World Bunkering - Special Edition 2011 by Maritime Media

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SPecial EDITION 2011

Bunkering SPECIAL EDITION Barcelona Convention

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l IBIA ponders sulphur cap policy l Russian inland waterway bunkering l Black carbon challenge

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World

AMERICAS supplement 2010

Bunkering SPECIAL EDITION

Publisher: W H Robinson Editor: David Hughes (anderimar.news@googlemail.com) Sales Manager: Taj Oberai (taj.oberai@mar-media.com) Project Manager: Dawn Barley (dawn.barley@mar-media.com)

The views expressed in IBIA Annual Convention Special Edition 2011 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. IBIA Annual Convention Special Edition 2011 is published by Maritime Media on behalf of IBIA.

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World Bunkering Special Edition IBIA Annual Convention 2011

Editor’s letter

David Hughes

his special IBIA Annual Convention issue is intended to provide some food for thought for delegates attending the bunker industry’s big event. As well as giving an overview of the issues being tackled this year, our Welcome to Barcelona (p9) has a few tips on how to enjoy this fascinating city. True, there is plenty of the serious stuff taking place at our temporary home from home, the magnificent Hotel Rey Juan Carlos I, but it would be a great shame to leave without having at least sampled the unique atmosphere of the world-famous La Rambla. The two main themes of this issue, in different ways, both add context to our gathering. We take a look at what has already been agreed at IMO, in terms of technical measures to reduce the industry’s “carbon footprint”, and thus do our bit to combat climate change. Pressure is, however, building on the shipping industry, ahead of December’s UN Framework Conference on Climate Change (UNFCCC) in Durban, for global shipping to contribute to a “green fund”. The Director General of the Norwegian Shipowners’ Association, Sturla Henriksen, sets out his Point of View (p16) about how any marketbased measure (MBM) – to use IMO terminology – should work. He argues strongly for a single global system; within IMO, that ensures a level playing field for both the shipping industry and its competitors. As with many in the shipping business, Mr Henriksen believes that revenues generated should be directed back to the shipping industry to spur innovation. Justifiably shipowners see the MBMs as a temporary incentive scheme that should spur the industry to massively reduce its carbon emissions. That would be nice but perhaps the mood of the times can be seen more clearly from a recent joint Oxfam/WWF paper that called for a US$25 per tonne “carbon price” on bunkers which, it claimed would raise $25 billion a year. We set that report against the mainstream industry views in Setting the scene (p12). For many in the “Green” movement shipping is mainly of interest as a convenient provider of funds. Just as we, as an industry, thought we had grasped the fundamentals of the climate change debate a joker has sprung out of the pack. It now appears that black carbon, or more prosaically “soot”, could be the real villain of the piece when it comes to global warming. Our Technical page reports on the new American research (p44). Standby to hear a lot more in the coming months about how black carbon is the big threat to the Arctic Ice Cap, and how extracting soot from emissions streams could become the top, and very urgent, priority. We are not forgetting, however, that we are meeting this year in a major Mediterranean bunker port. So our geographical focus is on this important region and we put the spotlight on a number of bunkering centres. As always at IBIA Conventions the World Bunkering team will be on hand. This is a valuable opportunity for me as editor to find out first-hand what is really going on in the industry. For IBIA members this is also a chance to tell us what you think about your magazine. I will either be sitting in the convention hall frantically taking notes, mingling with members during our numerous networking opportunities or be available at the IBIA stand. I look forward to meeting as many IBIA members, old friends and new, as possible.

Contact: Shazmeer Jiwan Alba Petroleum Ltd PO Box 97155 Mombasa, Kenya Tel: +254 41 2317001/2/7/8/9 Fax: +254 41 2317006 +254 41 2317010 Mobile: +254 720 630000 or +254 721 786310 E-mail: sales@albapetroleum.com

World

Bunkering SPECIAL EDITION

Editor’s letter David Hughes

IBIA Chairman’s introduction Bob Lintott

Chief Executive’s report Trevor Harrison

Welcome to Barcelona

Gala success

Setting the scene

Moving forward on MBMs

Barcelona process protects the sea

Small but influential

Monaco 20 Spain

Bouncing back

Ceuta: growing in size

Tough decisions ahead Looking for low sulphur Long term optimism Hard times

Gibraltar 28 Italy 33 Malta 35 Greece 37 35

Russian update

An ethical approach on the Volga

Sooty threat to ice cap

Chairman’s introduction

elcome to the lovely city of Barcelona. We’re looking forward to the most productive, most interactive and best-attended

IBIA event to date. Since I wrote my last Chairman’s introduction, Ian Adams, our former Chief Executive has tendered his resignation to the Board and, although we were sorry to see him leave, his departure has been a wake-up call for your board members! We’re very grateful to and would like to thank Trevor Harrison who kindly volunteered to sit in as our Acting Chief Executive on a part-time basis. You will see his contribution in the next few pages. Our thanks also go to Ian for the very valuable work he did as Chief Executive of your organisation. We will be looking to fill the gap left by Ian in due course. The rest of your Board (including Trevor, who is also a board member and now temporarily wears two hats) has necessarily been far more involved in the activities and decision making of our Secretariat. This is a good thing and has led to some interesting, lively discussions and rather more board conference calls than hitherto. We are a diverse group of people, drawn from all aspects of our industry. We’re also truly international – and scheduling telephone conferences at times that suit Bombay, Europe, Singapore and The Americas can sometimes be a challenge – particularly

