management (GRM) – the steady growth of this company means that, today, it is one of the leading providers of risk management products within the industry. GRM was the only company qualifying for approval under MIIFID II (new European regulations as of 01.01.2018), and as a result we have seen the business growing at an even faster pace. Looking ahead,

we think that GRM is very well positioned for significant growth.

UE: The demise of OW Bunker in late 2014 created opportunities for other companies, like Bunker Holding, to soak up the market share, employees and other assets left high and dry by the collapse of this global giant. But it also struck fears into the heart of the market about counterparty risk. Do you still see the legacy of OW’s bankruptcy impacting the market today? KD: The bunker industry (like most other industries) has, admittedly, seen a few adverse cases over the years. If you analyse these cases, you can draw two conclusions: First, they all concern a physical supplier, and secondly, there is often an element of potential fraud involved. I believe that our market comprises many healthy players who comply with requirements, but I can only urge bunker buyers worldwide to show due diligence in respect of their counterparts. And this is becoming increasingly important as 2020 approaches.

UE: We are at the start of the 2nd quarter of 2019. Do you have a clear picture now of what types of products your customers want to buy to comply with the 2020 global 0.50% sulphur cap, and when ships without scrubbers will start buying compliant fuels? KD: While no one can claim to know exactly how shipowners will manage the transition to compliant fuels, we believe that, going into 2020, the compliantfuel portfolio may be distributed at the following ratios: • 30% - 40% will transition directly to MGO and wait a few months before the VLSFO concerns are addressed or settled through the supply chain. • 40% - 50% will opt for VLSFO • Leaving about 10% HSFO demand remaining for vessels with scrubbers plus a few being in non-compliance

As to the timing aspect, this will depend on vessel-trade routes and shipowners’ timing with respect to cleaning and – if required – modification of their bunker tanks plus, of course, bunker consumption. Some vessels will need to begin procuring the compliant fuels as early as September/ October to be 100% prepared for compliance with the new sulphur cap taking effect on January 1, 2020. No matter the outcome, we have already seen considerable dialogue and planning for purposes of being well prepared for 2020, and we recommend all involved parties to begin sooner rather than later.

UE: Are you confident the fuels your customers want - whether that is MGO, VLSFO or HSFO for ships with scrubbers - will be readily available throughout the world in 2020? KD: The level of confidence regarding supply availability has recently increased, especially after most oil majors and commodity traders have made announcements regarding their plans to offer VLSFO 0.5%. We therefore expect major bunkering ports around the world to have the three grades available; but, we do, however, expect to meet some supply constraints at niche ports where product availability might be limited to only two or even just one grade. Accordingly, the maximum use of our vast knowledge of the world’s ports and product availability, combined with the preparation and planning ahead by the customers, will be critical to minimise the risk of surprises.

UE: The buying side is extremely worried about the quality of VLSFO blends, in particular with regards to stability and potential ingress of harmful blend components. What can you do to allay those fears? KD: To help our customers navigate safely through this challenge, we (Bunker One Physical) have conducted a series of manual tests concerning VLSFO 0.5% blends, subjecting them to testing by independent laboratories. These blends constitute a fair representation of the types of blends we will likely offer to our customers.

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INTERVIEW

he preliminary test results are quite positive in terms of stability and compatibility. The results tend to be very similar to those we saw when the sulphur cap for ECA changed from 1.0% to 0.1%, which means that we may meet some challenges; however, with proper planning and collaboration between customers and suppliers, most challenges should be manageable.

UE: Bunker fuel costs will inevitably rise in 2020 (unless crude oil prices crash like they did just before the 0.10% sulphur limit in ECAs took effect in 2015). This means the market will need greater access to credit than today to maintain current bunkering volumes. Is that credit going to be available?

UE: The other major concern for ship operators is the increased risk of various VLSFO blends being incompatible. Suppliers are not guaranteeing compatibility today and it seems unlikely they will do so going forward but is there any further information the supply side can provide about products supplied to help ship operators assess that risk?

KD: I truly believe that the lack of credit in the market will pose a much greater risk than the product availability issue.

KD: It is important to mention that, today, a considerable share of the HSFO fuels available are blended fuels. As you mention, there is no guarantee on the compatibility today, but on the other hand, we aren’t faced with many compatibility issues or claims, either. However, we can’t ignore the fact that there will be several varieties of the VLSFO 0.5% blends, and we need to help our customers deal with this challenge. In addition to the VLSFO 0.5% blends and testing already conducted, we have therefore prepared a couple of reference guides. We plan to make these available to our customers to assist them in the transition and help them identify the DNA of the VLSFO blends. This way, they will be better equipped to deal with the fuel on board the vessel.

Just image the combination of the following scenarios: åseveral å significant credit providers have left the market åprices å going up 30 – 40% åthe å buyers are under pressure åbanks å are more tight-fisted than ever åcredit å insurers also have their limits That said, I am pleased to report that we are prepared, as we have secured a 65% increase in our bank package that is still on a non-pledge basis. We will be ready and well positioned to assist our clients.

UE: What impact do you expect IMO 2020 will have on the bunker market? KD: We have implemented a new acronym, “KYS” (Know Your Supplier), which means that the relationship between suppliers and customers will change. It will no longer solely be a “pricerelated” relationship – but rather a closer cooperation around the additional valueadding services that suppliers can bring to the table, including:

• guidance and services around the ability to expand credit lines to match the expected increase on bunker prices • guidance and information on product quality and specifications, plus • technical support during the transition to the new sulphur cap. Therefore “KYS “ capabilities will be crucial, and we consider this to be one of the most significant changes within the bunker market on the back of IMO 2020.

UE: How long do you think it will take for the industry to adapt to the 0.50% sulphur limit and any disruption caused by it to settle down? KD: Based on similar past disruptive effects on fuel markets, we assume a period of 18 to 36 months, depending on how the anticipated challenges represented by VLSFO 0.5% blends get mitigated or addressed. Also, if the number of vessels fitted with scrubbers increases dramatically within the first 2 years, we are likely to return to a balanced and well-supplied market sooner than expected.

UE: Finally, as the head of a leading global bunker fuel and service provider, what advise do you have for IBIA? KD: Make sure that the entire value chain understands that we are in this together. There is no room for “us and them”. We all need to understand and accept that the good old days are never to return. Embrace the new mantra of partnership – Know Your Supplier – and plan your activities accordingly.

One of the reference documents will enable our customers to categorise 0.5% fuels by listing the typical characteristics of Naphthenic vs Paraffinic vs Straight Run fuels. We believe this will be of great value to our customers and help them assess whether the new VLSFO fuels they are to receive, will be compatible with what they have been burning on board prior to the new supply of bunkers.

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NEWS World Fuel Services is expanding in Gibraltar

DRONE ‘SNIFFS’ SULPHUR EMISSIONS A large drone has started start checking emissions from ships in Danish waters to make sure they comply with the 0.10% sulphur limit that applies in the area

he drone is provided by the European Maritime Safety Agency, and is to be used as a means of preventing ship pollution. The drone is fitted with a so-called ‘sniffer’ capable of measuring sulphur emissions. By entering the ship’s exhaust gas plume, the drone can estimate the amount of sulphur in the fuel. The data is immediately available to Danish authorities, who can follow up if the data indicates that a ship does not comply with the requirements. According to a statement the project “will contribute to a more efficient enforcement of the sulphur rules, thereby ensuring fair competition for shipping companies and less pollution from ships”. In Denmark, the Danish Environmental Protection Agency is responsible for enforcing the sulphur rules, and the Danish Maritime Authority supports this work through ship inspections in Danish ports and now also with drone monitoring. The drone operates in an area north of the Great Belt and carried out its first sulphur monitoring mission in the area in April.

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World Fuel Services increases bunker capacity at Gibraltar US-based World Fuel Services (WFS), through its fully owned subsidiary Gib Oil Limited, has extended its capacity in the port of Gibraltar with the addition of two barges to its physical bunker operations. The barges, which according to WFS are dedicated to marine gasoil and ultra low sulphur diesel, also offer the option for multiple product segregation. A WFS statement said: “This new operational setup with the modern and SIRE inspected barges, allows WFS to provide for a vast range of supply options for all vessel types, supplying up to 15,000 tonnes in one single barge trip. This addition to the WFS portfolio presents further operational flexibility to its ex-pipe facility located at Gibraltar’s Western Arm jetty.” Mike Ranger, Senior Vice President, Asia/ EMEA, Marine, said; “With this new offering WFS continues to deliver the highest standard of service to our customers and expand our offering by providing new services in ports where World Fuel Services can deliver the highest value, especially as we head into 2020.” Genoil results witnessed by LR Clean technology engineering company Genoil says that Lloyd’s Register’s – Fuel Oil Bunker Analysis and Advisory Service

(FOBAS) has witnessed the outcome of a demonstration of its Hydroconversion Upgrader. The desulphurisation process was stated to reduce the sulphur content of a high sulphur heavy fuel oil (HSFO) from 1.72% sulphur content to 0.38%, which is compliant with the impending IMO 0.50% marine fuel sulphur limit. FOBAS product manager Muhammad Usman said: ”Although LR did not have full visibility of the technical approach used by Genoil’s process or demonstration and was not present throughout, the sample analysed from the output sample of the demonstration was 0.38% m/m, in comparison to the feedstock used for the process which was stated to be an ISO-F-RMG380 fuel with sulphur content of 1.7% m/m.” David Lifschultz, CEO of Genoil, added: “Gaining independent verification from a renowned shipping classification society of the product characteristics of the supplied sample at entry to the GHU process and the end product at completion of the process is a significant step for Genoil in proving to the industry that there is a less expensive means of ensuing compliance with 2020 regulations that doesn’t require paying a large premium for distillate fuels, or investing millions of dollars of capital, which may never see full payback,

NEWS

n scrubber technology or LNG. And because the GHU produces fuel with the same properties of heavy fuel oil minus the sulphur content, it also reduces the risk of engine damage, which so many in the industry are concerned with in relation to new hybrid distillate products.” Genoil says it conducted a successful demonstration run of the upgrader in October and November last year for Petroleos Mexicanos (PEMEX) at Genoil’s demonstration facility hosted by the UFA Scientific Research Institute of Petroleum Refining and Petrochemistry located in Bashkortostan. Low carbon shipping group expands The Panama Canal Authority and A.P. Moller – Maersk are the latest organisations to join the IMO-supported Global Industry Alliance to Support Low Carbon Shipping (GIA). The GIA now has 18 members, including leading shipowners and operators, classification societies, engine and technology builders and suppliers, big data providers, oil companies and ports. The new members signed up to the GIA during the fifth meeting of the GIA Taskforce at IMO Headquarters in London, UK, in March.

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The GIA Taskforce meeting worked on several projects, including on the validation of performance of Energy Efficiency Technologies, the assessment of barriers to the uptake of Just-inTime Operation of ships and resulting emission saving opportunities from its effective implementation, as well as work on the current status and application of alternative fuels in the maritime sector and barriers to their uptake. The Taskforce was also shown a preview of an open access E-Learning course on the Energy Efficient Operation of Ships, which is expected to be completed and launched later this year. The Taskforce also formalised the extension of the GIA until 31 December 2019 and agreed to develop a White Paper outlining a vision and potential priority areas for the GIA. The GIA is a public-private partnership initiative of the IMO, under the framework of the GEF-UNDP-IMO Global Maritime Energy Efficiency Partnerships (GloMEEP) Project that aims to bring together maritime industry leaders to support an energy efficient and low carbon maritime transport system.

New research institute for alternative energy A new institute based in Japan will link together ship and marine related research projects with research locations. According to a statement the Eco Marine Power (EMP) Research Institute will co-ordinate research project and research locations so that knowledge and resources can be shared. The institute will also conduct research with other companies working with renewable energy and green shipping related technologies. Companies currently associated with the EMP Research Institute include The Furukawa Battery Company, Teramoto Iron Works & KEI System. Topics and research areas to be investigated by the institute include: • Study of ship and marine solar power systems including photovoltaic (PV) panel technologies. • Airflow around ships and marine structures. • Ship-based automation, control and monitoring systems. • Autonomous and unmanned vessels. • Energy storage technologies including fuel cells.

NEWS

tarting from mid-2019 EMP will begin working with additional companies within the framework of the EMP Research Institute. In addition, EMP will work with its strategic partners to expand R&D activities at the Onomichi Marine Tech Test Center (MTTC) and on-board ships. Activities related to the Aquarius Eco Ship and Aquarius Unmanned Surface Vessel (USV) projects will also be co-ordinated by the EMP Research Institute. Salvors recover less fuel oil Members of the International Salvage Union (ISU) provided 224 services to vessels carrying 3,213,228 tonnes of potentially polluting cargo and fuel during operations in 2018, demonstrating the importance of ISU members’ role in protecting the marine environment. Bunker fuel, at 111,796 tonnes in 2018, was down from 135,995 tonnes the previous year. However the ISU pointed out that a number of services noted within the total did not record the quantity of bunkers on the vessel or the cargo type.

targets, ABS established its Global Sustainability Center to coordinate initiatives that advance innovation and technology development focused on safety, practicality and the commercial viability of proposed solutions.” The centre is led by Gurinder Singh, ABS Director of Global Sustainability, and includes a team of professionals with diverse backgrounds and expertise, supported by the worldwide ABS organisation. “Today’s world is quickly changing, and the shipping industry is navigating a complex regulatory landscape and rapid technology changes.

The IMO greenhouse gas reduction targets will present an unprecedented challenge to the industry—as the targets cannot be achieved with today’s technology. The centre has a vital role to play in helping the industry manage the transition safely,” said Singh. “Singapore is an ideal location for the Center as we build upon our strong collaboration with leading universities and sustainability centres of excellence here. The Center is a home for innovation and creativity that brings together industry and academia working hand-in-hand toward a sustainable future.” The centre plans also include leading an industry education program, seminars and lectures, designed to raise awareness of maritime sustainability technologies and carbon reduction strategies.

Reacting to the results of the survey, ISU president Charo Coll said: “ISU wants to make sure that it promotes the full benefits that the salvage industry provides. Of course we aim to save life, to save property and mitigate loss but our members’ operations also protect the environment from great harm.”

ABS launches Global Sustainability Center US-based classification society ABS has established a new research and certification centre in Singapore to help maritime transition to a sustainable, lower emissions industry. “Decarbonising shipping is a challenge that will compel the industry to reach new technology frontiers. At the same time, it is an opportunity to transition to a more sustainable world economy enabled by efficient, low-carbon transportation,” said ABS Chairman, President and CEO Christopher J. Wiernicki. “To facilitate the journey toward decarbonisation

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The Danish Maritime Authority has added this drone to its enforcement armoury

ENVIRONMENT

IMO’S 2020 VISION IMO guidelines for 2020 will be finalised at MEPC 74, after which it is up to industry and relevant authorities to follow the advice, says IBIA’s Unni Einemo

s this issue of World Bunkering goes to press, the groundwork has been laid for the 74th session of the IMO’s Marine Environment Protection Committee (MEPC 74) to complete a comprehensive package of guidelines to assist industry and Administrations to effectively and uniformly implement the 0.50% sulphur limit that takes effect globally from 1 January, 2020. There are some challenging unresolved issues remaining for MEPC to decide on, but we have a pretty good idea of what is coming following deliberations in February at the IMO’s Sub-Committee on Pollution Prevention and Response (PPR 6). Let’s look at what we can expect. Consistent implementation guidelines

a section on handling various types of compliant fuels, and a list of fuel quality parameters that have been identified as a potential cause for concern. These include stability, compatibility, cold flow properties, acid number, flash point, ignition and combustion quality, cat fines, low viscosity, and unusual components. There is an appendix that sets out more information on each of these.

A big part of the IMO’s 2020 package are the Guidelines on consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI. These guidelines include preparatory elements which were already finalised at MEPC 73 in October last year; namely the Ship implementation plan (SIP) along with an appendix on tank cleaning (based on a submission from IBIA), and an appendix addressing the impact on machinery systems with advice on how to prepare for use of a variety of fuels (which IBIA also contributed to). Planning for, and even the execution of, these preparatory steps should be well underway by now.

FONARs, loopholes and left-overs PPR 6 agreed on a standard Fuel Oil Non-Availability Report (FONAR) format for situations where, despite best efforts, the ship could not obtain compliant fuel oil. The FONAR requires a ship to provide detailed documentation to prove why it has, knowingly, taken onboard fuel oil exceeding the relevant MARPOL Annex VI sulphur limits (0.10% or 0.50%). The ship must document that it has made every effort to obtain compliant fuel oil.

There’s more advice coming, including definitions to help to clarify the language to describe various types of fuels,

Apart from the practical advice for ship operators to help them operate safely with various types of fuel, there is a huge body of guidelines relating to various aspects of enforcement, and how to deal with non-availability.

It can also claim that operational constraints and concerns about the quality of the compliant fuel oil available caused it to take an alternative, noncompliant fuel. This quality clause has been called a “loophole” by some,

however, it is important to note that any such concerns would have to be thoroughly documented and a ship would also be expected to specify steps to resolve its operational constraints. In fact, looking at the wording in the FONAR, it is difficult to imagine a scenario when a ship might be able to defend using a non-compliant high sulphur fuel oil in lieu of a compliant marine distillate or fuel oil blend due to operational constraints, unless it can convincingly document that the available compliant fuel(s) would be unsafe to use. Moreover, the idea that a FONAR is some kind of “get out of jail free” card is misconceived. It is a mechanism for the ship to self-report non-compliance. Port State control (PSC) is expected to take a FONAR into account as a mitigating circumstance and may refrain from penalising the ship; however, the ship will still have a deficiency as it is still non-compliant. Guidelines have also been developed for how FONARs should be investigated by authorities, but PPR 6 could not find a resolution regarding how to deal with any bunkers exceeding the 0.50% sulphur limit remaining on board a ship once the carriage ban takes effect. Many member states insist it must be debunkered at the first port of call; however in reality this may not always be possible. IBIA has cosponsored a proposal by Australia calling for a pragmatic approach during 2020.

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Another area MEPC 74 needs to clarify is how to deal with the situation where a ship has a bunker delivery note (BDN) that says the fuel is compliant, but the ship’s own test programme results suggest it is not. This is not covered by the FONAR because the ship thought it had procured compliant fuel oil, but now has an indication it may not be. At present, such cases are typically recorded as a ‘note of protest’ from the ship against the supplier and such NOPs are frequently reported by the ship’s flag state to the relevant GISIS module. Enforcement & controls on ships There are three parts to the IMO’s framework being prepared to ensure ships comply with the 2020 sulphur limit: draft amendments to the regulation itself (MARPOL Annex VI), the draft Guidelines on consistent implementation of the 0.50% sulphur limit under MARPOL Annex VI, and draft 2019 Guidelines for port State control under MARPOL Annex VI, updating the 2009 guidelines.