if we really expect wakeful and valuable contributions from the participants! We know you will find this year’s IBIA Convention enjoyable and, we hope, productive. It’s a great forum for meeting and greeting and, as usual, we’re most grateful to our many sponsors for their kind and generous contributions towards making it all happen. To be here in this beautiful city is a first for me and a real pleasure. Some of your present board members will shortly come to the end of their elected terms of office and we shall all soon be voting for their successors. Please use your vote when the time comes. In future years we shall again be looking to the Membership for fresh candidates and perhaps you would then feel it is your turn to run for election. We would also like to hear your proposals for suitable city venues for future IBIA Conventions. If you would, please take the time to tell us where and, possibly just as important, why you propose the location you favour. Please keep in mind that it must be situated near an international airport of some substance and be reasonably accessible to our members. As you will see, we have selected Dubai as the venue for our 2012 Convention and this meets the access criteria whilst breaking new ground for IBIA. As always, your Board would like to encourage your input. We’re very interested to learn what our Members think,

World Bunkering Special Edition IBIA Annual Convention 2011

Bob Lintott

how we might improve, your likes and dislikes about the organisation and anything innovative you feel we might explore. You can contact board members individually or through the Secretariat and we look forward to hearing from you. On behalf of the entire Membership, I’d like to thank our Secretariat in general and Charlotte Egan and Chanette Roughton in particular for all the hard work that has gone into arranging this event. May it be successful, enjoyable and may you take from it a resolve to communicate more frequently with your Board and, who knows, maybe even stand for election and become a board member yourself? Most of all, we hope that you will take advantage of the relaxed environment in which to meet and greet, and participate in the various events and attend the talks that have been arranged. Last, but far from least, thank you to all our speakers. From one who dreads standing before an audience as the focus of attention, I at least appreciate the work that goes into producing and delivering a paper. The ease with which I see others do this amazes me. Good luck with your presentations, may they be as well received as they are constructed and delivered. Gracias y saludos!

Bob Lintott

Oil Marketing

& Trading International (Europe MARINE FUELS

in UAE

and now

in CEUTA - Spain 14 Tzavela str. 166 74 Glyfada ATHENS GREECE TEL: 0030 210 96 09 860 FAX: 0030 210 96 09 861 TELEX: (0510) 94078550 OMTI G E-mail: bunkers@oil-marketing.com Web: www.oil-marketing.com

Office 2001, Saba Tower 1, Jumeirah Lakes Towers, Dubai, United Arab Emirates TEL: +971 44350500 FAX: +971 44350505 E-mail: bunkers@oil-marketing.com

Chief Executive’s report

Welcome to Barcelona and to the 2011 IBIA

Trevor Harrison, Acting Chief Executive Tel: +44(0) 23 8022 6555 Fax: +44(0) 23 8022 1777

Annual Convention. Future conventions

The Secretariat

It has long been IBIA policy to move the Annual Convention between venues in the Americas, Europe and the Asia Pacific region at roughly equal intervals. In 2009 we were in Singapore, last year we went to Connecticut and this year we are in Spain, the idea being to make it easy for every member to attend at least once every three years. Over the summer, the Board, assisted by Events Manager Charlotte Egan, engaged in some lively discussions about whether we should make changes to the above arrangements and if so what these might be. We considered a wide range of options, including rotating between three regular venues and varying the convention dates; eventually, after much debate, we decided to adopt the following broad principles: • We will maintain the current practice of moving between the three continental areas of Europe, Asia-Pacific and the Americas. • The event will be held in the first week of November. • We will try to avoid clashing with other relevant events in the same region; fixing the dates makes it easier for other event organisers to avoid inappropriate overlap. • The destination city will ideally be selected 18-24 months in advance. • We will not generally return to the same city unless there is a special reason. • Ease of access for members will be an important criterion in selecting venues; this includes both transport links and administrative issues such as obtaining visas. • The convention will open on a Wednesday afternoon and conclude at lunchtime on the following Friday. None of the above provisions are set in stone and the Board welcomes your comments and suggestions about these principles and, indeed, about all other aspects of the convention as well. Putting the above principles into action, for 2012 the Board has chosen Dubai as the convention venue with a provisional starting date of Wednesday 7 November. We very much hope to see you there.

By the time you read this I will have been part-time Acting Chief Executive for about three months and very busy months they have been. As an organisation we have been fortunate to have long had a lean, loyal, efficient and hard working Secretariat in Southampton and Singapore. I have every confidence that this will continue and look forward to the future when I will be able to hand my temporary responsibilities on to a permanent successor. With this in mind, your thoughts and suggestions about how you think the Secretariat should operate will be welcomed by all the present Board. Please share your thoughts with us.

World Bunkering Special Edition IBIA Annual Convention 2011

The Board

Born as much out of necessity as choice, the past few months have seen the whole Board taking a much closer interest than previously in the day to day workings of the association with very positive results. Staff morale is high and the resulting culture of openness has been enthusiastically embraced by Board and Secretariat alike even though the need to communicate and explain, often more than once, inevitably increases individual workloads. The future

IBIA is a members’ organisation and it therefore exists primarily to serve its members. It is not always easy to reconcile conflicting interests; we try our hardest but the reality is that we can only succeed if we have your input, so please talk to us; talk to us today here in Barcelona, and keep talking to us afterwards when we have all gone home. Better still, stand for election as a Board member and help run the organisation yourself or take the initiative and set up a local IBIA branch, the Secretariat is here to help. The world of bunkers and bunkering is never dull and IBIA is at the heart of the industry, be part of it. Enjoy the next few days and I wish you all a successful year until we meet again next November in Dubai. Trevor Harrison Acting Chief Executive and elected board member

www.ciinternationalfuels.com

No. CO232317

Welcome to Barcelona As David Hughes reports, this year’s IBIA Annual Convention will not only be an

opportunity to get up-to-date with the latest developments in the industry, but also a chance to explore one of Europe’s most vibrant cultural centres.

packed three-day event awaits delegates to the IBIA Annual Convention at Barcelona’s Hotel Rey Juan Carlos I from 2-4 November. From a business point of view, speakers and delegates from all parts of the bunkering scene – shipowners and operators, suppliers, traders and brokers, service providers and legislators – have a wide-ranging agenda. Among the topics up for discussion will be: the impact on the bunker industry of the 0.1% 2015 Emission Control Areas; the effects of increased demand for MGO on bunker prices and availability in Europe; implications for the bunker industry on a shift to LNG fuelled ships; and the outlook for Europe, the Americas and Asia. The conference will be chaired by Bob Lintott, Managing Director of ISO Bunkers and IBIA Chairman, with over 40 years’ experience in the marine fuels industry in the UK and USA. He says: “With 2015 looming, this convention is an opportunity for the industry to discuss how best to deal with the major challenges that lie ahead for all of us. The focus of our convention will be the impact of legislative change and the way forward for the bunker industry. We have lined up a strong programme of speakers, including senior representatives from EMSA, ECSA, Chemoil, World Fuel Services, Stena and Carnival, to name but a few. We very much look forward to welcoming the industry to Barcelona.” The venue, Hotel Rey Juan Carlos I, opened its doors just days before the 1992 Olympic Games, held in the city; since that exciting time in the city’s history, they have expanded and improved this Barcelona resort hotel. The convention features a strong social programme, starting with a Welcome Reception on Wednesday evening. On the following evening there is a Gala Reception and three-course dinner on the 41st and 42nd floors of the spectacular Hotel Arts, which promises

World Bunkering Special Edition IBIA Annual Convention 2011

“a culinary Spanish experience, excellent networking opportunities and the chance to view Barcelona at night from a great height”. A farewell lunch with wine tasting on Friday will round off the industry gathering – a last chance to pick up those business contacts, and progress new ideas with fellow delegates at the IBIA Annual Convention. Hopefully, most delegates will also get the chance to see the city at closer quarter. It is certainly worth spending some time exploring. Barcelona. Sited between the sea and the mountains, it enjoys the reputation of being the most cosmopolitan and modern city in Spain since its rejuvenation for the Olympic Games. It is also famous for its stunning traditional and avant-garde architecture. While Spain has experienced a particularly hot summer this year, by November temperatures should be much more comfortable, somewhere around 18°C. This should allow for pleasant strolls along La Rambla, the world famous 1.2 km-long, partially pedestrianised, street which runs through the heart of the city from the port. Attractions on La Rambla include live performances, human statue art and caricature artists. There are many cafés with open air seating to allow you to take in the sights. The guidebooks do, however, advise caution when walking around the southern part of the Ramblas at night. There is plenty of detailed information on the internet; www.barcelona-tourist-guide.com is worth looking at – particularly for its advice on using the excellent public transport system, which includes the Metro. The nearest metro to the hotel is Zona Universitària, about 10 minutes away. If you are able to make more than just a couple of trips out it is worth considering buying a T10 ticket or a transport and discount card. Enjoy!

Gala success

IBIA inaugural Asian events exceed expectations.

he first IBIA (Asia) Gala Dinner and Golf Challenge, took place in Singapore on 2 September. The Golf Challenge was held at the Warren Golf and Country Club and was open to IBIA members and guests. The competition was keen and Michael Goh came away with the Gross Champion Trophy and a Callaway Diablo Octane driver as his prize. The golf was followed the same day by dinner at the Raffles Hotel with Singapore’s Minister, Environment and Water Resources, Vivian Balakrishnan as guest of honour. IBIA’s Regional Manager – Asia, Kwok Fook Sing, said “The event was a great success with over 200 people attending the dinner. IBIA would like to thank Dr Vivian Balakrishnan for honouring our event with his presence and for delivering a highly topical speech.” Mr Kwok added: “We would also like to thank our sponsors whose generosity enabled these events to get off to such an auspicious start.” The Golf Challenge and Gala Dinner was sponsored by DNV, Mogas Flow Lab, Seven Seas, Golden Island, KPI Bridge Oil, Vitol, Searights and Lloyd’s Register.

Singapore’s Minister, Environment and Water Resources, Dr Vivian Balakrishnan making his speech

At the Guest of Honour Table: anti clockwise; Minister Dr Vivian Balakrishnan, Simon Neo, Capt Segar, Capt Tey Yoh Huat, Mr Chong Kam Wah, Mr Douglas Raitt, Mr Daniel Phua, Mr Bob Lintott, Mr Eirik Andreassen

World Bunkering Special Edition IBIA Annual Convention 2011

Mr Chong Kam Wah receiving his Honorary Membership Certificate from IBIA Chairman, Bob Lintott

Guestsâ&#x20AC;&#x2122; Flight From Left, Daniel Phua, Vice Chairman, IBIA Asia, Captain M Segar, Group Director, Hub Port Cluster / Director, Port Division, Mr Alvin Lim, Director, Sea Transport Division, Ministry of Transport, Mr Ronnie Yeo, Managing Director, Fratelli Cosulich Bunker (S) Pte Ltd