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All these drafts are due to be approved at MEPC 74, which would complete the non-mandatory guidelines, while the draft regulatory amendments need to be formally adopted at the next MEPC and hence are not expected to enter into force until mid-2021. The amendments to MARPOL Annex VI include a new requirement for ships to have sampling point(s) fitted or designated for the purpose of taking representative sample(s) of the fuel oil being used on board (in-use samples), unless the ship has a low-flashpoint fuel system. All new ships must have them, while they will be phased in for existing ships linked to their first renewal survey after entry into force of the regulation. Appendix VI, which describes how to verify fuel oil sulphur content and currently applies only to the MARPOL sample taken during delivery ship, will be amended to also cover in-use samples and so-called onboard samples. The latter refers to fuel oil intended to be used or carried for use on board ship, and is intended to facilitate control of the carriage ban set to take effect on 1 March, 2020, which prohibits ships (unless they have approved abatement technology) from carrying any fuel oil exceeding 0.50% sulphur in their fuel tanks.

Moreover, it specifies that while the verification procedure for MARPOL delivered samples should be in accordance with appendix VI of MARPOL Annex VI, for other samples taken on board the ship, the in-use and onboard sample, the sample should be deemed to meet the requirements provided the test result from the laboratory does not exceed the specification limit +0.59R, also known as the 95% confidence limit. IBIA has campaigned at the IMO for both of these aspects to be included to ensure consistency in how ships are treated. We also want to ensure that in-use and onboard ship samples are not treated in accordance with the current appendix VI, which does not fully recognize the 95% confidence margin principle and hence carries a risk that a fuel that is actually compliant is deemed non-compliant due to inherent variations in test precision. If a non-compliance is established, the guidelines advice that the port State may prevent the ship from sailing until it takes any suitable measures to achieve compliance. In addition, it calls for the port State to report the relevant non-compliance information to the ship’s flag Administration, the authorities where non-compliant fuel was supplied, and for deficiencies to be report to the MARPOL Annex VI GISIS module.

The consistent implementation guidelines, meanwhile, provide details on how administrations should undertake ship inspections, including when to target ships for closer inspection based on document checks or results from remote sensing or portable devices indicating a breach of sulphur limits. Importantly, the guidelines include a paragraph saying that final analysis should be carried out in accordance with ISO 8754: 2003 by a laboratory that is accredited for the purpose of conducting the test in accordance with ISO/IEC 17025 or an equivalent standard, and that test results should reported in accordance with ISO 8754 protocol, meaning a tested value at or above 0.10% sulphur should be reported with no more than two decimal places.

ENVIRONMENT

f a ship has non-compliant fuel left over after a FONAR situation, we propose that if remaining non-compliant fuel oil cannot be debunkered at the ship’s next available en route port, the relevant administrations (flag and port State) may allow the ship to use it on the high seas while en route. This would only be as a last resort, and only be applicable for the first 6 to 12 months of the global cap as a contingency measure during a period when we may not have full global availability of compliant fuels. We anticipate headwinds for this proposal, but IBIA believes there are plenty of deterrents to prevent ships from using this as a loophole, such as the fact it still has a deficiency and faces both administrative and practical burdens as a result of lifting non-compliant fuel, including the prospect of extra tank cleaning to flush out leftover non-compliant fuel. Work also remains with regards to how to reflect FONARs on the IMO’s Global Integrated Shipping Information System (GISIS), where improvements can be made, including efforts to verify the information submitted.

ENVIRONMENT

key part of the framework is the draft 2019 Guidelines for port State control under MARPOL Annex VI, updating the 2009 guidelines. As the title suggests, these provide a full set of details for initial ship inspections, grounds for closer inspections, and detainable deficiencies. There are some concerns here, including scenarios described above regarding how to deal with non-compliant fuel oil remaining onboard a ship after using a FONAR, and the situation when a ship has BDN that says the fuel is compliant, but the shipâ&#x20AC;&#x2122;s own test results suggest it is not. IBIA is also concerned about the PSC guidelines indicating that all sample analysis should be done in accordance with appendix VI of MARPOL Annex VI.

That will contravene the 95% confidence principle agreed for in-use and onboard samples in the guidelines for consistent implementation until amendments to appendix VI covering such samples enter into force in mid-2021. Scrubber guidelines A full review of the 2015 Guidelines on Exhaust Gas Cleaning Systems (EGCS) needs more time, however, elements relating to malfunction of the EGCS system or a monitoring instrument have been sent for approval by MEPC 74 in May. The message is quite simple: if the ship is unable to fix the malfunction or accidental breakdown within an hour, it should switch to compliant fuel. If the ship doesnâ&#x20AC;&#x2122;t have sufficient compliant fuel onboard to cover the system downtime and has to use high sulphur fuel, it will go on record as a non-compliance.

MEPC 74 will also discuss proposals about how to assess and address the potential environmental impact of scrubber discharges to water, which is not expected to be quite so simple. More control of bunker suppliers Measures to improve control of the quality of fuel oil provided by bunker suppliers has been discussed at the IMO for years, and now there are some instructions for member States on what can be done as part of IMO guidelines to encourage consistent implementation of the 0.50% sulphur limit. First of all, designated authorities should take samples and test fuel oils from bunker barges or shore bunker terminals, but avoiding unduly delaying the operation, movement or departure of ships.

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here is no specific requirement for how frequent such sampling should take place; that is left to the discretion of relevant authorities. Secondly, authorities should take appropriate corrective measures against bunker suppliers found to have issued incorrect BDNs and/or non-compliant fuels. Confirmed non-compliance should be reported to the MARPOL Annex VI GISIS module. PPR 6 also developed a joint MSCMEPC circular addressing the delivery of compliant fuel oil by suppliers, for approval at MEPC 74 in May and at the Maritime Safety Committee (MSC 101) in June. The draft circular is aimed at Members States to take appropriate action against suppliers under their jurisdiction to ensure they deliver compliant fuel oil. They are also told to urge fuel oil suppliers to take into account Guidance developed by the IMO on best practice for fuel oil suppliers and fuel oil purchasers/ users for assuring the quality of fuel oil delivered to and used ships. A group of shipping organisations have submitted a proposal for a bunker supplier licencing scheme for discussion at MEPC 74. IBIA is in principle supportive of licensing schemes as it helps promote a level playing field for suppliers that adhere to best practices. However, for a supplier licencing scheme to be made mandatory by the IMO, it would need to be limited in scope to issues pertaining to IMO regulations in order not to go beyond the scope of member states’ obligations. This may include measures to ensure suppliers to adhere to MARPOL Annex VI requirements regarding fuel quality (Regulation 14 and 18.3) and SOLAS, and that they provide the correct documentation and representative samples as required by IMO regulations. Success up to industry and member states IMO has worked relentlessly to address the concerns surrounding the 2020 sulphur limit by offering guidance on every aspect it possibly can,

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from helping ships prepare to deal safely with compliant fuels and ensuring that control mechanisms are in place to deter non-compliance which would counteract a level playing field. Now, it is up to industry and member States to make it happen. Only Annex VI signatory countries, numbering 93 at the time of writing, covering close to 97% of global tonnage and about half of all the world’s coastal states, can enforce the regulations. Only around 30 countries have experience in sulphur limit enforcement so far, namely those with emission control areas (ECAs) designated by the IMO or locally/regionally/nationally designated sulphur limits. For the rest of the world,

it remains to be seen how they will enforce, though some, like Singapore, are already sending signals that they will take a firm stance. The success of the 2020 sulphur regulation rests primarily with the industry. The supply side needs to bring compliant, fit for purpose products to the market before then end of 2019 and operators need to clean out their fuel systems and buy compliant fuels before the end of 2019 in order to be compliant on 1 January, 2020. IBIA, along with other industry bodies, is working hard to provide the information and support the industry needs to succeed.

BUNKERING BY TRUCK OR BY BARGE IN ALL FRENCH PORTS A team where every member is committed to creating with you the best opportunity of supply, to anticipate and understand your needs. That’s why the human factor and the quality of our sales relationships are so important to us. We can supply MGO in all ports in Channel, from Dunkerque to Brest; from Le Havre & Rouen area by truck or barge. All the ports in Atlantic coast such as La pallice or Bassens. We are also to deliver in the Mediterranean coast ports like Marseille, Fos Nice or Sète.

FOR ALL YOUR ENQUIRIES OR QUESTIONS bunkers@oil-atlantic.energy Head office 83, Boulevard Berthier 75017 PARIS – France +33 (0)1 42 56 13 77

Bunkers office 15, rue Auguste Girard 13300 Salon de Provence France +33 (0) 4 69 96 06 96

ENVIRONMENT

But security concerns still overshadow West African market, as John Rickards reports

xpansion of the Suez Canal has offered opportunities to bunker outfits able to take advantage of them, and it’s perhaps no surprise that Monjasa has added to its African bunker coverage with the launch of operations in Djibouti. The company expects to see 200,000 tonnes per year in sales through the region, with the objective to “challenge the status quo and provide a valid alternative to the traditional Suez and Jeddah bunker markets,” as the company puts it. “Strategically located at the mouth of the Red Sea, Djibouti is fast developing into an attractive bunker destination on the busy Suez waterway. Improved maritime infrastructure and heavy investments in port developments are expected to further advance trade going in and out of Northeast Africa in the future,” Monjasa said in a statement, citing the company’s business model of growing niche markets as alternatives to major existing hub ports. “As the security situation in the Gulf of Aden is improving, new opportunities arise for both service companies and global shippers operating in the area,” said group COO Svend Mølholt. “Having joined forces with a local partner, we are determined to demonstrate Djibouti as a competitive and high-quality refuelling option on this important sea route.” The bunker operation in Djibouti is fully operational and offers all fuel grades according to ISO 8217:2010 specifications. Monjasa is importing its fuel on a 40,000 dwt handysize, the Karen Maersk, which also serves as floating storage for the operation. As part of launching its northeast African operations, Monjasa has also signed with trade finance bank UBAF as regional banking partner.

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Monjasa’s Rasmus Knudsen said, “With Crédit Agricole as its main shareholder, UBAF holds a high global credit rating. Coupled with its 45 years of experience financing businesses in the Middle East and Africa region, we see a lot of synergies in this new partnership.” Southern promise At the other end of the continent, South Africa’s position and high vessel volumes should make it an ideal bunker hub, but the country’s suppliers have been hurt by historically high port charges that make bunkers-only calls less attractive to ship operators and the reluctance of the country’s ports authority to adjust its fee structures has meant that the South African bunker industry is more challenging than it might be - something the government is keen to change. That hasn’t stopped a new player entering the scene, though. Linsen Nambi Bunker Services officially launched late last year and is the first 100% black-owned shipowner in South Africa. Run by a pair of 33-year-old entrepreneurs, Linsen Nambi and WOESA (Women in Oil and Energy SA) purchased Unicorn Bunker Services from Grindrod for an undisclosed fee, including its threestrong bunker tanker fleet operating in Durban and Cape Town. At the launch of the company, South Africa’s Deputy Director General of Transport, Dumisani Ntuli, said that he believes that South Africa has the potential to grow to a place where this industry contributes to “economic growth and offers opportunities for job creation”, and cited the launch as an example of the country’s Comprehensive Maritime Transport Policy (CMTP) agenda to “transform and inclusively grow a maritime transport economy that leverages South Africa’s competitive advantage, supported by the people and innovative infrastructure and service excellence”.

Linsen Nambi co-owner Durand Naidoo said: “It is heartening to know that there are government development plans to unlock more deals like ours” and added that he would like to see “the private sector opening up this space to new entrants, something that will facilitate the creation of employment.” Thuso Mhlambi said the company is proud of its transformation successes: seven out of its twelve masters are black, as are all twelve chief officers and all twelve chief engineers in the company. Western challenges One of Africa’s other major shipping centres, Nigeria, is enduring a more challenging period, however, with a surge in piracy in the Gulf of Guinea and ongoing problems with port congestion in Lagos causing headaches for operators in the West African region. Security has been an issue to one degree or another for years, not helped by the sometimes chequered history of oil exploration and exploitation, and the effect it’s had on local populations. There has been a spate of incidents in the run up to the magazine going to press where tankers and offshore support vessels have been attacked by groups of armed men in the sea south of the Niger delta, in some cases seeing their ships raked with gunfire. I In early March there was an attack on an OSV and a naval escort security boat that culminated in one Nigerian Navy guard being killed and five members of the OSV crew kidnapped. The Nigerian government has continued to refuse ships to carry private armed security personnel; instead, policy is to provide response using Navy personnel on private vessels contracted locally by the government as escorts.

AFRICA

NEW OPPORTUNITIES BECKON

AFRICA

ccording to local press reports, shipping interests working the affected waters have complained that the approach is costly and the security provided is unreliable compared to private options that have proved successful in other parts of the world, as the standard of escorts and their capabilities can vary widely. Speaking in March at the inauguration of the third naval warfare course at the Naval War College in Calabar, chief of defence staff General Abayomi Olonisakin said: “We must think outside the box to be able to tackle security threat in Nigeria. The Naval War College is a veritable platform to help in raising the bar of excellence in security studies. The navy has returned sanity to our maritime space and saved Nigeria billions of dollars. The rate at which piracy, illegal bunkering, terrorism and other maritime crimes has reduced is due to the outside the box thinking exhibited and brought to bear by the navy.”

However, even at that event itself, Cross River State governor Professor Ben Ayade suggested that training in maritime security could be improved as he called on the president to fund the college properly to allow for more practical training in maritime military operations. “I am appealing to President Buhari to make sure that the college is properly funded in a bid to achieve 80% practical during courses by participants,” he said. “The practical element is very essential and important in their training. I also urge you in the preparation of the curriculum to extend the course duration to one year instead of the eight months that is currently being used by the college.”

Ayade went on: “Cross River State provides the best ambience for what the college would be teaching, as the Nigeria Navy is the nerve centre of the country’s maritime space. We import a lot and we need the Navy to keep our waters safe.” The country does indeed import a lot - some 60% of what it consumes - and the result in recent times has been gridlock and serious delays at Lagos port, both shoreside and at sea. These delays, and the surcharges imposed by carriers to cover them and other issues, have bumped up prices in the country, but the ports authority has started taking steps to upgrade and modernise Nigeria’s eastern ports in a bid to make them more viable destinations for international cargo and to reduce in-port crime and graft.

Linsen Nambi now offers bunkering in Cape Town and Durban ©Martyn Smith

World Bunkering SUMMER 2019

AFRICA

ccording to The Nation, an upgrade program at Onne Port home to a sizeable free zone in the heart of the country’s energy fields - last year cost the NPA US$30m, though at the time of going to print it was still awaiting channel dredging to make it accessible to ships with higher draught; an alternative in use at Calabar Port has seen the NPA promote the use of flat-bottom vessels as a means of increasing cargo throughput. The NPA has also begun opening those ports to private sector involvement as a way of boosting upgrade efforts.

Speaking at the handover ceremony for the new private concession to operate one of Warrior Old Port’s terminals to Ocean & Cargo Terminal Services, Bureau of Public Enterprises director-general Alex Okoh said: “The objective is to increase efficiency in our ports, improve service delivery, upgrade and modernise facilities in the ports, reduce the cost of shipping and clearing of goods at the ports and relieve the government of the burden of financing the sector.”

If the country’s trade flows can be eased as a result of this broadening process, operators may come to reap the rewards.

Djibouti is the home of Monjasa’s latest bunkering operation ©Jon Evans

World Bunkering SUMMER 2019

RUSSIA

RUSSIAN MARINE FUEL PRODUCTION AFTER 2020 Sergey Agibalov, senior analyst at Argus Consulting, talks to Olga Bogacheva about the prospects for the quality, availability and prices of marine fuels produced in Russia

ogacheva opens by asking Agibalov: The Russian refineries always produced a large amount of fuel oil, which was in great demand in the whole world. However, the situation has changed and the need for this product is changing. What is happening with fuel oil production in Russia at the moment? Agibalov replies: Traditionally, oil conversion ratio at Russian refineries was low. There are significant capacities for primary oil processing, but secondary processing of crude oil was always low. This is especially true for cracking technology aimed at deep processing of crude.

Sergey Agibalov

Low conversion rate naturally resulted in a large amount of fuel oil. The peak output was recorded in 2014, when Russian refineries produced 78.2 million tons of fuel oil, accounting for 27% of the total volume of processed oil. For comparison – the yield of fuel oil in the US refinery industry is only 2.5%. How did it happen? Several factors played a role here. For a long period of time, due to the special provisions in taxation, namely, application of the socalled “customs subsidy”, even business based on low refining depth was highly profitable, so refineries were in no hurry with modernization. In fact, high margins World Bunkering SUMMER 2019

even stimulated the growth of primary oil refining processing. During 2010 - 2014, the volume of oil refining increased by 40 million tons and reached a record 289 million tonnes. Then, everything changed. In 2015-2016 oil prices dropped and at the same time a new phase of tax reform, the so called Big tax manoeuvre, started in Russia. Together, these two factors led to a sharp drop in the marginality of Russian oil refining. A number of refineries even became loss-making. As a result, the oil companies began to optimize the production of petroleum products, trying to reduce the fuel oil output. A noticeable decrease in the total volume of processing is already visible. The introduction of a number of deep processing projects also brought a positive effect. The capacity of cracking processes increased by 18 million tons in 2015-2018. As a result, the official statistics shows that the production of fuel oil decreased by 41% against the peak of 2014, to 46.4 million tons in 2018. In fact, the reduction was not so pronounced because in recent years the active renaming of fuel oil in various marine, boiler and other heavy fuels became a new trend. With the account of the reclassification, the production of fuel oil and their renamed analogues decreased only by 25%, to 62 million tons. What factors will affect the production of fuel oil in the near future? The key factor is the oil price. If it rises, the volume of processing will increase, and, consequently, the amount of fuel oil on the market will also grow. On the other hand, installation of deep processing plants is in progress. One of

the most anticipated events is the launch of a complex for processing oil residues at the Nizhnekamsk refinery. This unit is designed to process almost 4 million heavy oil products. Its launch will allow the company to cancel production of fuel oil completely. A number of plants for delayed coking are under construction at Omsk, Moscow and Nizhny Novgorod refineries and a number of other places. As soon as these facilities start operations, the output of fuel oil will drop. How will the export of Russian fuel oil change? Traditionally, more than 70% of the total output of fuel oil is exported. The fall in output will lead to an almost equivalent reduction in exports. In 2020, consumption may increase in the domestic market if fuel oil prices drop significantly. But the long-term trend is rather negative and after 2020 domestic demand for fuel oil will gradually decline. Is it likely that Russian refineries will not provide the required amount of low-sulphur fuel for the marine industry after 2020? It’s not an easy question. Market trends will be determined not so much by supply but by demand. Consumers and shipowners have a set of at least four options: • Switch to distillate fuel. This is the most expensive option in terms of operating costs, but it minimizes the risks associated with the testing of new fuels. • Invest in scrubbers and continue to use high-sulphur fuel oil. This is the most attractive option in operational terms, but it requires $1-6 million investment, depending on the size of the vessel. • Use new blends of fuel oil with 0.5% sulphur content. In operational terms, this is an intermediate option between using MGO and HSFO. It does not require any capital investment. But it is

RUSSIA associated with higher operational risks of using new fuels (fuel stability, the possibility of mixing, etc.). â&#x20AC;˘ To evade compliance. It may seem an attractive option until the receipt of fines and subsequent prolonged downtime of the vessel. How much low-sulphur and how much high-sulphur fuel oil will be required for bunkering in 2020 and subsequent years? The future balance of the market is one of the most interesting and unpredictable issues. In the medium term, the market balance will be determined primarily by the prices for fuel oil and distillate fuel. This ratio, in its turn, will affect increasing demand for scrubbers. If we talk about the near future, the market balance in 2020 will certainly be in favour of distillates. High sulphur fuel oil consumption will decline sharply, as only about 2,000 ships will be equipped with scrubbers out of the total size of the commercial fleet of more than 90,000 ships. According to our estimates, the high sulphur fuel oil bunkering will reduce by more than 70%. It will be substituted mainly by MGO bunkering and, to a lesser extent, by marine fuel with sulphur content of 0.5%. You mentioned blended products used for the needs of the shipping industry: what technologies will be available in their production? In 2018 many Russian companies began investigations to find optimal blends for new fuel with a sulphur content of 0.5%.