Keen and competitive players at the Golf Challenge

World Bunkering Special Edition IBIA Annual Convention 2011

Setting the Scene

Setting the scene

his year’s Convention comes at a time when important environmental issues are reaching crucial stages and will be the focus of much of the bunker industry gathering’s proceedings. While the programme covers a wide range of topics of interest to the industry, two are especially important right now: the shipping industry’s efforts to cut greenhouse gas emissions and the challenges posed by the 2015 implementation of the 0.1% sulphur cap in the Emission Control Areas. This special World Bunkering background briefing is intended to provide some additional insight into these main issues, which are likely to be the subject of intense discussion. Greenhouse gases

Moving towards an effective practical response to the need to reduce the global shipping industry’s carbon footprint, and thus contribute to countering global warming, is proving to be a difficult and complicated process. The shipping industry has more or less now adopted a common approach to what it would prefer to see put in place (if anything): a levy-based system as opposed to emissions trading, although the UK Chamber of Shipping is still sitting on the fence. The International Maritime Organization (IMO) has managed to put together a package of technical measures. It has, however, found it difficult so far to reconcile its fundamental policy that shipping regulations should apply equally to all vessels of all flags, with the Kyoto Protocol, which enshrines the principle of “common but differentiated responsibilities” when it comes to agreeing to a regime of financial incentives to reduce carbon emissions, the so-called “market-based measures” (MBMs). There is, nevertheless, unanimity in the shipping community that any MBM system should be developed and implemented by the IMO. Despite this, it is by no means certain that the United Nations Climate Change Conference (UNCCC), in Durban this December, if it agrees anything at all, will necessarily take shipping’s views in to account. Loud voices are pushing for global shipping to be seen as a revenue source for funding much more than technical measures to reduce shipping’s carbon profile.

Meanwhile the scientists have produced a joker in the pack on global warming – black carbon (see Technical, p44). While the world’s politicians are focused on reducing CO2, it is beginning to look as if the most effective, and urgently required, action to slow global warming, and in particular the melting of the global ice caps, may be to reduce black carbon emissions. Returning to what for now remains the prime preoccupation of politicians and shipping administrations, IMO’s Marine Environment Protection Committee (MEPC 62) agreed, in July, mandatory measures to reduce emissions of greenhouse gases (GHGs) from international shipping, despite opposition from some developing countries who wanted explicit reference to the Kyoto Protocol of “common but differentiated responsibilities”. IMO said this was the first ever mandatory global greenhouse gas reduction regime for an international industry sector. Amendments to MARPOL Annex VI Regulations for the prevention of air pollution from ships add a new Chapter 4 on Regulations on energy efficiency. It makes mandatory the Energy Efficiency Design Index (EEDI) for new ships and the Ship Energy Efficiency Management Plan (SEEMP) for all ships. Other changes add new definitions and the requirements for survey and certification, including the format for the International Energy Efficiency Certificate. For some campaigners, however, the technical measures did not go far enough. The Richard Branson-founded Carbon War Room delivered a letter to IMO delegates calling for the mandatory use of energy efficiency ratings across the entire fleet, signed by 50 organisations, including owner-operators of 60 million tonnes’ worth of vessels. Signatories included Denmark’s Maersk Line and Torm, Canada’s Teekay, America’s Heidmar, and Wallenius Wilhelmsen Logistics (ro-ro) of Norway/Sweden. German consumer electronics company Schneider Electric has also signed, along with the Port of Los Angeles and the NGO, Forum for the Future. Peter Boyd, Carbon War Room’s chief operating officer, said that the new standards, if applied to all ships and not just newbuilds, would save the industry more than 220 million tonnes of CO2 and US$50 billion a year. He added: “This is an historic move by the IMO

World Bunkering Special Edition IBIA Annual Convention 2011

but there’s a bigger environmental and economic opportunity out there that’s too good to miss.” IMO stressed that the EEDI is a non-prescriptive, performancebased mechanism that leaves the choice of technologies to use in a specific ship design to the industry. As long as the required energyefficiency level is attained, ship designers and builders would be free to use the most cost-efficient solutions for the ship to comply with the regulations. The SEEMP establishes a mechanism for operators to improve the energy efficiency of ships. MARPOL also now includes a regulation on the promotion of technical cooperation and transfer of technology relating to the improvement of energy efficiency of ships. It requires governments, in cooperation with IMO and other international bodies, to promote and provide, as appropriate, support directly or through IMO to states, especially developing states, that request technical assistance. The regulations apply to all ships of 400 gross tonnage and above and are expected to enter into force on 1 January 2013. However, under Regulation 19, the Administration may waive the requirement for new ships of 400 gross tonnage and above from complying with the EEDI requirements. This waiver may not be applied to ships above 400 gross tonnage for which: the building contract is placed four years after the entry into force date of chapter 4; the keel of which is laid or which is at a similar stage of construction four years and six months after the entry into force; the delivery of which is after six years and six months after the entry into force; or in cases of the major conversion of a new or existing ship, four years after the entry into force date. However, in September the International Chamber of Shipping (ICS) took a policy stand and declared that “no responsible shipowner would want to order a new ship (that was covered by the new IMO regulation) without an EEDI, since this would almost certainly impact on its ability to trade”. An ICS statement said its board of directors considered the “theoretical right” of flag states to issue waivers to shipowners taking delivery of new ships, which had been agreed by IMO for political reasons in order to allay concerns amongst developing nations. ICS chairman, Spyros M Polemis, said: “As a signal of good faith and commitment to the uniform global implementation of the IMO agreement on CO2, ICS strongly recommends that all ships of a type for which the index has already been agreed should be delivered by shipyards with an EEDI – regardless of any flag state waiver that might be available for a limited time.” The ICS statement expressed “great satisfaction” with the adoption in June, by the IMO, of a package of technical regulations to help the shipping industry further reduce its CO2 emissions on a global basis. ICS said that it hoped that now that IMO had adopted binding regulations that will enter into force in 2013, this would be sufficient to dissuade governments from pursuing detailed CO2 rules for shipping at the UNFCCC or through regional requirements, for example by the EU. It added: “Such alternative measures would only be likely to apply to a proportion of the world fleet and would therefore deliver far smaller total emission reductions than global measures agreed through IMO. Such alternative measures would also fundamentally upset the global level playing field that the shipping industry needs to carry world trade efficiently.” At odds with the views of most other national shipping associations, the UK Chamber of Shipping has urged the international shipping industry to keep the door open on all options to drive a reduction of its carbon emissions. It welcomed IMO’s technical measures but in a statement said it believed that it will prove necessary for the industry to go further – through the adoption

World Bunkering Special Edition IBIA Annual Convention 2011

of economic (or ‘market-based’) measures to meet governments’ expectations and targets. The statement said: “International opinion is divided on the best model for reducing the shipping industry’s carbon emissions. Some support the idea of a greenhouse gas contribution fund, in which shipping companies would contribute as part of purchases of bunker fuel. Others prefer an emissions trading system (ETS), in which shipping companies would buy a shipping allowance or ‘emissions unit’, which they would then surrender according to their actual carbon emissions.” The ICS director of external relations, Simon Bennett, told World Bunkering that the vast majority of national shipping associations within ICS supported the policy adopted by the organisation earlier this year and that its preferred option would be some form of levy. It is understood that, within ICS, the UK Chamber was the only national shipping association representing a significant amount of tonnage that did not support the preference for a levy. The UK Chamber has, however, shifted from the position adopted in 2009, when it issued a statement headlined “Shipping industry supports emissions trading to reduce CO2”. Now it has published two ‘manuals’ on the main options. However, the ICS has proceeded to lobby hard for a levy, if MBMs are to be introduced, and against an ETS. It sees the EU position as being potentially crucial at Durban. Its chairman, Spyros M Polemis, has written to the European Commissioner for Climate Action, Connie Hedegaard, urging the EU to support a compensation system linked to fuel consumption, or levy, rather than an emissions trading system for shipping. ICS believes that a 20% reduction in emissions per tonne of cargo moved per kilometre is a realistic target that could be met by 2020, to a large extent driven by the introduction of Ship Energy Efficiency Management Plans (SEEMP). The ICS president was not, though, alone in lobbying the EU this summer. Oxfam and WWF were pushing the idea that a proposed deal to apply a “carbon price” to international shipping should be at the heart of the agreement at the UN climate change conference in Durban, South Africa, later this year. Publication of a report by the two NGOs was timed to put pressure on EU Environment Ministers at their meeting in October. Oxfam and WWF say that EU support for the proposal will be critical to breaking the international deadlock on shipping emissions that has lasted more than a decade. The new joint report claims that applying a carbon price of US$25 per tonne to bunkers would help cut emissions while generating $25 billion per year by 2020. According to the NGOs, the cash generated would be used both to compensate developing countries for marginally higher import costs that could result from the carbon price, and to provide more than $10 billion per year to the Green Climate Fund (GCF). The GCF was established at last year’s UN climate conference in Cancun, Mexico, to channel funds for tackling climate change to developing countries, but is currently empty. The two organisations say that the EU could “broker a deal to tackle the huge and growing greenhouse gas emissions from ships and raise billions of dollars to help developing countries tackle climate change, without unfairly hitting their economies”. The report, Out of the Bunker – Time for a fair deal on shipping emissions, says the carbon price would only increase the costs of global trade by 0.2% – equivalent to just $2 for every $1,000 traded. South Africa, whose import costs are projected to increase by 0.14% as a result, would receive compensation of approximately $200 million per year, while Bangladesh, whose import costs are projected to increase by 0.19%, would receive $40 million per year, in addition to any revenues received from the GCF. Oxfam and WWF argue that

this money should be spent building the resilience of the poorest and most vulnerable people in each country. Oxfam and WWF say: “The EU will be critical to brokering such an agreement. More than a decade of deadlocked discussions to reach a global agreement on aviation emissions led the EU to unilaterally include flights in and out of Europe in the EU Emissions Trading Scheme. “With that system poised to take effect in January, the Oxfam/ WWF proposal calls for the EU to seize the opportunity presented by heightened awareness over international transport to push for a fair global deal on shipping that addresses all emissions from the sector, and does not unfairly hit the economies of developing countries. Coordinated EU leadership on this issue is needed ahead of the Durban conference.” Tim Gore, Oxfam policy advisor on climate change and co-author of the report, says: “Our research shows it is possible to cut the massive greenhouse gas emissions from shipping without unfairly hitting developing countries, and to generate billions of dollars in new cash for climate action in poor countries in the process. The costs are affordable but the benefits for the planet and those most vulnerable to climate change are huge. It’s time for shipping to become part of the solution to tackling climate change, not a big part of the problem.” While the report does make some brief mention of IMO, it is far from a clear endorsement of the need for IMO involvement. Moreover, its focus on generating revenues for “climate action in poor countries” reinforces the initial concerns in the shipping industry that it would be seen as a convenient cash cow to subsidise any UNFCCC deal.