Since 2015, experience has been gained in the production of fuel that meets the 0.1% sulphur limit in the SECA zone. But high sulphur fuel oil still dominates in the Russian bunkering market. For example, in 2018 Gazpromneft Marine Bunker, one of the leaders in the bunkering industry, sold only 0.2 million tons of marine fuel with sulphur content below 0.1% or 7% of the total sales. In 2020, the bunker market will offer a whole a set of new fuel blends meeting IMO sulphur requirements made of various components. All manufacturers will try to design optimal compositions, aiming at developing products with attractive cost (lower than MGO), based on the available resources of low-sulphur components (hydrotreated VGO, diesel K5, etc.), and with the maximal possible content of high-sulphur fuel oil and other residues of oil refining. A promising blend with 0.5% sulphur is a mixture based on low-sulphur diesel fuel (class 5 with 10 ppm sulphur), BGO with sulphur content of 0.5% and cracked fuel oil with sulphur content of 3.5%. It is highly likely that this mixture will be widely used in the bunkering market due to two factors. Firstly, its cost is lower than of the average distillate fuel. And secondly, cracked fuel oil, a by-product available at most Russian refineries after 2020, is a component of this mixture. At the specified sulphur content in the initial raw materials, the proportions for a mixture with sulphur content of 0.5% should be 6:3:1. It means that the maximal content of high-sulphur cracked oil added in the blend will be 10%. Since fuel oil can often be less sulphurous (fuel oil with a

sulphur content below 3% is widespread on the market), the actual content of cracked fuel oil may be even higher. Among the other options for blending we should mention mixing of summer diesel fuel (10 ppm) with high sulphur vacuum gas oil (VGO - sulphur content 2%) in a proportion of 75% and 25%, respectively, to produce marine fuel with a sulphur content of 0.5%. The main factor that can play in favour of such a mixture is the excess of cracked oil at Russian refineries. What is your forecast for heavy and light marine fuel prices in 2020? And in the future? Bunkering is the main market for highsulphur fuel oil. The expected substitution with low-sulphur fuel in 2020, according to Argus, will be about 140 million tons. This almost instantaneous change in the market will lead to a sharp decline in the price of high-sulphur fuel oil. Fuel oil will have to compete in price with other fuels for power generation â&#x20AC;&#x201C; natural gas and coal. Thus, the spread between the price of low-sulphur diesel and fuel oil with a sulphur content of 3.5% will grow sharply and exceed $50 per barrel in 2020. In absolute terms, the price of high-sulphur fuel oil in North-Western Europe may drop to $230 per ton. In subsequent years, a significant spread in the cost of high-sulphur fuel oil and distillate fuels will encourage installation of scrubbers on ships. Accordingly, the demand and consumption of highsulphur fuel oil will gradually grow. Accordingly, fuel oil prices will recover. We expect a full recovery of the market by 2024/25.

RUSSIAN NEWS

Russian bunker market in 2018 Recently published figures show that cargo throughput at Russian ports in 2018 increased 4% year-on-year to 816 million tonnes. The number of ship calls, however, fell 5% to about 90,000.

The cargo growth was mainly due to the development of marine terminals in the Arctic basin, where 92.7 million tonnes of cargo were handled. That was 26.4% more than during the same period in 2017. Liquid cargo handling services increased to 62.3 million tonnes, up 41%; dry cargo throughput reached 30.4 million tonnes, up 4.3%.

Cargo throughput in Arctic ports increased strongly. Cargo going through Murmansk increased 18.1% to 60.7 million tonnes while Arkhangelsk handled 2.8 million tonnes, up 15.5%. The Arctic port of Sabetta, where the ocean export terminal for the Yamal LNG project is located, is developing rapidly. In 2018, the cargo turnover here almost doubled and reached 18 million tonnes. World Bunkering SUMMER 2019

Bunker volumes rise Annual figures from the bunker industry reflect the overall trends in Russia’s ports. The total volume of fuel delivered to ships in 2018 amounted to 11.7 million tonnes, up 3.5% from 2017. This total included 9.1 million tonnes (77%) of heavy fuel and 1.9 million tonnes (16.2%) of distillates. Lowsulphur fuel was only sold in the NorthWestern region and comprised just 0.1% of total sales, at 0.7 million tonnes. Bunker volumes by region in 2018: • Far East - 4.7 million tons • Northwest - 4.0 million tons • The Black Sea - 2.4 million tons • Inland waterways - 640 thousand tons. The market leaders remained the same and comprised the bunkering divisions of oil companies, with the five largest players accounting for almost 70% of the market: RN Bunker - 25.5% Gazpromneft Marine Bunker - 15.8% Lukoil Marine Bunker –15.7% NNK-Bunker - 6.2% Transbunker – 4.9% Northwest and Arctic The total fuel sales increased, by 220,000 tonnes to 4 million tonnes. However, the largest bunker port of Russia, St. Petersburg, saw its volumes drop significantly – by 7.5%. PortNews analysts say it was caused by high prices, which in 2018 increased by more than 30%. In certain periods, the spread in prices for MGO in the port of St. Petersburg and Rotterdam was only $4 per tonne. . Large volumes of distillates and lowsulphur fuel are sold in the North-West market. The sales structure differs sharply from the average of Russia: IFO – 62.8%, MGO – 19.7%, ULSFO – 17.5% Black Sea Bunkering volumes in the Black Sea did not change between 2017 and 2018 and amounted to 2.4 million tonnes. Far East In the ports of the Far East the situation World Bunkering SUMMER 2019

also changed little in 2018. Despite the growth of cargo turnover in the region (+5%), only 4.6 million tonnes of fuel were delivered to ships, which is close to the volumes of the previous year. The situation is explained in the same way as in the North-West: prices in the ports of Primorye are almost equal to the prices in nearby Singapore, causing bunkers only calls to almost stop. Against this background, the amount of fuel delivered in the port of Vladivostok increased sharply. In 2018, total volumes were 1.1 million tons, which is about 58% more than 2017. About a third of this volume is sold at the port’s anchorages. Vysotsk LNG plant starts exporting The first batch of liquefied natural gas has been shipped from a new terminal in the port of Vysotsk. In April, a mediumsized LNG plant owned by PJSC NOVOTEK delivered 7,300 tonnes to the Coral Energice, and was shipped to Finland. Earlier, Leonid Mikhelson, the head of NOVOTEK, speaking about the expansion of production in 2020, noted: “The capacity of first line is 600,000 tonnes. Next year we will probably make a decision about two extra lines. So another 1.2 million tons will be offered to the market. Bunkering in the Baltic region is developing rapidly; I think all production will be marketable.” LNG-powered ferry for Ust-Luga – Baltiysk line Nevsky Shipyard has won the contract to construct a ferry for the train-ferry line Ust-Luga – Baltiysk. The contract has been awarded under the terms of a special order by the Russian government. Development of the ferry line through the construction of a new LNG-powered vessel is included in the federal target program for the development of the Kaliningrad region for the period up to 2020. The 200-metre car-rail gas-powered ferry, ice category Arctic4, will be equipped with a double bottom and double sides. LNG bunkering may be performed simultaneously from four tanker trucks through a ship booster module, as well

as from a bunkering vessel and from a coastal LNG bunker base. RN-Bunker bunkered the Boris Sokolov RN-Bunker, a subsidiary of Rosneft, has supplied fuel to the ice class 7 tanker Boris Sokolov which passed through the Eastern part of the Northern Sea route without icebreaker escort for the first time ever. Bunkering was carried out at Murmansk. Boris Sokolov was built in 2018 and was designed to transport gas condensate. The bunkering operation was carried out in conditions of limited visibility and low temperature (-24°C). Gazprom Neft to supply lubricants to Sovcomflot Gazprom Neft – Lubricants has concluded an agreement with Sovcomflot for the supply of marine lubricants. Under the contract, Sovcomflot’s tankers operating in the Arctic will be supplied at the Turkish ports of Samsun and Trabzon. All supplied products have completed tests in extreme conditions of the Arctic and the Far East, where navigation is carried out at temperatures down to -45°C. Monitoring the operating parameters and characteristics of lubricants during use includes testing of working oil samples by independent international laboratories. The results will be available online and contain complete information on changes in the condition of the oils. Ferry from Sochi to Turkey A ferry line is now running services connecting Sochi and two Turkish cities, Samsun and Trabzon. At the beginning of this year, freight ferries began supplies of seasonal fruits and vegetables from Samsun to the resort twice a week. It was planned to re-launch a direct passenger and car ferry line between Sochi and Trabzon in May. Sochi’s tourist board estimates that this new service will boost tourist traffic to Sochi and nearby Russian regions, as well as attract tourists from the Black Sea coasts of Turkey and Georgia.

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Overall the reduction in ship calls was due to larger vessels carrying a growing share of cargo. These included large-capacity gas tankers.

COMPANY NEWS

GAZPROMNEFT MARINE BUNKER a subsidiary of Gazprom Neft, was established in 2007 to provide year-round supplies of marine fuel and oils for sea and river vessels

he company’s share in the Russian bunkering market at the end of 2018 was 16% with total sales of marine fuel reaching more 2.9 million tonnes. Gazpromneft Marine Bunker currently has seven regional offices in Kaliningrad, Arkhangelsk, Murmansk, St. Petersburg, Novorossiysk, Yaroslavl and Azov, – and six subsidiary companies: Gazpromneft Shipping – managing the Company’s own fleet comprised of ten bunkering vessels, four ARC7 class oil tankers transporting oil from Novoportovskoye oilfield and two icebreakers - they are designed to perform operational activities including icebreaking tanker support, mooring and loading operations, vessel towing, fire fighting, and oil-spill response and lifesaving operations; Gazpromneft Marine Bunker Balkan S.A. – bunkering in the Black Sea port of Constanta; AS Baltic Marine Bunker – operating the Baltic Sea port of Tallinn; Gazpromneft Terminal SPb – operating the bunker terminal in St. Petersburg; Novorosnefteservice - storage and transshipment of marine fuel owned by Gazpromneft Marine Bunker on Black Sea; Novorossiysk Petrotransshipment Complex - storage and transshipment of marine fuel in the port of Novorossiysk.

Sakhalin, Novorossiysk, Tuapse, Kavkaz port, Taman, Sochi, St Petersburg, Ust-Luga, Primorsk, Kaliningrad, Baltiysk, Murmansk, Arkhangelsk) as well as river ports (St. Petersburg, Azov, Yaroslavl, Sheksna, Nizhny Novgorod, Cherepovets, Kazan, Samara, Volgograd, Astrakhan, Olya port, Rostov-on-Don, Ust-Kut, Nizhnekamsk, Tomsk, Novosibirsk) and international ports including Tallinn (Estonia), Riga (Lavtia), and Constanta (Romania). Part of Gazpromneft Marine Bunker’s strategy is to create its own terminal network in the major sea and river ports.

Gazpromneft Marine Bunker has more than 200 customers, most of them are international companies. Most of major Russia’s river and marine shipping companies are Gazpromneft Marine Bunker’s customers as well. The Company has an ISO 9001:2015 compliance certificate, issued in December 2018 for the ‘Sale of Petroleum Products in the Bunkering Market’. The certificate confirms high quality of Gazpromneft Marine Bunker’s services.

Gazpromneft Marine Bunker operates in main sea ports of Russia (Nakhodka, Vostochny, Posyet, Zarubino, Kozmino,

World Bunkering SUMMER 2019

INNOVATION PAGE TITLE

GOTHENBURG’S BUNKERING APP Newly developed app aims to make bunkering operations easier and more efficient

weden’s Gothenburg Port Authority has launched a digital solution designed to allow suppliers to notify intended bunkering stems online, rather than by email or phone. The app also shows available loading berths for bunker tankers. In addition it compiles bunkering statistics, facilitating the work of the Swedish Maritime Administration Vessel Traffic Service (VTS) and other organisations at the port. The idea behind the app is to make it simpler for bunker operators to plan and carry out their work effectively. The Port of Gothenburg Energy Port is the largest open access energy port in the Nordic region, handling over 2,500 calls and more than 23 million tonnes of energy products each year. It is also one of the world’s larger bunkering hubs. In January, a test period began with selected users contributing valuable input in the lead-up to the official roll-out at the start of April. The bunkering company Bunker One is one of the participating companies that now uses the app as part of its regular operations. “Overall, I think the app is already working very well, although the coastguard and VTS notification function needs to be more user-friendly. Booking quay space and the quay plan are excellent, giving us better foresight, which in turn helps us in our day-to-day work,” said Karolina Skoglund, bunker operator at Bunker One. World Bunkering SUMMER 2019

The app also helps the port’s security coordinators, who save valuable time by no longer needing to act as intermediaries between the different parties. As the bunker operators administer quay bookings independently, all that is required is process verification. “We are confident that using the app will help boost efficiency and maximise the use of our bunker quays. But we would like to point out that it is not our intention to use the app to replace daily contact with our customers, which will continue to be an important part of our relationship,” said Dan-Erik Andersson, Head of Operations at the Energy Port. Binary cycle system for coal carrier Japanese shipowning group “K” Line is trialling a waste heat recovery system on a newbuilding. The 91,000 dwt coal carrier Corona Youthful was delivered by Oshima Shipbuilding with a binary cycle power generation system developed by Kobe Steel in February 2019 The system is being trialled in order to confirm performance and durability at sea in a joint research project being carried out by Kobe Steel and “K” Line. Binary cycle power generation is a waste heat recovery electric power generation system that uses compression heat from air scavenged from the main engine.

The system reduces fuel consumption by the generator. Design concept for electricpowered tanker Japanese companies Asahi Tanker Co and Exeno-Yamamizu Corporation have jointly developed a domestic shipping tanker design which incorporates ‘zero emissions’ electric propulsion. Classification society ClassNK is providing technical advice on ship design, electric propulsion and on anticipating changes to regulations. Development of the so-called e5 design is underway with a view to replacing all bunker tankers operating in Tokyo Bay. It is intended that that the first e5 vessel will be launched late next year. The project team is also working on an e5 coastal vessel design, which would require longer cruising range. The ships’ core energy source will be electricity from lithium-ion batteries. With reduced emissions, reduced noise and vibration the design is intended to be environmentally friendly. It is also claimed that a simple hull construction and use of automated equipment will reduce crew work load

MIDDLE EAST

Fujairah’s open-loop scrubber ban has caused controversy ©Michael Gaylard

NO SHORTAGE OF WOULD-BE RIVALS FOR FUJAIRAH Open loop scrubber ban at Fujairah causes consternation, as John Rickards reports

he Port of Fujairah threw something of a surprise spanner in the works in January when it announced via a Notice to Mariners that it had decided to ban the use of open-loop scrubbers in its waters, and that ships would have to use compliant fuel once IMO 2020 was in force. The move came largely out of the blue, and follows on the heels of similar bans in Singapore, most Chinese waters, various parts of Europe and a couple of American states, all over concerns about the potential environmental impact of washwater. World Bunkering approached the Port of Fujairah for further clarification regarding the ban - it’s not clear on the face of it when exactly it comes into force, whether there are suitable reception facilities for closed-loop or hybrid systems already available, and so on - but it couldn’t be reached for comment. Industry pro-scrubber pressure groups were quick to react. The Clean Seas Alliance 2020, a shipowner body whose formation was announced only in October and which only completed incorporating three weeks before the announcement, joined Twitter in order to say the group “views the [Fujairah Port] announcement with concern,

and our many members that will be impacted will be interested in understanding the environmental data behind the decision to prohibit open-loop scrubbers” (inevitable hashtags removed for readability). The Exhaust Gas Cleaning Systems Association, representing scrubber manufacturers, was more verbose. Director Don Gregory said: “We are disappointed to learn of the ban by the Port of Fujairah on open-loop scrubber washwater discharge. This is unfortunate at a time when the shipping industry is working hard to reduce sulphur emissions and may well lead to a setback in the progress already made in reducing emissions.” “The International Maritime Organization (IMO) carefully investigated exhaust gas cleaning systems before sanctioning their use to meet the 2020 global 0.5 sulphur cap. We urge other ports and other authorities to research the matter in depth before making hasty decisions inspired by exaggerated claims that may have a very significant,

negative impact on the shipping industry and may also undermine the credibility of the IMO Marine Environment Protection Committee who spent time weighing all the sides of the argument before deciding to include compliance methods such as marine scrubbers in regulation 4 of MARPOL Annex VI.” And they have a point; while CSA 2020 touted a Carnival-led study testing washwater discharges from 53 cruise ships and with results evaluated by DNV that showed water output well within numerous world water quality standards, it’s far from the first. Trials and testing of particular marine environments have been carried out on scrubber systems for ten years or more and have shown much the same. But, equally, ports like Fujairah may have a point too, as some studies have suggested that the use of openloop scrubbers on auxiliary engines and for inert gas production on tankers in port - with typically low mixing rates with the open sea and smaller dilution volumes - could see a gradual long-term build-up of longer-lasting pollutants, particularly metals like lead.