Sulphur

Two key deadlines, in 2015 and 2020, are causing considerable concern throughout the global shipping industry. As ICS notes, IMO adopted radical amendments to MARPOL Annex VI governing atmospheric pollution in 2008. For most ships these regulations will ultimately require the use of more expensive low-sulphur (primarily distillate) fuels, although there is an increasing focus on both abatement technologies that would allow continued use of residual fuel, and also on alternative fuels, especially LNG. Explaining the 2008 decision ICS says: “At the time, ICS welcomed the IMO agreement as an acceptable compromise, although this was in the context of the even more draconian proposals that were then being proposed by many governments and, most importantly, the public threat by the EU to impose an immediate regional solution if IMO was unable to deliver a global agreement.” “But,” ICS cautions, “the implementation of the new requirements will be far from easy, and ICS remains in close dialogue with oil industry analysts about the progress that is being made to ensure that the demand from shipping for distillate fuel can be met.” A new report, Outlook for Marine Bunkers and Fuel Oil to 2030, by Robin Meech and analysts FGE says that implementing the IMO sulphur limit proposals by 2020 would be “virtually impossible”, requiring the refining industry to invest in more than 4 million barrels per day of extra secondary processing capacity, above that already scheduled. Its findings add to a growing industry perception that abatement technology will be increasingly attractive. It concludes that under pressure from the impending marine emissions legislation, the mix of fuels used in the shipping industry will proliferate, and that onboard scrubbing will become viable, initially for vessels operating in ECA areas, but subsequently for all newbuilds. © All rights reserved by imo.un

IMO currently has 169 Member States and three Associate Members

World Bunkering Special Edition IBIA Annual Convention 2011

ICS says that perhaps the most controversial requirement in MARPOL Annex VI concerns the need for ships operating in Emission Control Areas (ECAs) to burn fuel with no more than 0.1% sulphur as from 2015. At present, the Baltic, the North Sea, and the entire West and East coasts of the US and Canada have been designated as ECAs by IMO, at the request of the governments concerned. ICS notes: “The considerable task facing the oil refiners, which must expand the production of low-sulphur fuel to meet the new demand, is complicated by the fact that it is not yet fully known which additional areas may be designated as ECAs. It is still unknown if or when EU nations will submit applications for ECAs covering the Atlantic coast or the Mediterranean/ Black Sea, or whether other coastal states in major population centres have plans to follow suit before 2015.” Recent studies suggest that the modal shift to land transport that will probably result from the application of the 0.1% limit in the Baltic ECA could greatly damage local short sea shipping while being detrimental to the environment. Together with the European Community Shipowners’ Associations (ECSA), ICS has therefore endorsed a major study developed by consultants (the ENTEC study) commissioned by north west European national associations, which explains the impact of the implementation of MARPOL Annex VI in the Baltic and the North Sea, and the environmental consequences of the predicted modal shift. ICS has also submitted this report to the IMO Marine Environment Protection Committee for information. At the IMO MEPC meeting in September last year, governments agreed with an ICS proposal that early consideration should be given to a review of the availability of low-sulphur marine fuels. While there is a formal mechanism in the IMO agreement to complete a review by 2018 of progress made towards meeting the demand for 0.5% sulphur fuel that is meant to be used outside of ECAs by 2020, ICS has been pressing IMO to start work now on developing a methodology that can consider all of the major changes required by the new regime. ICS says: “Encouragingly, IMO has established a correspondence group for this purpose, which is being led by the United States and which will report to the MEPC in July 2011. ICS has suggested to the Group that IMO should look at the availability of 0.1% sulphur fuel within ECAs, in order to verify the methodology for the 2018 review of 0.5% fuel that is required by MARPOL.” The problem for the shipping industry, and especially short sea operators in the Baltic and North Seas, is that, despite a growing clamour from industry, and some governments – notably including Finland’s – for a rethink, there is no provision to defer implementation of the 2015 0.1% ECA limit. At its recent annual conference, also in Barcelona, ferry industry representative body, Interferry, made it clear that it believed that the 0.1% sulphur cap could prompt an environmentally damaging modal shift of cargo from ferries to road haulage. Interferry’s executive director of European Union and IMO affairs, Johan Roos, stated: “We need to see if the sulphur regulation can be altered to compensate

World Bunkering Special Edition IBIA Annual Convention 2011

There will soon be pressure on the supply chain for more distillate fuel

for the potential modal shift, and whether it can be delayed or phased in to allow for supply constraints with low-sulphur fuel. At the same time, we also need to consider the options for ferries in dealing with existing and future environmental requirements.” Options ranging from gas-powered ships to scrubber technology featured in several of the conference sessions. Raimon Strunck of Germany’s Flensburger Shipyard described how work on the IMO code can be helped by a research and development project between the yard, gas handling specialist TGE, and engine manufacturer MAN. “The prejudice still exists that a lack of regulations for LNG-fuelled ships makes it difficult to design and construct LNG-fuelled ro-ro and ro-pax vessels but that’s not true,” he stressed. “By extensive use of state-of-the-art risk analysis methods, we have found some very pragmatic solutions for first-generation LNG-fuelled vessels and developed them to ready-for-contract level.” Pursuing another possible option, Per Stefenson of Stena discussed an innovative combination of methanol and di-methyl-ether that he said “may prove to be a technical and economical winner when it comes to retrofitting of existing ships to operate in emission control areas”. The company recently launched a demonstration project with Danish company Haldor Topsoe in which methanol is reformed to DME to power an auxiliary engine – overcoming the problems of using either fuel separately. In addition to hardware development, the project will assess safety procedures for a full-scale ship application. Wärtsilä’s Oskar Levander said that the right choice of fuel and related technology is far from straightforward. “The technically easy solution is just to buy the low-sulphur fuels – no ship modifications are needed – but the cost of these fuels is already very high and expected to increase further as the demand for distillate fuels will increase overnight in 2015,” he warned. He added: “Payback times on scrubbers are short with today’s price difference between MGO and HFO, but there are still only a few vessels that have actually installed them. LNG is clearly the best environmental option but the question is more about the availability and local cost.”

POINT OF VIEW

Moving forward on MBMs Sturla Henriksen, director general of the Norwegian

Shipowners’ Association, argues for a single global system to ensure a level playing field for the shipping industry.

he global shipping industry is both a “precondition and a derivative” of global economic growth, Sturla Henriksen told delegates at October’s International Chamber of Shipping (ICS) conference held in London. The Norwegian Shipowners’ Association (NSA) director general stressed that shipping is a clean and energy-efficient mode of transportation. Moreover, there are already strong commercial incentives for energy efficiency. Backing up this point he said: “Energy consumption for the transport of a loaded container from the Far East to Europe has gone down by 90% since the mid 1970s. Also a platform support vessel newbuilding emits 50% less CO2 than a similar vessel built 10 years ago. Mr Henriksen ran through the IMO framework on tackling the greenhouse gas issue. He noted that IMO had defined nine principal criteria and consequently three categories of measures were under development at the UN agency. These are technical, operational and market based. The first two categories have been addressed by, respectively, the Energy Efficiency Design Index (EEDI) and the Ship Energy Efficiency Management Plan (SEEMP), both of which were agreed by IMO in July. Up to now there has as yet been no agreement on market based measures (MBM), which are intended to act in addition to technical and operational measures to enhance commercial incentives for energy efficiency. Mr Henriksen said: “Our main concerns are that little attention has been devoted to the design of implementation schemes and to the impact on the industry.” He said that the same was true of how different MBMs meet the nine criteria of the IMO. He was also

worried that discussions on MBMs have so far been based on ideological preferences for an Energy Trading Scheme (ETS). He said there was a perception that ETS is the only mechanism to cap emissions. There was also a widespread feeling that shipping must apply the same mechanism as other industries. In May of this year the NSA commissioned PricewaterhouseCoopers (PWC) to investigate the consequences of existing and emerging policies on the reduction of emissions to air from international shipping. Mr Henriksen noted that the study found that both an ETS and a levy system can be designed to ensure the required reductions in emissions, and that both systems can be designed to have an equal economic impact.

World Bunkering Special Edition IBIA Annual Convention 2011

He emphasised: “An important finding is that the differences in efficiency and cost of the systems will be decided by the design of the implementation scheme. This emphasises even more the role and responsibility of the industry to participate actively in the further developments of MBMs.” However, PWC also predicted that sulphur regulations will drive fuel costs to a level that will dwarf the impact of carbon policies. Also the incremental increase in carbon price will drive energy efficiency to a point where currently known technical abatement measures would have been exhausted. Beyond this point, additional costs on shipping may cause modal “backshifts” and reduce shipping’s capacity, resulting in increased overall GHG emissions, reduced global economic growth, and competitive distortions to land-based industries. He noted that ICS expressed a clear preference for a levy-based, “fuel linked” CO2 compensation system. This view was supported by an impact assessment by the Nordic Legal Defence Club, which found that a levy system was better suited to meet IMO criteria, less bureaucratic and easier to administer, more transparent and simpler, and also allowed for the passing on of costs. “I believe,” said Mr Henriksen, “that the way forward is through one, single global system within IMO and based on the following criteria: it must ensure a level playing field within the shipping industry, and with land-based modes of transportation; revenues generated should be directed back to the shipping industry to spur innovation, and there is a need for further in-depth impact assessments on alternative implementation schemes. Finally, ICS should be seen as a major and united player representing the international shipping community.” The Seafarers’ memorial stands guard as delegates from around the world debate the GHG issue

World Bunkering Special Edition IBIA Annual Convention 2011

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Mediterranean Environment

Barcelona process protects the sea

David Hughes looks at SafeMed, a project that brings together Mediterranean countries to cooperate and exchange expertise on key maritime issues, including environmental protection.

inanced by the European Union (EU), the SafeMed II Project is a regional effort to enhance Euro-Mediterranean cooperation in the field of maritime safety and security, prevention of pollution from ships, and marine environmental issues. Its objective is to provide specified Mediterranean countries with the technical advice and support required to ensure more uniform and effective implementation of international maritime conventions and rules, thereby reducing accidents and pollution at sea throughout the Mediterranean region. In 1995 the EU decided to establish a new framework for its relations with the countries of the Mediterranean basin with a view to forming a partnership. This came into being at the 1995 Barcelona Conference, which brought together the Ministers for Foreign Affairs of the then 15 EU member states and the following 12 Mediterranean non-member countries: Algeria, Cyprus, Egypt, Israel, Jordan, Lebanon, Malta, Morocco, the Palestinian Authority, Syria, Tunisia and Turkey. At this conference the foundations of a process designed to build a multilateral framework for dialogue and cooperation between the EU and its Mediterranean partners were laid. A Euro-Mediterranean Declaration established a multilateral framework, bringing together economic and security aspects as well as comprising a social, human and cultural dimension. The SafeMed Project is one aspect of what has become known as the Barcelona Process, and is intended to develop Euro-Mediterranean cooperation in the field of maritime safety and security, prevention of pollution from ships, and marine environmental issues by providing technical advice and support to the non-EU Mediterranean countries. Funded by the EU, the declared objective is to “mitigate the existing imbalance in the application of maritime legislation in the region