World Bunkering SUMMER 2019

While the debate rumbles on, it does look as though in the long run, open-loop scrubber systems may find their operations confined to international waters, with ships equipped with them merely having to switch fuels as they approach port. Several owners have already come out and said they will do just that, and that this would have little to no effect on scrubber economics. In this respect, Fujairah may be an early adopter rather than an outlier. Happily for operators, Fujairah has also announced that Fujairah Refining has begun manufacturing and production of 0.50% sulphur fuel oil, making it available to any vessels calling at port as of February this year. The Middle East Gulf region isn’t short on would-be rivals for Fujairah’s bunker business should it become a less attractive destination for owners. Oman has spent a few years promoting itself as a potential bunkering hub based on its position at the mouth of the Gulf. While progress has been slow, it has also been relatively steady. The turn of the year saw the port of Duqm sign a bunkering terminal deal with Shell Oman Marketing. The terminal deal should see Shell offering fuels and lubes in varying grades as well as ancillary services to visiting vessels.

MIDDLE EAST

hile that remains a supposition rather than a demonstrated fact, and would do until long-term use by ships at berth proved either way, it’s perhaps understandable that busy ports like Fujairah are taking a precautionary approach.

Port of Duqm draws a clear ambition to become a future bunker hub serving in the entire region taking advantage of its prime location as well as the availability of the right fuel specs and offer prime bunker services accordingly. Being closely located to the major oil and gas and mining projects in Oman, Port of Duqm is seeking to increase its activity level radically in the years to come.” “Port of Duqm is committed to provide an extensive support and service to Shell Oman’s downstream business operation in the Sultanate of Oman and continue to be the most preferred port in the region.” Duqm is also a strategic port that, along with Salalah, has been used as an occasional resupply point for US Navy vessels operating in the Gulf for some time. Those arrangements took on a more concrete form in March when the US and Oman signed a deal, reportedly long in negotiation, giving the US regular access to both ports with tensions over Iran and concerns over the security of US naval operations in the area high on the US Navy’s agenda. The deal will allow the US Navy “to take advantage from the facilities offered at some of the Sultanate’s ports and airports during visits of the US military vessels and aircrafts, particularly in the port of Duqm” according to the state-run Omani News Agency. The port already has a UK Royal Navy support presence on the back of a similar agreement with Britain, and the Omani government has been trying to get a joint investment project with Chinese backing off the ground at Duqm.

Whether military or civilian, boosting the port’s vessel traffic should see a knock-on effect on bunker sales. Across the Gulf, though one assumes probably not eyeing US Navy refuelling contracts, Islamic Republic of Iran Shipping Lines has called on Iran to step up its bunker business as it begins to bunker at a new terminal on Qeshm Island. Before the change in the US political climate and the re-emphasis on sanctions, Iran had been keen on making Qeshm a bunker hub to challenge Fujairah rather than seeing its oil products exported to the UAE for sale. Now, according to the country’s Tasnim news agency, IRISL managing director Mohammad Saeedi has said: “If we establish suitable fueling infrastructure in the country, ships will get cheaper fuel at Iranian bunkering sites instead of doing a 130-mile detour to Fujairah. The government, the ministry of petroleum and the Ports and Maritime Organization of Iran should help develop this lucrative and productive industry. In this regard, we need more cooperation from the ministry of petroleum. Our oil products should not go the UAE and for fuel, Iranian vessels should be supplied by our own storage sites.” A second major bunkering terminal is under construction at Bandar Abbas. Meanwhile Iranian fuel is said to end up on the market elsewhere but Iranian suppliers say their local price per tonne is several dollars cheaper on average than at ports across the Gulf. The success or otherwise of the bunker hub plans may depend on how deeply sanctions over oil exports bite and whether price differences are enough to lure traffic to the Islamic Republic.

“This agreement is a part of Shell Oman’s development plan to expand its operations in major ports in Oman. And with the developments happening at Port of Duqm, Shell Oman decided to further extend its services in the port,” the port said in a statement. “With new global bunker regulations coming into effect as from 2020,

World Bunkering SUMMER 2019

Duqm’s status as a fuelling base for the US Navy has been reinforced ©USN/Preston Paglinawan

EVENT REVIEW

Panel debate at FUJCON 2019 ©Conference Connection

VIEWS FROM THE ‘HOLLYWOOD OF BUNKERS’ IBIA’s Unni Einemo reports on what FUJCON 2019 showed us as the industry prepares for the IMO’s 2020 sulphur limit

early 500 participants from around 35 countries were said to be gathered in Fujairah for the 11th International Fujairah Bunkering and Fuel Oil Forum, FUJCON 2019, from 25 – 27 March, placing it among the world’s top two bunker conferences for the number of attendants. Fujairah also lays claim to being a leading bunkering port by volume, behind only the undisputed global leader Singapore with its nearly 50 million tonnes per year, but there are no official figures to confirm whether it is number two or three compared to Rotterdam’s 8-9 million tonnes sold annually, though it very well might be above that level. Bunkering is of great importance to Fujairah, which was clear by the support from officials. FUJCON 2019 was held under the patronage of H.H. Sheikh Hamad bin Mohammed Al Sharqi, Supreme Council Member and Ruler of Fujairah, who even welcomed all the speakers to a brief audience at his palace. His eldest son, H.H. Sheikh Mohammed bin Hamad bin Mohammed Al Sharqi, Crown Prince of Fujairah, officially opened FUJCON 2019.

Also giving a speech at the opening ceremony, Dr. Mohammed Saeed Al Kindi, Chairman of the FUJCON Steering Committee, spoke about how Fujairah continues to enhance its position as an energy hub and that the emirate is aiming to achieve “complete data transparency by 2021” as part of Fujairah’s journey to become a global energy trading hub with an independent price benchmark. After the opening ceremony, one of the keynote speakers, Mike Muller, Director, Vitol Group, drew an appreciative nod from officials and the audience when he said that “Fujairah is to bunkers what Hollywood is to the movies,” adding that Fujairah is an obvious place for price discovery. Oil product trends Muller of Vitol Group and Dr. Fereidun Fesharaki, Chairman, FGE shared their views on oil and product market trends and the impact we can expect from the 0.50% sulphur cap. Both told us that various factors have caused residual fuel oil prices to go above crude oil and even be on parity with gasoline at present, which is very unusual.

Basically, supply is declining, partially due to refineries upgrading or running lighter, sweeter crude oils at a time when residual fuel oil demand remains strong. So why, then, are we worried about a high sulphur fuel oil (HSFO) surplus in 2020? In short, as ships stop buying HSFO and seasonal demand from power generation to help hot countries stay cool in summer declines, we can expect a big stock build and price crash in Q4. However, according to Fesharaki’s presentation, managing the HSFO surplus caused by the IMO’s 2020 sulphur limit looks like a temporary problem set to last about two years. After that, the market will probably be rebalanced as ships continue installing scrubbers, refiners maximize upgrading, and the remaining HSFO is redirected to the power generation sector. Fujairah prepares for 2020 Vitol is getting ready for 2020 in Fujairah, having restarted the old Fujairah refinery it acquired in 2007, where it has capacity to process around 80,000 barrels per day of crude to produce, among other things, 2020 compliant bunker fuel.

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EVENT REVIEW

n fact, Vitol has made 50,000 tonnes of such product available for supply in Fujairah since February, but had not sold a single stem by late March because the cost is high and nobody needs it yet. It seems, however, that the storage providers and suppliers active in Fujairah are expecting to be ready to provide mainly compliant fuels in 2020, as uptake of scrubbers in the tanker segment – the area’s main bunker buyers – is limited. Moreover, as few will have missed, Fujairah has banned the use of open loop scrubbers within the waters under the port’s jurisdiction. Another important milestone was confirmed during FUJCON, namely that the United Arab Emirates, until recently not a signatory to MARPOL Annex VI, acceded to the regulation in February and expects to be ready to enforce it before the end of Q2. Views on 2020 readiness A series of panel debates focused on various aspects of 2020 readiness, one of which was co-moderated by myself and William Tan, Vice President, Miyabi Industries Pte Ltd. Our panellist included Moain Alzoubi from the Federal Transport Authority, UAE who spoke about enforcement and the role of Port State control, Grant Hunter, Head of Contracts & Clauses, BIMCO, who explained a bit about BIMCO’s suite of 2020 clauses for charter parties, and Ara Barsamian, President, Refinery Automation Institute LLC, who spoke about the main principles of fuel oil blending and some of the key concerns. A further two panels, one chaired by INTERTANKO’s technical director Dragos Rauta and another chaired by Timothy Cosulich, CEO, Fratelli Cosulich, and an IBIA board member since April 1, 2019, discussed these issues further. One of the key concerns remain the 0.50% sulphur fuel oil quality and compatibility, although Eddie Gauci, Global Head, BP Marine, said the company has already been running trials with very low sulphur fuel oil (VLSFO) and has been getting good feedback from the end users.

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Audience at FUJCON 2019 ©Conference Connection

On day two of FUJCON 2019, Dave Ernsberger, Global Head of Energy Pricing & Co-Head of Content, S&P Global Platts, chaired a panel on trading and risk management, during which it became clear that most are anticipating end users to begin buying VLSFO late, which will make the end of 2019 challenging as suppliers strive to get the right product in place at the right time. It was also noted that the current forward price for max 0.50% sulphur VLSFO is low, leading people to ask why buyers aren’t securing supply now. Some traders are said to be buying VLSFO now and putting it into storage on large tankers or shore tanks in anticipation of higher prices later this year. A panel on legal aspects, meanwhile, anticipated an increase in disputes over fuel oil sulphur content and quality in 2020.

There was also a panel on the potential of LNG as a marine fuel, which unsurprisingly concluded that LNG has great potential not just to reduce sulphur, particulate matter and nitrogen oxide emission form ships, but can also play a role in reducing greenhouse gas emissions from the sector. Representatives from scrubber manufacturers were conspicuously absent from FUJCON 2019. That did not stop several of the presenters and panellists from assuming that scrubbers will be part of the solution for ships to meeting the 2020 sulphur emission limits. Doubts have been sown, however, about how long they will play a role as scrutiny increases on scrubber discharges to water and pressure grows on the shipping sector to reduce its use of fossil fuels.

IBIA’s Director Unni Einemo met the Ruler of Fujairah, H.H. Sheikh Hamad bin Mohammed Al Sharqi, at his palace

INDIAN SUBCONTINENT: INDIA, PAKISTAN, SRI LANKA

GP Global has been bolstering its Indian arm

MAKING PROGRESS The bunkering sector throughout the Indian sub-continent shows signs of progress, as John Rickards reports

opes are high for the Indian economy as China’s heads into slowdown or recession. With increased economic throughput comes greater vessel traffic and - assuming there are no hastily-implemented sales taxes seriously affecting costs - more potential for fuel sales to those vessels.

Good news for fuel suppliers, particularly if greater local refining follows demand for products; local availability has always been a consideration for suppliers.

So goes the standard theory, anyway. US-based research and consultancy group Wood Mackenzie appears to support this view. It released a forecast last year predicting that the country would account for a third of world oil demand growth by 2035, overtaking China as it rises by 3.5m barrels per day. At the same time, the country’s refining capacity is expected to only grow by 400,000 bpd by 2023, making increased oil and products imports seemingly unavoidable in the long term unless there’s a major switch to electric infrastructure. Such a switch seems unlikely at present.

Part of the drive for that degree of trade and demand could yet be the long-mooted and barely-touched International North-South Transport Corridor (INSTC). The project, not dissimilar to the China-Pakistan Economic Corridor except that the latter is actually in (expensive) development already, is a multimodal trade route megaproject linking Russia and Mumbai, via Azerbaijan and Iran, first put forward by Vladimir Putin in 2000. It was championed as a priority by the Russian government for a while, given a one-off dry-run to explore the likely choke points and areas needing the most investment a few years ago, and then quietly swept under the rug as Russia’s priorities shifted.

“We think the most likely situation is that India would need between 3.2 million and 4.7 million barrels per day of new capacity out to 2035 to remain self-sufficient in transport fuels. So we are talking about a future capacity which is 1.7 to 2.0 times the current. This is clearly an uphill task, unless domestic refiners can commit to their planned capacity additions,” Wood Mackenzie Research Director Sushant Gupta said.

However, things have begun to move again, particularly at the Indian end of the route. At the start of February, the Indian government (via the state-owned Container Corporation of India) signed an MoU with equally state-owned Russian Railways Logistics (RZD) to accelerate infrastructure development of the corridor and container traffic between the two countries: by rail through to Bandar Abbas, then ship to Mumbai.

“Partnership with Concor opens strategic perspectives for RZD Holding, making it possible for the company to strengthen its positions on Eurasian market of multimodal logistics by developing new joint logistics products for international trade,” CEO of RZD Logistics Viacheslav Valentik said. “Turnover of goods between Russia and India is constantly growing and both countries are interested in developing modern logistics services, operating, in particular, along the North-South ITC – a promising project, which has already turned into one of the most important transport arteries of Eurasia and contributes to further collaboration between our countries.” While some Indian press reports suggest that India will be footing much of the bill, earlier measures in the same vein have seen a fifty-fifty split between Delhi and Moscow. Regardless, the announcement represents a marked increase in interest from the Indian government in the link and in wider cooperation with Russia as the country seeks to assert itself on the geopolitical stage as its economy grows and Chinese projects across southern Asia pick up steam. Russia, in turn, wants to extend economic influence elsewhere, particularly through Caspian region oil and gas exports, as a counter to Western sanctions that China with whom it is setting up a similar East-West corridor - has been unwilling to challenge. World Bunkering SUMMER 2019

Likewise, even without any putative INSTC traffic, Mumbai’s shipping activities are set to grow if the country’s expansion and upgrading of its inland waterway network continues. In February, the Indian Ministry of Shipping made a lot of hay from the first Maersk containers to ship via the Ganga river, National Waterways 1. The first intermodal terminal on the river was opened last November in Varanasi, Uttar Pradesh with the principal aim of allowing shipping of container cargo to Kolkata and has since seen pilot cargo movements by Dabur India, PepsiCo, Emami Agrotech and IFFCO Fertilisers, including some integrating with the National Waterways 2 and Indo-Bangladesh Protocol Route.

Eventually, National Waterways 1 will cover 1,390 km of inland waterways allowing navigation by vessels of between 1,500 and 2,000 dwt. In that respect, the first cargo for a major international container shipper is significant. Given the huge potential reach of the country’s river system and the associated reduction in transportation costs and, in theory and in the long run, carbon emissions, there’s no reason to suppose that the use of the India’s inland waterways won’t prove to be a significant source of vessel movements and see more box transshipment at the route’s Haldia terminus. One bunker supplier increasing its Indian offerings in line with the country’s increasing economic and shipping clout is UAE-based GP Global (formerly Gulf Petrochem). Last autumn, the company expanded its Mumbai office with two new hires in industrial sales and bunker trading. “They bring a wealth of expertise in the bunkering business that will accelerate our growth as a global organisation, helping to add even better value for our customers. The knowledge and skills that the new team members bring is an asset to our company that will enable us to gain significant industry leadership by assuring our customers with strong market insights,” group director Prerit Goel said.

A couple of months before, it inked an exclusive deal with oil major Cepsa to manufacture, market and import Cepsa’s marine and power generation lubricants in India. “India is a huge market for port modernization and coastal shipping development. Major initiatives have been taken in this direction by our government. This partnership is our contribution to the government’s Make in India vision and the vibrancy of the sector is a clear sign of resurgent interest in its potential. Cepsa is a well reputed international brand and will be a good fit for our portfolio,” GP Global’s global head of terminals and Indian country head M Prabakaran said. Cepsa’s Álvaro Díaz Bild said, “This will be the first time our lubricants will be produced outside our plants in Spain, as the facility in Mumbai has been the first approved by us after a rigorous and successful audit process. GP Global complies with our highest standards requirements, occupies a strong position in the Indian maritime industry, and has in-depth know-how of the lubricant and bunkering businesses.” The company’s director of lubes, base oils and paraffin waxes added: “Cepsa marine and power generation lubricants, as well as Cepsa’s broad lubricants portfolio,

Despite refining limitations, Pakistan’s market has been steady ©Hammad Khan

World Bunkering SUMMER 2019

INDIAN SUBCONTINENT: INDIA, PAKISTAN, SRI LANKA

ran certainly seems to be onboard; at the same time as India’s deal with Russia was finalised, the country’s parliament voted to extend cooperation with Russia on its own transport infrastructure linking Enzeli on the shores of the Caspian with Bandar Abbas in the south. India is becoming a growing economic powerhouse, and primary international transshipment point, at the INSTC’s southern terminus. If - and it remains a reasonably sizeable if for now - there is real movement on shipping Russian trade through Mumbai, the port’s bunker suppliers could be in for a major boost.

INDIAN SUBCONTINENT: INDIA, PAKISTAN, SRI LANKA

are currently exported from Spain to different countries. The partnership with GP Global will provide the necessary framework to enter into the Indian market as the company has great experience in the marine market, especially in bunkering.” GP Global said that the deal would strengthen its in-house R&D facilities and help it develop technologically advanced products in India. The company is manufacturing products through a contract with its group company GP Petroleums Limited at their plant at Vasai, Mumbai, which was already engaged in blending automotive and industrial lubricants. The plant is certified with ISO 9001, ISO 14000 and OHSAS 18001. India has also been taking significant steps to smooth shipping trade between India and Bangladesh as well as to ease congestion on the country’s road and rail network, by reducing the bureaucratic overhead involved and removing or reducing some of the rules restricting Indian-flagged ship calls at Bangladeshi and Sri Lankan ports while operating on coastal trades.

Earlier this year, the Central Board of Indirect Taxes and Customs (CBIC) announced that Indian-flag vessels on EXIM and cabotage routes would be able to call at both countries en route. Previously, ships on such trades were not allowed to make such calls even if their routes took them past those ports and they have space to carry cargo such as fly ash or coal, of particular importance. The Indian National Shipowners Association praised the move, with CEO Anil Devli saying in a letter to the CBIC that it would allow operators to optimise cargo space, reduce costs and encourage a shift from carrying cargo by road and rail to sea, particularly for non-containerised cargo for which documentation is more complex. “We are certain that this reform will greatly assist not only the Indian shipping industry but also the trade and users of the coastal transport services within India,” he said. India has been slowly taking steps to relax the red tape on cabotage and transshipment cargoes, acknowledging in regulations updated last year,

which had been in negotiation since 2015, that goods may arrive in India via Bangladesh or Sri Lanka specifically and laying out the procedures for doing so. One of the first beneficiaries of the change has been passenger traffic, with a new river route opening between Dhaka and Kolkata as we go to press. According to the Bangladesh Inland Water Transport Corporation, the operation would ease shore and air transportation congestion. Sri Lanka’s Hambantota makes waves In Sri Lanka, meanwhile, although easier Indian trade is likely to be welcome, it’s been the saga of the southern port of Hambantota and the efforts of its operators to draw international traffic as a transshipment and bunkering hub that has continued to make waves. The journey from being the whitest of white elephants to a functioning, not to mention profitable, port complex is still ongoing and challenges certainly remain,

CMPort hopes to steer bunker traffic away from the traditional hub of Colombo ©JG Morard

World Bunkering SUMMER 2019

In October, HIPG signed a deal with Sri Lanka’s Laugfs Gas to make the port the “launch pad” for the company’s plan to make the country into an energy hub for the Indian Ocean. “The company believes that they are well placed to become a big competitor to Singapore, and Sri Lanka bringing in a strong strategic partner like CMPort as a port operator, will be a tipping point that would propel the country to a new age of trade and commerce,” HIPG said in a statement. “With a mega LPG storage complex already established adjacent to this southern port, Laugfs believes they could provide their target markets, a much better service than their competitors. This will be the largest and most modern LPG-related infrastructure in the Indian Ocean rim area.” Laugfs operates an LPG plant in the port hinterland and wants to bring in gas cargoes from larger international markets. At the time of the announcement, the company was planning on bringing in 20–30 ships every month for cargoes up to 30,000 tonnes. HIPG CEO Ray Ren said that the partnership would be a major confidence boost for the Hambantota Port enterprise. “The synergies HIPG and Laugfs will bring will give the Port the impetus to position itself not only as an energy hub but also as a major international player for shipping and logistics,” he said. “It will also open up a wealth of local job opportunities in different disciplines, which would be a boon to locals seeking employment and in the long term, the Sri Lankan economy.”

World Bunkering SUMMER 2019

Bunkering has long been mooted as one of Hambantota’s core business areas due to the port’s proximity to the main eastwest trades, but initial efforts to establish bunkering by the SLPA were a dismal failure. However, an open tendering process for bunkering operations at the port and the running of Hambantota’s sizeable bunker tank farm closed at the end of 2018 with HIPG announcing that six global bunker suppliers had expressed an interest and that the company would pick a winning bidder from those. World Bunkering approached HIPG for an update on this process at the time of going to press but the company couldn’t be reached for comment. However, HIPG’s COO Tissa Wickramasinghe told local press at the turn of the year that because the tank farm had been out of operation for over two years they were having to renew and prepare the tanks for service with “a lot of safety rules that need to be met”, suggesting that it may not be a quick process. At the same time, the port has moved to draw traffic from other sectors. At the start of the year, it handled its first shipment for the cement industry. According to HIPG, slag cargoes for Sri Lanka’s cement business have generally been transferred to smaller vessels at Galle harbour, which lacks the draught to take large bulk carriers directly; Hambantota’s extra clearance and relative proximity to production centres clearly make it appealing if the trade proves to be a success.

It’s also moved to draw laid up vessels presumably, until the port’s traffic picks up, the huge anchorage area it offers means that there’s plenty of spare room for the time being - and in March the Sri Lankan government approved the development by a Singaporean-Omani joint venture of a 10-million tonnes per year oil refinery on 400 acres of the Hambantota site, adding further tanker and products traffic to the mix. As a result of all these efforts to draw vessels, Hambantota saw annual calls climb 30% across 2018, albeit only to 300 vessels. HIPG said there would be a “manifold increase in vessel traffic in the new year, which would greatly increase the turnover of the port and in turn provide economic benefits to the Hambantota region.” So there’s reason to be optimistic, but Hambantota still has a long way to go. Slow but steady progress in Pakistan At the other end of the subcontinent, Pakistan has seen slow but steady progress in its bunkering ambitions, albeit tempered by the limitations of local refining. The country’s products industry is based primarily on hydro-skimming rather than more complex distillate processes that tend to produce higher volumes of high sulphur residual fuel oils as a result. The loss of the maritime market, not to mention government moves to clean up domestic use such as a ban on manganese in motor gasoline from April, is likely to squeeze Pakistan refiners’ margins further when IMO 2020 comes in.

Steps to ease coastal trades between India and Bangladesh could be a fillip to northeast ports ©Sharada Prasad

INDIAN SUBCONTINENT: INDIA, PAKISTAN, SRI LANKA

but things are certainly in motion under the port’s Chinese operators. It is technically a joint venture, operating as Hambantota International Port Group (HIPG), between China Merchants Port Holdings and Sri Lanka Ports Authority. However CMPort seems to be doing most of the steering.

INDIAN SUBCONTINENT: INDIA, PAKISTAN, SRI LANKA

owever, there are reasons for some optimism too. Local player Orion Bunkers became the first supplier in the country to be able to offer fuel to ISO 8217:2010 specifications. Orion’s director Zishan Arshad told World Bunkering: “We were working very closely with refineries in Pakistan to meet the demand of our customers who were eager to know about 2010 specs’ availability in Karachi. Overall, Karachi’s market volume has increased and after announcing 2010 specs [availability] we are seeing more business and those who are facing quality problems in other ports can bunker in Karachi with peace of mind with Orion Bunkers.” Asked about LSFO availability, given the need for the country’s state oil firm to import supplies since they aren’t produced locally, he said: “Currently, there is no such big demand for low sulphur products in Pakistan, however from bunkering prospects we have spoken with refineries to support and facilitate bunkering business with low sulphur products. On the other hand, we might have to import LSFO/VLSFO to fulfil bunkering needs in Karachi. However, PSO is only supplying LSMGO 0.1% and we have demand from customers from time to time and we are delivering it when there is such a requirement.” The challenges posed by local market conditions and the pressure to improve have seen smaller operators fade away, too. “Past few months were very good in terms of sales and volume due to very good price of 180cst compared to entire region and growing due to recently announced 2010 specs,” Arshad said. “The Karachi market has recovered from a bad phase and is growing with pace. I see this year as being the best comparing to the past five years because bad suppliers have left the market completely. And we have the edge over the others of supplying 2010 specs with very attractive price of 180cst which will ultimately bring more business.”

World Bunkering SUMMER 2019

LEGAL

SINGAPORE CORRUPTION CHARGE Bunker clerk charged with attempted bribery

ingapore’s prosecutors have charged a 35-year-old Chinese Singaporean, Lim Leong, with attempting to bribe a bunker surveyor into overstating the volume delivered. The bunker clerk faced one count of “corruptly offering gratification of an unspecified sum” to a surveyor, Keshminder Singh, who works for Viking Marine Services “as an inducement for certifying that a certain quantity of bunker fuel was supplied to vessel A70 when in fact a lesser quantity of bunker fuel was supplied”. A Corrupt Practices Investigation Bureau (CPIB) statement said of the alleged offence: “This constitutes an offence punishable under Section 6(b) of the Prevention of Corruption Act, Chapter 241. The CPIB said that Singh did not accept the bribe The CPIB added: “The bunkering industry in Singapore is among the largest in the world. It is important to protect the integrity of the industry and to ensure a level playing field for all. Singapore does not tolerate corruption. It is a serious offence to give or attempt to give bribes. Any person who is convicted of corruption can be fined up to $100,000 or sentenced to imprisonment of up to 5 years or to both.” The bureau said that it “looks into all corruption complaints and reports, including anonymous ones”. US sanctions on Venezuela can affect non-US persons The American P&I Club has issued a circular explaining the risks for non-US persons concerning transactions with Petroleos De Venezuela SA (PdVSA). The insurer notes that its members had already been informed that the US had imposed new and additional sanctions on the Government of Venezuela through the designation of PdVSA as a Specially Designated National (SDN).

World Bunkering SUMMER 2019

On January 28, 2019 the US designated PdVSA as an SDN and added it to the US SDN List. The immediate effect of this action was that US persons were generally prohibited from engaging in any transactions with PdVSA (subject to several general licenses) and that all of PdVSA’s property, and interests in property, in the United States or within the possession or control of US persons were blocked. These restrictions also applied to any entity 50% or more owned by PdVSA. Crucially, in addition to prohibiting US persons from dealing or transacting with PdVSA (or with any entity of which it owns 50% or more), the relevant Executive Order provides for the imposition of sanctions against non-US persons engaging in “sanctionable activity” with PdVSA. Although the prohibitions flowing from the designation of PdVSA apply only to US persons or to transactions with a US nexus, the relevant Executive Order pursuant to which PdVSA was designated provides the US Treasury’s Office of Foreign Assets Control (OFAC) with the authority to designate nonUS persons that engage in certain (sanctionable) activity with PdVSA, or with Venezuela in general, as sanctions targets (i.e. on a par with PdVSA). The SDN designation tool of OFAC is a way by which the US expands the application of unilateral US sanctions and enforces sanctions against non-US persons,

i.e. persons outside or beyond the traditional, general in personam jurisdiction (or reach) of the United States and US law. The club warns: “While there are no specific prohibitions aimed at nonUS persons transacting business with PdVSA, there is the potential that non-US persons could nevertheless be subject to sanctions either for operating in the Venezuelan oil sector, or for providing material assistance to, or support for, PdVSA. In an FAQ, OFAC has obliquely indicated that a non-US person could continue to purchase petroleum and petroleum products from PdVSA, as long as there was no US nexus. However the club notes that, on 5 April this year, OFAC announced that it had designated two companies operating in the oil sector of the Venezuelan economy as SDNs. Additionally, in an example where strictly non-US persons were involved, OFAC, in an action seemingly contrary to its earlier guidance, identified one vessel which transported oil from Venezuela to Cuba. The club concludes that, from the statements of the US State Department, it appears that OFAC most probably considers the purchase of petroleum products from, or the supply petroleum products to PdVSA by non-US persons to be sanctionable, and that it will exercise its discretion as to whether it designates as an SDN a non-US person involved in such transactions.

iStock

MAURITIUS The Mauritian government is continuing to push Port Louis as a bunkering hub ©Jitendra Sharma

ON THE MOVE As John Rickards reports Mauritius is getting closer to achieving its ambition of being a significant bunkering hub

he Mauritian government has been pushing hard for several years to take advantage of the island nation’s position to make it a hub for bunkering, and with Shell recently announcing that Port Louis would be one of its supply ports for VLSFO come 2020 and calls for Mauritius to move into LNG bunkering as well, things do seem to be moving. To get a view from the ground, World Bunkering spoke to the managing director of Southbond Shipping Agency Ltd, Gulshan Jugroo. WB: It’s been a tricky year in the wider sector; how have Mauritius and SSAL fared? GJ: SSAL had a great, busy year last year, particularly with clients coming for repairs for long periods. Being a one-stop shop as a shipping agent gives our clients peace of mind, be it with accommodation, repair contractors, transport and even arranging for lunch catering for over 70 crew members for months. We have also an in-house travel agency where we provide seaman tickets to our clients’ sign on/offs. SSAL entertains good relationships with various hotel establishments and hence passes attractive corporate rates to our clients. We have 100% returning clients for the past 25 years.

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With regards to the Mauritian sector, Port Louis has also had busy 2017–2018: cargo traffic has increased by 1.6% to reach 7.7 million tonnes. Bunkering in Port Louis also enjoyed an increase of 35.9% to reach over 550,000 tonnes. Cruise passengers visiting Port Louis reached 39,500, representing a 29.9% increase. The container sector also increased by 6.9%, mainly due to an increase in imports and also transshipments. There were approximately 3,250 ships calling at Port Louis during 2017–2018. WB: Last time we spoke you’d been seeing owners shifting to sourcing bunker quotes from agents rather than bunker traders - has that continued? GJ: I can only speak for SSAL and yes this trend has continued for us. Owners find that we offer better prices when we bid for spot prices. All is relative to the method of payment. ‘Cash’ payment equals better prices. WB: Are you continuing to see support from the MPA to boost Port Louis and its bunker industry? GJ: There have not been any new storage facilities built since our last conversation.

But the MPA is always trying to provide support to increase traffic. The bunker trade is a major segment that government and the MPA are actively promoting. It is estimated that some 35,000 vessels travel through our region each year, with less than 10% of ship traffic calling at Port Louis. Port Louis can capture more and more business with the increase of ship traffic in the region. Bunkering services are carried out all year round by six local suppliers, Indian Oil, Vivo Energy, Total, Engen, Taylor Smith Bunkering and Bomin. Three grades of bunker fuel, namely MGO (DMA), IFO 180 cSt (RME) and IFO 380 cSt are currently available in Port Louis. WB: What would you say the outlook for the coming year is? GJ: In order to further develop the bunker trade at Port Louis, the MPA has allocated land in the port area to private promoters for the construction of additional storage facilities, which will increase the storage capacity ashore from its current levels of 145,000 tonnes to over 200,000 tonnes by mid–2018. The government has announced that it intends to construct a petroleum jetty which will be located in Albion.

MAURITIUS

hese facilities will position Port Louis as a petroleum hub for the region and as an ideal location to supply bunkers to passing vessels. I have noted that some of our customers have requested the specs of fuel available in Mauritius as they need to adhere to their flag state requirements. Mauritius, I believe, is already ahead in the quality of fuel being supplied from here. Also the port, being a signatory to the MARPOL convention, has been supportive to local companies being involved in sludge removal. The price offered has encouraged many vessel owners to offload their sludge and have their tanks cleaned here. Iâ&#x20AC;&#x2122;d encourage any vessel owner to request a quote from their agent for such services. As regards to SSAL, we are continuing to deal directly with vessel owners with regards to their bunker and lube needs. Our high level of service is our pride, our word is our bond.

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World Bunkering SUMMER 2019

EQUIPMENT & SERVICES

CLASS APPROVAL FOR WIND POWER DNV GL certifies auxiliary rotor sail system for tanker

ngineering company Norsepower says that its innovative Rotor Sail Solution has received the first-ever classification society type approval design certificate granted to an auxiliary wind propulsion system onboard a commercial ship. The type approval from DNV GL was issued in February after a design assessment of Norsepower’s 30-metres by 5-metre Rotor Sail, two of which have been installed onboard the LR2 tanker Maersk Pelican. Norsepower says the certification means that vessels operating its system are “technically capable of safely navigating ‘all operational and environmental situations”. Norsepower says that its Rotor Sail Solution is a proven, lowmaintenance, easy to use and reliable fuel-saving technology, supporting the decarbonisation of the shipping industry. It has already been installed on three vessels and has achieved over 35,000 hours in operation, “ saving more than 4,500 tonnes of CO2 in the process”. The manufacturer adds: “The solution has delivered independently verified fuel savings with potential of up to 20%.”

Norsepower CEO Tuomas Riski said: “We are very proud to be the first company to have type approval granted to an auxiliary wind propulsion system onboard a commercial ship. Having a type approval design certificate is very important to us. Clearly, it provides shipowners, operators, and charterers with a level of assurance when investing in the Rotor Sail Solution, but in the long term, it removes yet another hurdle to the realisation of renewable wind energy propulsion systems at a scale that supports shipping’s transformation to a low carbon transport sector.” Geir Dugstad, Director of Ship Classification and Technical Director at DNV GL, added: “To help reduce shipping’s environmental impact we will need many different fuel and technology options, which is why we were very pleased that Norsepower asked us to be part of this innovative wind propulsion project.” Energy advisory system Wärtsilä subsidiary Eniram is to install an Energy Advisory System on Maersk Supply Service’s vessels. The system will use high quality data and is intended to optimise operations and save fuel in real time, lowering the company’s carbon footprint and fuel costs for customers.

Proof of concept will be carried out on two of Maersk Supply Service’s vessels: one M-class Anchor Handling Tug Supply Vessel (AHTS) and one I-class Subsea Support Vessel (SSV). After initial testing, the company plans to roll out the Energy Advisory System to four additional vessels, with the long term goal of installation across the entire fleet. Maersk Supply says Installation of the Energy Advisory System is just one of several initiatives the company has undertaken in an effort to reach its initial target of 5% reduction in fuel consumption by 2020. Testing of the system on the first two vessels is expected to commence during summer 2019. “World’s largest” battery package Corvus Energy says it has signed a contract with Norwegian Electric Systems (NES) for what it says will be the marine world’s largest battery package. The equipment is to be installed on board Havila Kystruten’s coastal vessels. Corvus Energy will deliver an air-cooled Energy Storage System (ESS) with its patented singlecell thermal isolation.

World Bunkering SUMMER 2019

New version of BV’s emissions reporting app France-based classification society Bureau Veritas (BV) has released Phase 2 of its online tool to facilitate compliance with fuel consumption regulations, My Fuel Consumption (MFC). BV says that is complies with both IMO’s data collection system (DCS) and the EU’s monitoring, reporting and verification (MRV) requirements.

“There is no one-size-fits-all solution for batteries. You have to optimize and compromise to find the right balance between energy density, capacity, performance and lifecycle to ensure the most optimal ESS solution,” says Stein Ruben Larsen, Senior Vice President Sales at NES, a total system integrator of electric systems for the global maritime market.

Available to the owners and managers of both Bureau Veritas and nonBureau Veritas classed ships, My Fuel Consumption is a secure cloud based web application available on desktop,

mobile and tablet. It is available on the Bureau Veritas client portal VeriStar to ship operators with a BV contract for IMO DCS or MRV services. Phase 1 of MFC released in April 2018 enabled the preparation of IMO DCS Plans (SEEMP Part II) for submission to Bureau Veritas for review. The new phase now enables reporting of fuel consumption for IMO DCS requirements and of CO2 emissions for EU-MRV requirements BV says that, using smart calculation engines, MFC ensures that vessel fuel consumption data is automatically registered for the different schemes.

Roger Rosvold, Vice President Sales at Corvus Energy says: “The unused potential for using batteries on board cruise and passenger ferries is huge. Batteries reduce fuel consumption and maintenance costs, cut pollution and, with increasing environmental regulations and requirements that will incur costs for air emissions, provide a very compelling business case. As more and more shipowners wake up to this, we expect to see uptake accelerating across the board. The industry is just starting to understand the power of batteries.” The newbuilds are part of Havila’s contract with the Norwegian Ministry of Transport for the construction of four environmentally-friendly vessels that will operate on the Bergen-Kirkenes coastal route. Two of the vessels will be built by Turkish shipbuilder Tersan and the remaining by Spanish shipyard Barreras. Featuring a length of 125 meters and a width of 20 meters, the ships will be able to accommodate 700 passengers. The vessels will have a hybrid gas-electric propulsion system with batteries. Four gas-powered engines in each vessel run the generators. The system is also capable of using hydrogen fuel cells. World Bunkering SUMMER 2019

The new ships will be able to operate in Norway’s fiords I zero emissions mode

EQUIPMENT & SERVICES

“T

his is a big step for the cruising industry and we are extremely proud to receive this order. It demonstrates that we drive technology further by pushing boundaries for the use of batteries. The ESS is the world’s largest package ever delivered to a ship and will enable the vessels to enter fjords and ECAs on zero emission mode five years before the deadline,” says Geir Bjørkeli, CEO of Corvus Energy.

SCRUBBERS

South Africa’s decision to allow open loop scrubbers in her waters is good news for owners who have fitted this equipment ©istock

REPRIEVE FOR SCRUBBERS Major study shows washwater compares favourably with water quality standards as installations continue apace

he South African Maritime Safety Authority (SAMSA) has announced it will accept all types of approved exhaust gas cleaning systems (EGCS) for use in its territorial waters. This decision bucks a recent trend among some ports and states to ban scrubber washwater from being discharged within their jurisdictions. The port areas that fall under SAMSA include Cape Town, Saldanha Bay, Port Nolloth, Port of Ngqura, East London, Durban, Mossel Bay, Port Elizabeth, and Richards Bay. This decision removes the prospect of vessels rounding the Cape of Good Hope having to sail outside the country’s 12 mile limit. In an IMO 2020 advisory notice issued in March to shipowners, operators, master mariners and bunker suppliers, SAMSA says the use of open-loop, closed-loop or hybrid systems are accepted until further notice “as an equivalent arrangement under Regulation 4 of MARPOL Annex VI for compliance with the sulphur limit [which] is currently based on the criteria stipulated in the 2015 Guidelines for Exhaust Gas Cleaning Systems (resolution MEPC.259(68))”. The Clean Shipping Alliance 2020 (CSA 2020) has welcomed the decision. Its Executive Director, Ian Adams, said: “We are delighted that South Africa has approved the use of open-loop systems in its waters”

He added: “We encourage all port authorities to seek out the available independent studies that provide detailed analysis of washwater discharges and describe the meaningful health benefits that reduced particle emissions can bring to their regions. CSA 2020 can provide useful information to facilitate each port’s decision-making process and is willing to meet with any port authority that seeks to learn more about exhaust gas cleaning systems.” In the last few years, open loop versions of the technology have been selected for more than 80% of the 2,500 or so ships that will have EGCS installations by the end of 2019. “Marine exhaust gas cleaning systems are the best way of reducing shipping’s environmental impact by significantly reducing air pollution whether a ship is at sea or in port,” said Adams. CSA 2020 presented a detailed study of the composition and quality of scrubber washwater in London in February. The three-year, Carnival-led study collected 281 washwater samples from 53 EGCSequipped cruise ships, the largest washwater data set in the marine industry, which were then assessed against 54 different test parameters by ISO accredited independent laboratories.

The resulting laboratory analysis reports were then evaluated by Classification Society DNV GL’s Maritime Advisory Services and the data compared against various water quality standards, after first confirming that the samples analysed were consistently well within the allowable IMO criteria and regulatory limits. Then the results were compared to selected national and international water quality standards and land-based waste water discharge limits, including the German Waste Water Ordinance, the EU Industrial Emissions Directive2010/75/ EU, and the EU Surface Water Standards Directive2013/39/EU. While these comparisons are not directly applicable to exhaust gas cleaning systems, as wellestablished and representative water quality standards that are protective of the environment, they were considered appropriate to serve as study benchmark standards. CSA 2020 noted that the results compared favourably with all of these standards. Carnival’s Senior Vice President for Marine Technology, Mike Kaczmarek, said: “Comparing scrubber washwater to various other major water standards is useful to provide perspective and to illustrate EGCS washwater quality in a way that is easy to understand.

World Bunkering SUMMER 2019

SCRUBBERS

hese comparisons also provide relatable criteria for a number of specific EGCS parameters of interest, such as PAH concentrations, which also have limits within these standards. Although these are all recognised standards that are designed to regulate other waters, they do provide confirmation of the quality of water that operators of this technology are returning to the sea, and they provide strong support to the IMO’s decision to approve these systems as acceptable means of compliance throughout the world’s regional and 2020 global emission control areas (ECAs).”

Wallenius Wilhelmsen recently joined CSA 2020, increasing the organisation’s membership to 35 shipowners operating a combined fleet of almost 2,500 vessels. Roger Strevens, Vice President, Global Sustainability, Wallenius Wilhelmsen, said: “The implementation of the IMO 2020 0.5% global sulphur cap is supported by the company, but it does represent a significant challenge for the shipping industry, not least from an anticipated hike in fuel costs and potential availability and quality problems.”

Adams said: “We want to emphasise that this major study was intended to provide an objective assessment of the quality of scrubber washwater through a rigorous comparison to other world water quality standards, and it now represents the largest, most credible and verifiable data set available. And importantly, the results reaffirm that exhaust gas cleaning systems are effective and safe for the ocean environment.”

He added: “To mitigate the risk and costs associated with these challenges, Wallenius Wilhelmsen will use low sulphur fuels on the majority of its fleet and scrubbers on the rest of its vessels. We join the Clean Shipping Alliance2020, to help ensure the wider industry and its stakeholders have a sound scientific understanding of the operational and environmental performance of scrubbers.”

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GencoShipping & Trading, which also joined the organisation recently, plans to install scrubbers on 17 capesize vessels with retrofit options for an additional 15 smaller bulk carriers. The decision follows extensive evaluation and analysis of the environmental impact of the technology. Meanwhile, in another sign that a significant number of owners are opting for scrubber, Norwegian manufacturer Yara Marine Technologies has installed an inline hybrid scrubber system for an undisclosed customer in the ultra-large container segment. Yara said that this was the biggest ship engine ever to be successfully fitted with an inline hybrid scrubber system. It added: “The project marks an important milestone in expanding areas where shipowners can achieve full and costefficient IMO compliance with SOx scrubbers. The inline hybrid scrubber system also covers the vessel’s five auxiliary engines.”

SCRUBBERS

istock

“T

he installation of Yara Marine’s inline hybrid SOx scrubber on the vessel confirms our customer’s commitment to protect the environment, not only from IMO-regulated SOx emissions, but also particulate matter (PM) and other hazardous substances from exhaust gas,” said Yara Marine Chief Sales & Marketing Officer Kai Låtun. “With the successful operation of this ultra-large container ship, we believe more vessel operators will follow in the same direction.”

Meanwhile UK-based Cleanship Solutions are carrying out a large container vessel operator’s scrubber retrofit program through 2019. Cleanship says the scrubber retrofit programme includes over 30 vessels ranging from 7500 TEU to 15000 TEU.

The contract covers all aspects of the scrubber retrofit engineering phase, including 3D scanning, Class design and production design. 3D scanning has mostly been completed already, with Cleanship’s large dedicated in-house survey team coordinating and attending vessel surveys in quick succession worldwide. The retrofitting of scrubbers on all the vessels is scheduled to be completed by June this year.

Alfa Laval is also being coy about which “leading Chinese shipping company” has selected Alfa Laval for scrubbers and comprehensive service. A leading Chinese shipping company is buying its PureSOx scrubber systems for 31 vessels in its fleet. The deliveries are supported by an extensive service agreement According to Alfa Laval, each scrubber will handle exhaust gas from one main engine and three auxiliary engines. The PureSOx systems are of the open-loop type but also hybrid-ready, which means it will be easier to convert them into hybrid systems if required. In another development, Magnesium Producers Nedmag and Timab Magnesium have formed a strategic partnership for development and commercialisation of magnesium hydroxide in marine gas scrubber systems. The two companies, based in the Netherlands and France respectively, have jointly developed a magnesium hydroxide product, MH53S MARE. The manufacturers say their product combines a very effective and safe alkali with extremely high purity and best-in-class stability properties and is a non-hazardous material, which contributes positively to crew safety.

Alfa Laval’s PureSOx scrubber system

World Bunkering SUMMER 2019

COMPANY NEWS

LANGH TECH SOx scrubbers, open loop and hybrid systems

angh Tech is one of the Langh companies, which also include ship owning Langh Ship, steel carriage and bulk containers from Langh Cargo Solutions and Industrial and Ship Cleaning Services Hans Langh. The knowledge for water purification originates from the industrial cleaning company. Langh Tech designs and produces scrubbers for SOx removal from exhaust gases and water treatment units for closed loop scrubbers. The water treatment units can be delivered also in combination with other manufacturers’ scrubbers. This unique water treatment method enables continuous closed loop operation causing only a minimal amount of sludge and hence reducing waste removal costs. The efficiency of the water treatment method is recognised throughout the shipping industry from cargo ship owners to cruise ship operators.

Langh Tech currently has over a hundred reference vessels, representing a wide range of ship types and scrubber types.

The system has been upgraded with new membrane technology to increase water cleaning capacity. With the new elements, a 50 % increase in water cleaning capacity can be reached compared to the previous elements, without increasing the size of the water treatment units.

Contact information LANGH TECH OY AB Alaskartano FI-21500 Pikis, FINLAND Tel. +358 (0)2 4779 400 www.langhtech.com

Langh Tech’s key message to shipowners and operators is that Langh Tech delivers the scrubber systems with a fast schedule and all the components are tailored individually for each project.

Water treatment systems Langh Tech scrubbers are available in open loop, hybrid and closed loop. The tower is available both as inline and U-type design. Both tower designs can be for only one engine or alternatively have multiple engines connected to same tower. The closed loop process is based on wet scrubbing with fresh water and using sodium hydroxide (NaOH) for neutralising sulphur. In open loop mode sea water is used in the exhaust gas washing process. The small and lightweight Langh Tech scrubber can replace the silencer. The scrubber and water treatment units are designed for both retrofit installations as well as new buildings. In addition to component delivery, Langh Tech takes care of commissioning and offers installation supervision, crew training and after-sales services. Langh Tech has launched a secondgeneration of water treatment systems available for both SOx scrubbers and Exhaust Gas Recirculation (EGR).

World Bunkering SUMMER 2019

Langh Tech scrubber installation on Corona Sea

FUEL MANAGEMENT

Time to weigh up the implications of using LSFO or distillates

KEEPING COSTS DOWN AFTER 2020 Companies throughout the bunker sector are preparing for the 0.50% sulphur limit

ut preparing for what? Uncertainties abound. Christian Plum, the co-founder of Danish-based BunkerMetric tells World Bunkering: “2020 is nearly upon us, and the long-awaited, angst-inducing global 0.50% sulphur cap will finally be enforced. Some have predicted Armageddon, others have opted for denial and business as usual; the former dramatic, the latter arguably fool-hardy. Over the past 12 months though we have seen increased activity with a number of ship owners and operators – particularly the large ones nailing their colours to the compliance solution mast; scrubber adoption is on the up, and refiners and suppliers are busily preparing a smorgasbord of low-sulphur blends. While the level of turbulence that 2020 will bring is still up for debate, the transformation and increased complexity within the marine fuel supply chain is a given. Agility, and the ability to adapt quickly to changing market conditions and marine fuel fundamentals will be a pre-requisite for success and seizing competitive advantage.” He notes that the increased spread between distillates and HFO is clearly a key factor for next year; some are predicting circa $250 per tonne, others believe that it will be closer to $400. Whatever, the reality is that owners and operators face a significant increase in annual fuel costs or need to dig very

deep into corporate coffers to finance the upfront capital expenditure required to retrofit scrubbers or switch to LNG; and with an as-yet unclear trajectory for pay-back. The distillate route has also helped to create a market for the increased uptake of fuel-saving technologies, Plum explains. Ranging from air lubrication systems, to rotor sails, owners are looking at any way they can to reduce fuel consumption and associated costs. It is a wise move, however, again there is a requirement to invest significant sums up front. In a market of little liquidity this is a tough ask for the majority of the market, particularly the smaller owners and operators. However, he continues, there are other ways to reduce fuel bills that all of the market can benefit from right now; specifically data-driven marine fuel analysis solutions that enable companies to effectively manage their marine fuel supply, and optimize their fuel procurement strategy on a vessel-byvessel basis. By providing insights and data, fuel buyers have the ability to make the best operational decisions to identify the optimal product grade, and the right time and location to lift bunkers. By doing this they can save an average of between 2% and 4% on their fuel bills. No massive injections of cash, or downtime while

rivets are being drilled into vessels. Just smart technology. Turning to his own company’s product Plum says: “This is what the BunkerPlanner solution – launched by BunkerMetric and maritime consultants 20|20 Marine Energy in 2018 – delivers. Using proprietary simulation and optimization algorithms and a multitude of datasets, BunkerPlanner considers a range of factors that impact bunkering decisions on a specific vessel and voyage level. This includes fuel price forecasts, availability, margin requirements, trading patterns and routes, vessel speed, fuel consumption, product specifications, the time a vessel spends in Emission Control Areas (ECAs), open-loop scrubber ban areas, sailing margins, tank sizes, co-mingling constraints, as well as costs related to deviations, port calls and barges. In crunching all this data, BunkerPlanner provides the fuel buyer with an optimal bunkering plan for each vessel, specifying the amount of each fuel type to purchase at specific ports. It also provides the fuel buyer an unprecedented level of agility within their fuel procurement strategy, where they can quickly adapt to fluctuations in the market where prices, availability and even regulations can change at very short notice.”

World Bunkering SUMMER 2019

ow,” he continues, “there is a generic level of scepticism when it comes to new innovations in the shipping industry. However, BunkerPlanner was initially trialled on a number of vessels owned by leading chemical tanker company MOL Nordic Tankers. Based on the results that BunkerPlanner delivered, the trial has now been extended to MOL Nordic Tankers’ entire fleet. The numbers are compelling. To date, based on data from 20 vessels, average fuel savings have been recorded at 3.1% or $54,000 per vessel. Based on BunkerPlanner being licensed on a per vessel basis, it pays for itself with immediate effect.” More generally Plum observes: “There is no doubt that the 2020 global sulphur cap will bring significant financial and operational challenges to the shipping industry; the increase in complexity cannot and should not be underestimated. However, there are solutions out there that can mitigate and reduce the level of risk and exposure to fluctuating market dynamics. Most importantly they don’t have to cost the earth or require the equivalent of invasive surgery; indeed a ‘key-hole’, data-driven approach can provide the best results.” Managing fuel switching safely Shipowners are likely to be focused on the situation that will exist immediately after the January 2020 deadline. However Finnish fuel supply systems provider Auramarine has urged the marine sector to look beyond just the initial choice of compliance solution ahead of the impending 0.50% global sulphur cap, and to fully understand the operational impact of using and switching to new low sulphur fuels and distillate products. Without this understanding or by not using best-inclass fuel supply systems, it argues, ship owners and operators risk engine damage and potentially catastrophic failure, as well as unexpected costs and unplanned downtime. The company has launched a ‘Get ready for 2020’ initiative, issuing a call to action for owners and operators to drive and encourage them to implement strategic forward planning to protect the future of their vessels and operations. It says: “Now more than ever it is crucial for shipowners to work with knowledgeable experts, allowing them to foster an understanding of how best to mitigate risks and minimise disruption, downtime, and unexpected costs and delays.” World Bunkering SUMMER 2019

Many of the main and auxiliary engines of vessels currently in operation may originally have been designed to run on fuels that differ from the new low sulphur products that are compliant with the pending regulations. Maintaining the correct fuel viscosity at the engine inlet is crucial regardless of the fuel in use, and the fuel supply system needs to be able to deliver the fuel at the engine inlet as specified by the engine maker in order to guarantee efficient combustion. Auramarine says that, when the 2020 regulation comes into effect, the majority of owners and operators are expected to comply by switching from high sulphur fuel oil to new very low sulphur fuel oils (VLSFOs) with sulphur content at, or below, 0.50%, unless their vessels are equipped with scrubbers. When switching fuels, issues arise when different fuels are present in the same pipes and tank, thereby causing issues with compatibility. This typically results in sludging and blockages in bunker and service tanks, pipe runs, filters, separator internals, and fuel injection equipment; all of which can have a serious detrimental effect on the health of the engine. The company has launched its FuelSafe changeover system that enables a vessel to use different fuel types and comply with sulphur emissions requirements while optimising the vessel’s fuel economy. Auramarine says its system is compatible for both newbuilds and retrofits and can be quickly installed and made operational. Ole Skatka Jensen, Chief Executive Officer, Auramarine, comments: “Assessing new technologies or practices is only the first step on the journey towards safe, efficient and compliant operations in a post-2020 environment. Ship owners also need to consider the potential impact that these significant operational changes will have on engines and therefore vessel performance. It is crucial that ship owners thoroughly evaluate the exact needs of their vessels at the outset of assessing which compliance solution they will employ, and set in place an efficient and effective fuel supply system that will not only protect the operational integrity of the vessel but also their profitability. He continued: “Whichever compliance solution is employed, effective and comprehensive management of fuel supply and fuel switching, combined

with proactive condition monitoring, can ultimately become the difference between a safe, compliant and efficient vessel, and unintended downtime, lost profitability and potentially catastrophic engine damage.” Implementation advice from ClassNK Japanese classification society ClassNK has developed and made available Guidance for onboard use of Compliant Fuel Oil with SOx regulation from 2020 and an implementation plan sample for switching to compliant fuel oil. ClassNK notes that compliant fuel oil is anticipated to include more low-sulphur blend stocks than ever before in addition to light distillates. It has identified five properties of compliant fuel oil that should be taken into consideration with its use. These are compatibility, low viscosity, cold flow properties, cat-fines and ignition/ combustion quality. The guidance explains the basic characteristics of each property, and the potential safety implications associated with them. The guidance is available to download free of charge via ClassNK’s website www.classnk.com for those who have registered for the ClassNK “My Page” service. The classification society notes that MEPC Circular MEPC.1/Circ.878 recommends that ship operators create and keep onboard a Ship Implementation Plan that shows how ships are preparing for the 0.50% sulphur limit. ClassNK has provided a sample entry of this for interested clients. ClassNK also provides appraisal services to confirm that ship implementation plans include the items listed in MEPC.1/Circ.878. Additionally, it provides other appraisals tailored to individual client needs for confirming facts such as whether a fuel tank has been cleaned before switching to compliant fuel oil etc.

Christian Plum

FUEL MANAGEMENT

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BUNKER HOLDING GROUP - FUEL MANAGEMENT

SEDIMENT STABILITY AND COMPATIBILITY OF FUTURE 2020 FUELS Cracked asphaltenes held in suspension in Fuel Oil is a Delicate Balance!

o elaborate on fuel oil Stability & Compatibility it is relevant to define, what is stability and what is compatibility. Both terms are often used as one and the same. Stability is the capability of a fuel to keep asphaltenes in suspension. If a fuel oil is full stable it will not precipitate sediments of asphaltene. Compatibility is the capability of two fuels to blend into a stabile product. With the introduction of 0,1% sulphur limits in ECAâ&#x20AC;&#x2122;s in 2015 lot of fuel oils, with Vacuum Gas Oil VGO as the main

component, were introduced to the marked. Commonly for those fuels are they are very paraffinic and with no or extremely low concentrations of asphaltenes. Per definition it gives no sense to talk about stability in those products as there are no asphaltenes to precipitate. By blending the very paraffinic oil with residual fuels with cracked asphaltenes; the asphaltenes will agglomerates and precipitate in tanks, separators and filters creating huge problems, why many owners refrain to purchase those fuels. A fear is that 2020 0,5% S fuels will be

high paraffinic products supplies from some suppliers and more naphthenic asphaltene containing from others and that there will be low compatibility between those fuels. In cooperation with one of the biggest and most recognised Marine Fuel Test Providers, Bunker One performed several blend tests based on known and available fuels and available blend stocks in Northern Europe.

#1 Light Cycle Oil (LCO). #2 Marine Diesel. #3 Cracked residue. #4 Vacuum gas oil. From those we made three 2020 compliant blends with sulphur content of 0,5%.

I. II. III.

#1 & 3 turned out very stable, TSA 0,01 #2 & 3 border line result, TSA 0,10 #3 & 4 unstable with TSA of 0,18

Dry spot test 1 (Stable) Dry spot test 2 (Border line) Dry spot test 3 (Unstable)

Then we tried to blend them further with 6 already available ECA fuels; which we found as problematic fuels.

World Bunkering SUMMER 2019

The #I product blended very fine with all other products with exception of one border line. #II product blended with the outcome of three unstable and 4 stable. And finally, the #III product blended exactly as the #II product with same 3 unstable and 4 stable with TSA 0,01% or less. Looking deeper into those non-scientific tests gave confidence to the theories we assumed. The most aromatic blend #I turned out as a very compatible product. But that the borderline #II and the unstable product #III managed to blend into 4 out of 7 very stable products, was positively surprising. Not surprisingly we found the very paraffinic products would not blend with the cracked products and from our still non-scientific tests we define Paraffinic products as low-density products, very low on Micro Carbon Residue and absence of cat-fines.

Marked with yellow the characteristic of the oils blending to unstable products We introduced the test Toluene Equivalent Test, (TE) which is a relatively inexpensive and simple test, however not a part of ISO8217. It is an expression for the stability reserves of an oil. The result is expressed in percentage from 0 to 100 and the lower number the better stability reserves. The tipping point whether it is a compatible product or not seems to be about 50% with few exceptions however the few exceptions which turned out more stable than expected. A stable product is by us defined as a product with TSA complying with ISO 8217 =/< 0,1% With the characteristics we have from a ISO 8217 tests, cleanliness/stability spot test and the Toluene Equivalent we can develop simple algorithms that gives a very good hint of compatibility or not. And by experience; when we judge wrong, the results are more stable than expected. Conclusions: The investigations we made so far gives a relatively good confidence on the stability problems we will see with the future fuels. The present pricing of feeds to the 0,5% volumes gives advantages to the more naphthenic and aromatic blends and if the spread widens more between distillates and residues this will be enlarged. Thus, the majority of 2020 fuels will look much like the 1% fuels we knew from ECA’s 2012 – 2015. Lower on viscosity and density and not least also lower on asphaltenes (MCR) and unfortunately same or elevated numbers of cat fines. Lower density and lower viscosity will increase the efficiency of the separators; therefore, we should not necessarily fear elevated cat fines as long they are within the existing ISO limits.

Also, we will see straight run fuels deriving from sweet heavy crudes, like the Doba, Dar, Cabina crudes and others. Hardly produced by the oil majors, but by trading houses and “stand alone” units producing fuel directly to the shipping industry. When the fuel blenders get more familiar with the fuels, they might be blended, or “ISO 8217 adjusted” with slurry, which will make them cheaper, but unfortunately also introduce cat fines. There might still be room pricewise to produce the very paraffinic fuels for use in the ECA’s as we know already today.

And TE testing can be introduced where bigger volumes are in play or where we need to make kind of worst-case blends. By our experiences from the lab tests we made and the tests we continuously make of 2020 compliant fuels we start to see in the marked our conclusion is that: “Yes! We will experience compatibility problems”. But we will be able to predict the problems simple and with relatively high certainty. And the problems will most probably not be worse than what we already experience today in ECA’s and have experienced worldwide from the last decades.

From an ISO 8217 laboratory test, plus a Cleanliness/stability test which very simply can be made locally, we have good tools to predict if two 2020 compliant fuels are compatible.

Toluene Equivalence Test by Blending in separate bottles 10 ml. of test liquid and 2 grams of oil. By varying the vol. % toluene mixed with n-heptane in the test liquid, determine the minimum % toluene required to keep the asphaltenes soluble.

World Bunkering SUMMER 2019

BUNKER HOLDING GROUP - FUEL MANAGEMENT

e chose a kind of worst-case scenario, simulating a half empty tank to be filled to full. So we blended 50/50 between our own blends and with 6 ECA compliant fuels.

BUNKER HOLDING GROUP - FUEL MANAGEMENT

GUIDELINES FOR 2020 MARPOL COMPLIANCE B

unker One have performed comprehensive laboratory testing of consequences from possible compatibility problems post 2020. This in cooperation with one of the leading and most recognised fuel test providers and we continue testing all the new products we see in the marked and can get hold on from various refineries and fuel blenders. Also we have now 5 years’ experience from changing between HS and LS for vessels trading ECA’s. We have concluded that we will experience compatibility problems, but not necessarily worse than we have experienced during the last many years. The biggest concern is if there are any piles of asphaltenes and catfine’s in the tanks which might be dissolved by introducing more naphthenic and aromatic fuel into the tanks, jeopardizing the safety of the vessel with separator and filter problems. This also happens occasionally today, but special attention should be given, also where the problem never has happened, because the characteristic of the fuel will change. We recommend inspecting as many tanks as possible prior change to 0,5% products and dig out the piles, if any, with shovel and buckets as necessary. Inspection of bunker tanks should be part of the SMS and be performed as frequent as possible and not less than at every planned dry docking.

can make compatibility test and our recommendations can be close to bullet proof. A cleanliness/stability test is a valuable tool for evaluating two products before blending and switch-over, especially until we get familiar with the new products. A cleanliness/stability test is very simple and can be made locally without investment in expensive testing equipment. We have developed a small guideline for that which can be given on request. For vessels trading in routes where it will be necessary or profitable to change between Cracked Fuels and Paraffinic Fuels we can re-designing the fuel system for the specific purpose, it is not huge conversions, but in most cases can be managed only with pipework, valves and common sense. To perform due diligence and to proof best practise for authorities it is necessary to make a bunker plan. We have made an example here below. By experience the sulphur content use to be on the lower side of the limits when introducing new sulphur regulations. However also by experience we know the fuel blenders

relatively fast gets familiar with the blending processes and optimise their products to the limit with very little or no margin. It is of course important your fuel supplier initially can supply a product with a small margin otherwise the vessel will never come into compliance. Bunker One will do outmost for securing a margin for the products to be delivered in 2019 – Ask you Bunker One seller for the specific sulphur content prior bunkering so you can perform your due diligence. Alternatively, one can flush the tanks with a gas oil 0,1% S. The principles are of course the same, with a bigger sulphur margin to 0,50% If this is attractive depends on how you can organise and your timing on the changing process. In the Bunker One 2020 WEB package www.bunkerone.com... you can find a number of fuel related risk assessments, guidelines etc. which you can use for inspiration and copy paste as you like. (Under development)

From our testing we have gained experience identifying the most problematic products and we offer a validation of the fuels prior to filling with our products. Send us the ISO specification of the fuel onboard (as accurate as possible) and we will evaluate the parameters with the fuel you ordered and from that give our best recommendations on stability and compatibility issues. Even better send us a physical sample then we

World Bunkering SUMMER 2019

BUNKER HOLDING GROUP - FUEL MANAGEMENT

World Bunkering SUMMER 2019

BIO FUELS

istock

BIG NAMES EMBRACE BIO Major players in the shipping and energy businesses are exploring the use of biofuels at sea

wo groups of big companies have announced significant developments towards to development of biofuels as a marine fuel. In the case of a project involving IKEA Transport & Logistics Services, CMA CGM, the GoodShipping Program and the Port of Rotterdam, the 5,095 TEU container vessel CMA CGM White Shark was refuelled with the bio-fuel in March, while calling at Rotterdam. The project’s partners say that results from the trial will give the maritime sector a vital demonstration into the scalability, sustainability and technical compliance of sustainable marine biofuel oil. This will benefit all industry stakeholders in their environmental strategies, in line with the impending IMO decarbonisation pathway.

The sustainable marine biofuel oil was developed by GoodFuels after undergoing three years of intensive testing with marine engine manufacturers. The second-generation bio-fuel oil is completely derived from forest residues and waste cooking oil products, is expected to deliver 80-90% well-to-propeller CO2 reduction versus fossil equivalents,

and virtually eliminates sulphur oxide (SOx) emissions. Using the fuel does not require any engine modifications. The trial was facilitated by the GoodShipping Program, a sustainable initiative dedicated to decarbonising ocean freight. Meanwhile a group of Dutch multinationals - FrieslandCampina, Heineken, Philips, DSM, Shell and Unilever - all members of the Dutch Sustainable Growth Coalition (DSGC), are joining forces with A.P. Moller - Maersk to “take a tangible step towards the decarbonisation of ocean shipping,” they say. A pilot, using up to 20% sustainable second-generation biofuels on a large triple-E ocean vessel will sail 25,000 nautical miles from Rotterdam to Shanghai and back on biofuel blends alone “saving 1,5 million kilograms CO2 and 20,000 kilograms of sulphur”. As with the CMA CGM project, the biofuel is produced from waste sources, in this case used cooking oil. DSGC members and Maersk say that they all agree that tackling harmful emissions related to shipping is urgently needed,

and that cross-industry collaboration is required to develop, test and implement new solutions. The DSGC members, many of which are customers to Maersk, played a critical role. They initiated and sponsor the pilot. Shell acts as the fuel supplier for the pilot and Maersk plays the role as operating partner. The group behind the project say that sustainably sourced second-generation biofuels are just one possible solution for the decarbonisation of ocean shipping. They add: “Longer term, breakthroughs in fuel and technical development (i.e. e-fuels) and the investment into commercial supply chains are needed to achieve significant emissions reductions. “DSGC companies join in action to contribute to the UN SDGs. With this initiative we focus on Climate Action (SDG 13). We have taken the initiative to partner with A.P. Moller Maersk on this important effort,” says DSGC Chair Jan Peter Balkenende. “This pilot testing biofuel on a cross ocean shipping lane marks an important step. However, many more innovations are urgently needed.

World Bunkering SUMMER 2019

hese can only be successfully developed, tested and implemented in industry collaborations like this.” Søren Toft, Chief Operating Officer A.P. Moller - Maersk commented: “To reach our net zero CO2 target by 2050, in the next 10 years we need big breakthroughs. Maersk

BIO FUELS

cannot do this alone. That is why this collaboration with DSGC and its members is such an important step in identifying and bringing low carbon solutions to life. It lays the foundation for how crossindustry partners can work together to take steps towards a more sustainable future. We welcome others to join in our efforts, as this journey is just beginning.”

Søren Toft added “Biofuels are one of the viable solutions that can be implemented in the short and medium term. Through this pilot, we aim to learn more about using biofuels in general, and to understand the possibilities around increasing its usage in a sustainable and economical way.”

This CMA CGM container ship took on biofuel as bunkers in Rotterdam recently

World Bunkering SUMMER 2019

OIL MAJORS

iStock

EXXONMOBIL TARGETS DIRECT SALES We look at how the world’s fourth biggest oil company by revenue is adapting to a changing bunker market

xxonMobil has changed its business model to focus on expanding direct bunker sales. “ExxonMobil has analysed all the markets, where the company is active, in order to evaluate which strategy is the optimum and most effective for both the company and its clients. As a result the said strategy may not apply only to major bunkering ports like Singapore and Rotterdam, but to smaller ports also like Hong Kong, Genoa, Thailand and Marseilles,” ExxonMobil marine fuels venture manager Luca Volta, recently told Ship & Bunker.

into the UK, which imported about half of its supply in 2017. The more than $1 billion investment includes a hydrotreater unit to remove sulphur from fuel, supported by a hydrogen plant, which combined will also help improve the refinery’s overall energy efficiency.

The oil major says: “Alongside recent investments at ExxonMobil’s refineries on the U.S. Gulf Coast, Rotterdam, Antwerp, and Singapore, the project will contribute to ExxonMobil’s announced plans to significantly increase the earnings potential of its downstream business by 2025.”

Construction is scheduled to begin in late 2019, subject to regulatory approval, and start-up is expected in 2021.

The company expects its new approach will not only safeguard quality but also increase sales and cut costs. Nevertheless it says it will still offer its products through traders. Volta added: “We believe we have the right bunker fuel products and that we can deliver them in a cost effective way. But that doesn’t mean if you have a direct channel to market, you can’t also have an indirect channel to market. The two options are not mutually exclusive.” Meanwhile ExxonMobil made a final investment decision in April to expand its Fawley, UK refinery to increase production of ultra-low sulphur diesel by almost 45%, or 38,000 barrels per day, along with logistics improvements.The investment will help reduce the need to import diesel

World Bunkering SUMMER 2019

As they are oil refiners, the 2020 global sulphur limit has profound implications. Grace Quinn, Senior Manager at consultants Baringa Partners, examines the decisions facing the oil companies

n simple terms high-sulphur fuel oil (HSFO), consisting chiefly of low value residual products from refining, has been the dominant fuel of choice for shipping for decades, and this regulation will put an end to that. In order to comply with this new legislation vessels have the option of burning ‘’cleaner” fuels such as LNG, middle distillate fuel (MDO/ MGO) or one of the growing portfolio of low-sulphur fuel grades (VLSFO) becoming available. Dual fuel engines can accommodate a mixture for those who want to exercise some optionality. Alternatively owners and operators can invest in a scrubber and continue to burn HSFO as a bunker fuel - a move some view as an environmental dodge. It is estimated that there is approximately 1.5 million barrels per day of new compliant supply needed to enter the bunker market in 2020 to support the regulation. This will be a mix of blends of VLSFO and MGO. In order to support this product demand refineries will need to reconfigure their product slates which comes at a cost. The investment cost associated with a change in production configuration is one refiners have been reluctant to commit to so far, primarily due to uncertainty in demand. While it is difficult to predict compliance, a surge in MGO demand is expected initially to meet IMO requirements, which will require a significant increase in refinery throughput and potential upgrades. The fact that MGO is a high-yielding product does act as an incentive for refiners but it is a double edged sword. Producing more MGO will lead to a surplus in HSFO as it is a natural by-product. Where in the market will this be placed? While this is an opportunity to explore alternative end users beyond bunkering, power generation and industrials, it is currently an area of ambiguity. Additionally there is a storage cost associated with producing new blends and greater quantities of MGO which needs to be built into the economics. What if refiners overestimate the demand for MGO and World Bunkering SUMMER 2019

underestimate the uptake of scrubbers and in turn demand for lower cost HSFO? They will be left with surplus MGO and considerably worse off from their investment. Having said this, refiners are a key influencer of how this regulation plays out. How shippers choose to meet IMO requirements is after all subject to fuel availability. While there is an element of the chicken and the egg, the more certainty refiners can provide the market with, the more influence it will have on how ship-owners decide to comply. New information on the availability of compliant product blends is building some confidence, however questions regarding stability and compatibility should be expected to remain for the foreseeable future. A recent study by Galbraith showed that the great majority of refiners foresee compatibility issues between compliant fuels from 2020 onwards, suggesting that owners are correct to have this issue at the top of their main concerns surrounding the regulation. At a market level the value of crude oils will change, as high sulphur, heavy crudes become less valuable and lighter ‘sweet’ crude slates will rise in demand. As only a third of global crude oil production is ‘sweet’ there will be increased competition for availability which will be reflected in the price and have an impact on global trade patterns. Like most industries it is easier for some players to react to change than others. Refineries that are well configured to support the IMO 2020 legislation are set to increase their margins considerably. Refineries that are not as flexible will have to undertake considerable investment which will be recouped across the supply chain. However the degree of investment required will vary depending on the refinery in question. To date, few have committed to major capital projects which only feeds the shipping industry’s uncertainty around supply security, quality and compatibility. For those that have committed these projects will take a number of years to implement which will give rise to potential tightness in the near-term.

Refiners should bear in mind that post January 1, 2020 the bunker market and its demand landscape will continue to evolve so while it is a deadline for compliance it does not mean that it will present a stable forward view. For instance owners whose current fleet are nearing the end of their commercial life may have come to the conclusion that in the near-term the investment of a dual fuel engine or scrubber cannot be justified and have chosen to purchase a higher cost low sulphur fuel to comply. However they may have committed to a scrubber or LNG propulsion strategy for new-builds which will shift their demand to LNG or HSFO if they have gone down the scrubber route. Similarly the majority of scrubbers on order will not be fitted by January 1, 2020 due to bottle-neck issues, which will impact the view of HSFO for some time to come. As the imminent deadline of 2020 looms, calls for more commitment from the refinery sector are mounting. With so many uncertainties the hesitation can be understood. However there are some areas where regulators could support them by providing more clarity and assurances. Enforcement of the regulation is a major concern for refiners due to the investment in change they will have to make. Having a strong framework in place, which ensures consistent policing and fitting repercussion for non-compliance would go a long way. Additionally working to ensure global fuel standardization regarding the composition and quality of low sulphur fuels would provide more market confidence. For all involved, reputation is at stake.

Grace Quinn

OIL MAJORS

DIFFICULT DECISIONS FOR OIL MAJORS

LNG

STUDY BACKS LNG Findings support claims LNG could be major contributor in meeting IMO’s 2050 GHG targets for shipping

esearch commissioned by SEA\ LNG and the Society for Gas as a Marine Fuel (SGMF) has found that greenhouse gas (GHG) reductions of up to 21% are achievable now from LNG as a marine fuel, compared with current oil-based marine fuels over the entire life-cycle from ‘well-to-wake’ (WtW). It also confirmed that emissions of local air pollutants, such as sulphur oxides (SOx), nitrogen oxides (NOx) and particulate matter (PM), are close to zero when using LNG compared with current conventional oil-based marine fuels. SEA\LNG and SGMF say the study was conducted according to ISO standards by leading data and consultancy provider Thinkstep. The report has been reviewed by a panel of independent academic experts and is, they say, the definitive study into GHG emissions from current marine engines.

15% for 4-stroke medium speed engines. Currently 72% of marine fuel consumed is used by 2-stroke engines with a further 18% used by 4-stroke medium speed SGMF Board Chairman, Chad Verret, added: “LNG is SAFE to use, fully compliant and readily available as a marine transport fuel. Standards, Guidelines and Operational Protocols are all in place to ensure that the safe way is the only way when using gas as a marine fuel. LNG meets and exceeds all current and 2020 marine fuel compliance requirements for content and emissions, local and GHG. With the world LNG Bunker Vessel fleet doubling in the next 18 months and those vessels being deployed at major bunkering hubs, LNG as a ship fuel is rapidly becoming readily available.”

According to the two LNG promotion bodies: “Ongoing optimisation in supply chain and engine technology developments will further enhance the benefits of LNG as a marine fuel. Additionally, bioLNG and Synthetic LNG - both fully interchangeable with LNG derived from fossil feedstock - offer the potential for significant additional GHG emissions reductions. For example, a blend of 20% bioLNG as a drop-in fuel can reduce GHG emissions by a further 13% when compared to 100% fossil fuel LNG.”

Commenting on the report, SEA\LNG Chairman Peter Keller stated: “The Life Cycle GHG Emission Study is a longawaited piece of the “LNG as a marine fuel“ puzzle. It not only confirms what we already knew in terms of LNG’s immediate impact on air quality, human health and its cleanliness, but clearly highlights the genuine, substantiated GHG benefits of using today’s marine engines capable of burning natural gas. Moving from current Heavy Fuel Oil (HFO) to LNG does reduce GHG emissions. LNG does contribute to the International Maritime Organisation (IMO) GHG reduction targets. And it is clear that LNG is the most environmentally-friendly marine fuel that is readily available and safe, both today and in the foreseeable future.” On an engine technology basis, the absolute WtW emissions reduction benefits for LNG-fuelled engines compared with HFO fuelled ships today are between 14% to 21% for 2-stroke slow speed engines and between 7% to

SEA LNG Chairman Peter Keller

World Bunkering SUMMER 2019

LNG

liver Schuller, Team Lead Energy & Mobility at Thinkstep noted: “The main goal of this study was to provide an accurate report of the life-cycle GHG emissions from LNG as a marine fuel compared with conventional marine fuels.” The report used data provided by original equipment manufacturers including Caterpillar MaK, Caterpillar Solar Turbines, GE, MAN Energy Solutions, Rolls Royce (MTU), Wärtsilä, and Winterthur Gas & Diesel, as well as by ExxonMobil, Shell, and Total from the supply side. It is quality assured in assessing the supply and use of LNG as a marine fuel according to ISO standards.

WE claims the electric power solution allows the vessel to achieve Ice Class 1A propulsion, while still slashing fuel consumption, costs and emissions. Using the Power Take Out (PTO) mode, WE Drive enables propulsion machinery to operate in combinator/ variable speed, while the direct-drive permanent magnet shaft generator produces electrical power up to 700 kW for the vessel’s electrical network.

The manufacturer says: “This delivers significant savings by drastically decreasing the operating hours of the auxiliary generators, saving fuel and resulting emissions – as well as reducing maintenance requirements.”

LNG-fuelled bulker designs Japan-based classification society ClassNK has granted an Approval in Principle (AIP) to Kawasaki Heavy Industries (KHI) for their project on the concept design of an LNGfuelled 207K dwt bulk carrier. The AIP is based on ClassNK’s Rule Part GF which adopts the IGF Code (regulation for ships using lowflashpoint fuels). ClassNK Corporate Officer and Director of Technical Solution Department Hayato Suga said: “The maritime industry has been setting its sights on LNG as an energy source for ships as it is an environmentallyfriendly alternative to fossil fuels. Kawasaki Heavy Industries is taking full advantage of this opportunity as well with their new bulk carrier design. We have carefully confirmed the safety of the design and are proud to contribute to this project.” Meanwhile the world’s first LNGfuelled bulk carrier, ESL Shipping’s ice-class 25,600 dwt Viikki and her sister ship the Haaga use WE Tech’s variable frequency drive technology WE Drive and The Switch direct drive permanent magnet shaft generator.

World Bunkering SUMMER 2019

COMPANY NEWS

PROVIDING THE BEST SERVICES Big enough to be powerful, small enough to be agile

ur aim, at Bunkeroil, is to offer our clients a truly competitive advantage by providing the best services in terms of maritime transport, delivery & sale of oil products and the relationship between shipowners and port operations.

international expansion in the lubricant sector began in the second half of the 2000s. Today, we cover all of the world’s main ports as bunker and lubricant traders, of course with a greater focus on the Mediterranean Sea.

We offer bespoke solutions with a high added value when it comes to operational flexibility and financial conditions.

In 2018 we launched a constantly stocked lubricants storage service as leading ExxonMobil Distributors for local market in the territories of Italy and Malta.

With years of experience in the industry, we have developed a well-established network that enables us to respond to client requests promptly. We offer our clients: •

Since the company was founded in Livorno in 1980, our history has always been marked by constant growth and focus on the quality of our products and services, as well as on client satisfaction. This has made us one of the key players in bunker and marine lubricants sale, both nationally and in the Mediterranean. From the port of Livorno, our marine fuel and lubricant distribution operation began to expand into all Italian ports, in order to meet the diverse needs of our clients in an increasingly comprehensive way.

The cornerstones of our work. Being a supplier is not enough, and that is why we strive to form partnerships with our clients, through: • • • •

the best products in terms of quality; maximum operational flexibility; problem solving; bespoke financial solutions.

• •

availability of the product or equivalent alternatives; 24/7 service; the most competitive price on the market, thanks to our greater purchasing power.

BUNKEROIL CONTACTS: Address: Via Pietro Paleocapa 11, 57123, Livorno, ITALY. Phone: + 39 0586 219214 Bunker enquiries: bunker@bunkeroil.it Lubricant enquires: lubricant@bunkeroil.it Please visit: www.bunkeroil.it Follow us on Linkedin: Bunkeroil

From the outset, our shipping activity in the transportation of petroleum products in the Mediterranean has run alongside the Bunker service, and in the early 2000s we upgraded our fleet. During the same period, we launched the Clearing and Shipping Agency service in the port of Livorno, whilst our

World Bunkering SUMMER 2019

Bunkering by truck or by barge in all French ports

reated in 1999, ATLANTIC ENERGY is a French company specialized in bunkering operations and negoce fuels. We are able to deliver our products in all the French ports and to supply all vessels with Marine Gasoil or Fishing Gasoil (max Sulphur 0,10 %) by truck in France.

ATLANTIC ENERGY have created a bunkering opportunity by barge at ROUEN and LE HAVRE port area to supply Marine gasoil 24 hours a day, 365 days a year, via dedicated barge service. Our barge can deliver all required fuel volumes, starting from 10 MÂł up to 700 MÂł.

We are also able to meet your marine fuel oil requirement on RMG380 HS (max Sulphur 3,5%) and RMG380 LS (max Sulphur 1,5 %) by truck in South port. In order to ensure compliance with the ISO-8217, all products delivered by ATLANTIC ENERGY are regularly analyzed. We deliver all the products in respect of Marpol regulation.

All the ports in Channel, from Dunkerque to Brest by truck and at Le Havre, Rouen by truck and by barge. All the ports in Atlantic coast, from Brest to Bayonne by truck. All the ports in Mediterranean coast, from Monaco to Port Vendres by truck. ATLANTIC ENERGY can offer to owners, to charterers,to operators and to traders inner French ports.

World Bunkering SUMMER 2019

COMPANY NEWS

ATLANTIC ENERGY

COMPANY NEWS

GALP GETTING READY FOR 2020 Galp, and its subsidiary companies including Petrogal SA, is the only fully integrated energy group in Portugal

ts activities range from oil and natural gas exploration and production to the refining and distribution of petroleum products, the distribution and marketing of natural gas and the generation of electrical power. It has more experience than any other Portuguese company in the energy sector, with a successful business history that stretches back over 100 years. The company entered the stock market in 2006. Galp is the market leader in Portugal in the petroleum product distribution business and has a significant presence in Spain. This business includes the sale of refined products to direct customers, namely to the retail sector and filling stations, and to the business or wholesale segment: transportation, aviation, industry, contractors, marine and lubricants. In what concerns the bunkers marine business, the company is getting ready for the 2020 challenge. Researching, studying and testing several possibilities to achieve one goal: to be ready to supply the market in 2020. During the Atlantic Meeting Conference, organized every year by Galp for their clients, the company revealed details about its plans. Galp explained its studies and all the work done so far in what concerns the Global Cap 2020.

From the refinery perspective, regarding the product quality, Galp has showed that there are several options on the table; residuals and/or distillates to achieve the 0.5% Sulphur cap, paying special attention to the productâ&#x20AC;&#x2122;s stability and compatibility factors that remain a concern in the market. Galp also illustrated the logistic challenges that new products can bring to a supplier and how the company is dealing with it. Moreover, Galp is also prepared to supply LNG in the Portuguese ports. Initially it will commence with truck deliveries but other delivery options of pipeline and/ or barge supplies will be considered as well according to the market growth and potential. Additionally, views relating to market expectations, likelihood of compliance and the differing views of future price trends were also discussed at the Atlantic Meeting Conference. Galp continues to grow itâ&#x20AC;&#x2122;s bunkers business dedicating special attention to bunkers only calls in the port of Lisbon. Working closely together with the Port Administrations to reduce calling costs, offering competitive prices and making Lisbon a port not just for cargo operations or bunker liftingâ&#x20AC;&#x2122;s but also a port where ships can be provided with all kind of extra services.

Galp remains ahead of the market priding itself in supplying fuels that already meet the latest ISO edition, i.e.; ISO 8217: 2017. Is also cofounder and member of Lubmarine - a worldwide organization specialized and dedicated to marine lubricants fully integrated from product development, supply chain, marketing and sales. It is present in 100 countries where each company member follows strictly all the procedures that concern technical, performance and safety. Lubmarine provides the shipping industry with the best marine lubricants and greases, associated with first-class service. Galp produces the right lubricant to your ship and supplies at the right port. If you require bunkers in Portugal or Spain then just contact us at Galp. We look forward to receiving your call.

+351 217 240 654 +351 217 240 952 bunkers@galp.com galp.com

World Bunkering SUMMER 2019

Captain Laval Lam Kai Leung Operations Manager llamkaileung@dcplpro.world

Marine & Cargo Surveyors Shipping Consultants

e Chermont & Partners Ltd is one of the leading Marine & Cargo Surveying firms in Mauritius, operating since 1989. Originally started in 1973 by Captain Daniel de Chermont, Master Mariner, with a season staff of Senior Marine Surveyors, De Chermont & Partners Ltd was formed following the passing of its founder in 1989. The company has been a pillar of the Marine and Cargo Surveying business and shipping consultant in Mauritius since that time, serving clients locally and internationally. We offer a wide variety of services and our entire staff of surveyors are eager to assist customers with all of their needs.

Advertising THE OFFICIAL MAGAZINE OF IBIA

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New advertisement opportunities and discounts for IBIA members! please contact Alex Corboude for details - alex@worldbunkering.net

COMPANY NEWS

DE CHERMONT & PARTNERS LTD

+230 2121848 or +230 2124949 (Tel) +230 2101278 (Fax) web@dcplpro.world

NEW MEMBERS INDIVIDUAL Shipowner Frank Dahan Group CSL Inc America Trader Christoffer Ahlqvist Vopak Europort Terminal B.V. Europe Supplier, Trader Manoj Tandon Adani Global Pte. Ltd. Asia Broker Joe Wallace Nautical Supply International Ltd Europe

Trader Derron. W. Tan ZenRock Commodities Trading Pte Ltd Asia Supplier Fernando del Valle Pan American Energy, S.L., Sucursal America Supplier, Broker Zach Stansbury GCC Bunkers America

Supplier William Goldsmith Prema Energy Europe Broker, Trader Anuradha Harasgama Stralight Shipping Australia PTY Ltd Asia Shipowner, Charterer Justin Murphy ADNOC Middle East

Supplier Jeff Hickson Caltex Australia Petroleum PTY Ltd Asia

World Bunkering SUMMER 2019

21 – 22 MAY 2019

MARITIME AND TRANSPORT LAW CONFERENCE: OPPORTUNITIES AND RISKS IN SHIPPING IN 2019 OSLO, NORWAY This conference, presented by the International Bar Association (IBA) Maritime and Transport Law Committee, is taking place 21-22 May 2019, Grand Hotel, Oslo, Norway. Topics include: Financing maritime ventures, Maritime insolvency and restructuring – offshore, IMO sulphur emissions limits – just around the corner, The new era of compliance in the shipping industry – anticorruption and sanctions, Marine insurance, Maritime claims against governments and Vessel scrapping – may she rest in peace (or pieces). https://www.ibanet.org/Conferences/conf955.aspx

28 – 30 MAY 2019

IBIA AFRICA CONFERENCE 2019 CAPE TOWN, SOUTH AFRICA

DIARY 10 – 13 SEPTEMBER 2019

IBIA CARIBBEAN CONFERENCE HOSTED BY THE MARITIME AUTHORITY OF JAMAICA MONTEGO BAY, JAMAICA The IBIA Caribbean Conference hosted by the Maritime Authority of Jamaica (MAJ), will be IBIA’s second conference in Caribbean and it will take place in Montego Bay, 10-13 September. Last year’s conference created tremendous value not only in relation to the bunkering industry; it also offered opportunities to engage with a range of ancillary services to the global shipping industry as Jamaica is striving to become a major maritime centre in the Caribbean. Prior to the Conference, IBIA will offer an educative platform to the local maritime stakeholders through our Bunkering Training course. During the conference, the IBIA and MAJ partnership will create a tremendous opportunity for local and international players to interact and discuss future investments.

The 4th IBIA Africa Conference returns to Cape Town, South Africa where the first IBIA Africa Conference was held in 2015. It will include a full day of training and 2 days of conferencing where we will share vital information and unpack legislation following the last meeting of the IMO’s Marine Environment Projection Committee prior to the global sulphur cap taking effect. IBIA’s Director and IMO Representative, Unni Einemo, will be joined by international and local experts in fuels, shipping, port authorities and regulators in an engaging and much anticipated forum.

22 – 24 OCTOBER 2019 IBIA ANNUAL CONVENTION 2019 ISTANBUL, TURKEY

3 JUNE 2019

DNV GL CONFERENCE SUPPORTED BY LLOYD’S LIST TURNING POINT: ENTERING THREE DECADES OF FUEL TRANSITION OSLO, NORWAY With the Global 2020 Sulphur Cap on the doorstep and the implications of the IMO GHG strategy on the horizon, the maritime community is at a turning point. Operators face big decisions on how to make their fleets compliant with upcoming regulations and keep them safe. At this year’s DNV GL Conference at Nor-Shipping, we come together with the most important industry stakeholders to offer guidance on the most important questions surrounding the Global Sulphur Cap and alternative fuels.

IBIA has arranged a dynamic series of sessions in diverse topics which will cover a broad spectrum of issues, with emphasis on the future challenges facing the bunker and shipping industry. We will also have exclusive social events for our delegates. The IBIA Annual Convention will take place at the Ciragan Palace Kempinski, an Ottoman Imperial Palace and hotel on the banks of the Bosphorus in Istanbul, Turkey. www.ibiaconvention.com

18 JUNE 2019

IBIA & UK CHAMBER OF SHIPPING: SULPHUR 2020 COUNTDOWN: WHAT YOU NEED TO KNOW LONDON, UK IBIA and the UK Chamber of Shipping will join forces for a half day Conference at the premises of the UK Chamber Shipping, in London, on 18 June, to discuss the IMO 2020 Sulphur Cap, the socalled a once-in-a-generation disruptor to shipping’s commercial environment. This conference takes place less than six months before the new regulation takes effect and just after the IMO meeting where pending issues are expected to be finalized. It will cover topics related to availability, enforcement, handling of new fuels, reporting of compliance issues and mitigation of safety issues, fuel disputes, scrubber installations and discharge of open loop wash water. We have designed this conference to help shipowners get up to speed on everything they need to know to ensure compliance with the regulation. It will also provide the opportunity to those attending to exchange views on challenges and how others are preparing.

World Bunkering SUMMER 2019

13 – 15 NOVEMBER 2019

IBIA - AMERICAS GAS AND POWER SUMMIT PANAMA IBIA is the official partner of the Americas Gas and Power Summit. The conference will take place in mid-November 2019 in Panama, the regional hub for global for LNG and Energy. It has been developed as a platform for gas and power cooperation in the Americas with the participation of key regional and international stakeholders along the entire gas value chain. www.americas-gasandpower.com

WORLD BUNKERING

AUTUMN 2019... NOW OPEN FOR BOOKINGS

SPECIAL FEATURES:

GEOGRAPHICAL FOCUS:

Independents

Black Sea

Fuel Quality

Americas

In a rapidly changing bunkering scene the independents have been going through tough times. Will they will they be able to adapt to a more complex marine fuel scene?

Last year saw a spate of quality issues. There are fears that more may occur when the 0.50% sulphur in fuel limit is implemented. Should we be worried? How do we prepare?

To coincide with IBIAâ&#x20AC;&#x2122;s Annual Convention 2019 in Istanbul we are taking an in-depth look at the bunkering sector in Turkey and also the other Black Sea countries.

North American bunker suppliers and ship operators have now had several years of ECA experience. What will the implications be for the rest of the Americas when IMO 2020 comes into force?

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ibia@constructivemedia.co.uk World Bunkering SUMMER 2019