World Bunkering Special Edition IBIA Annual Convention 2011

between the EU member states and the Mediterranean partner countries through promoting a coherent, effective and uniform implementation of the relevant international conventions and rules aimed at better protecting the marine environment in the Mediterranean region by preventing pollution from ships”. Explaining the rationale for action on its website the EU says: “The Mediterranean is an important transit corridor for shipping, with 30% of the world’s seaborne trade channelled through it, including 20% of the world’s seaborne oil traffic. Popular destination ports for cruise tourism are, in addition, a key feature of the Mediterranean. This intense shipping activity heightens the risk of accidental pollution and, possibly, illicit discharges, so there is a high need for integrated surveillance of maritime activities and operations as well as a regional focus on implementation of all international regulations dealing with the safety and security of shipping and the protection of the marine environment from ship-sourced pollution. At the present time, illegal immigration and drug trafficking are causes for concern. The project intends to provide elements that will facilitate the development of integrated maritime surveillance in the Mediterranean.” The first SafeMed project (SafeMed I), developed in cooperation with the Euro-Mediterranean Transport Forum (EUROMED) and run in close cooperation with the International Maritime Organization (IMO), ran from 2006 until 2008. SafeMed I was judged to be a success and a second project, initially lasting from 2009 to 2011, established. As was the case for SafeMed I, the project is run by the IMO’s Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (REMPEC). In July this year it was announced that the project’s time frame has been extended until the end of 2012.

Monaco

Small but influential Monaco continues to attract bunker industry players.

he tiny Principality of Monaco is the most densely populated country in the world, with a population of just under 36,000 packed into an area of less than 2km2. It has, however, space for a number of bunker industry companies. Among these is Ocean Energy, which was created in 1985. The company has been able to fully retain its family ownership while expanding to become a large independent global player. It is involved in the physical supply of oil products to the marine and domestic markets. The company says: “Our bunker trading expertise and network is greatly strengthened by our physical positions worldwide.” The company supplies worldwide, either from its own stocks or in association with local contractors under supply contracts, exchange agreements or spot purchases. From its Monaco base Ocean Energy operates a physical supplier at Antwerp, Fos/Lavera, St Petersburg and Singapore.

Another Monaco-based company, Riviera Marine, says on its website that it is “specifically active in providing bunkers for its customers’ fleets around the globe, striving to operate in a discreet, creative and professional manner”. It uses Doubleight’s network of contacts and credit lines with physical suppliers. Dan-Bunkering is a new arrival on the Monaco scene. The major global bunker trader and supplier added Monaco early this year to its network of existing offices in Denmark, Kaliningrad, Shanghai, and Singapore. The company said: “The region is new territory for Dan-Bunkering, and the objective is to strengthen the company’s position in the global bunker market with take-off from Monaco.” After a few weeks of operation Dan-Bunkering announced that the new office had got off “to a great start”. It then launched a recruiting drive for more Monaco-based traders.

World Bunkering Special Edition IBIA Annual Convention 2011

Spain

Bouncing back

After a dip last year, Spanish suppliers’ volumes appear to be back to 2009 levels.

ast year Spain’s bunker industry supplied a total of 6.96 million tonnes, down from 7.47 million tonnes However estimates for this year put the whole year figure at 7.50 million tonnes Asked what are the main challenges facing the country’s bunker suppliers a spokesperson for major Spanish oil company Cepsa said: “The Mediterranean market is very competitive. A good level of service and product quality is absolutely necessary to gain the clients trust. On the other hand, a good supply team is of utmost importance in order to get the necessary cargoes in time and at competitive prices.”

On the issue of downward pressure on margins, she added: “We have seen demand and sales improving this year in comparison with 2010. At the same time, due to difficulties to obtain HSFO in the market, import prices are rising putting more pressure on the supply side. A tough competitive market and a struggling shipping industry in the present economic crisis, all contribute to lower margins.” Cepsa comprises an industrial group employing over 12,000 people, with a presence in Exploration and Production, Petrochemical and Refining and Marketing. It has four refineries in Spain and its bunkering activities are carried out by CEPSA Marine Fuels (CMF), a fully-owned Cepsa subsidiary. CMF has a strong presence in the ports of Algeciras, Barcelona, Ceuta, Gibraltar, Huelva, Las Palmas, Panama and Tenerife. The spokesperson explained the company’s expansion strategy saying: “In 2010, with the objective of offering more alternatives to our clients in the Strait of Gibraltar area, CMF expanded its activities in the Port of Huelva by enlarging storage capacity and putting in place a new barge for bunker operations. In 2011, with the aim of continuing to be the main physical bunker supplier in the strait of Gibraltar, CMF has strengthened its presence at the Port of Algeciras by enlarging bunker storage up to 310,000 cubic metres in a new terminal, which also includes two new lines to load barges to the four already existing. In 2011 as well, CMF expanded its range of products by successfully offering RMK 500 at the Port of Algeciras for big container vessels. CMF continues to look for opportunities to develop new businesses, reinforce existing positions and open new markets in the national and international scene. Looking ahead she concluded: “The competitive scenario is here to stay, with new storage projects in different ports. New players might enter the market and put additional pressure on the existing ones. Only those with enough strength will be able to win the battle and resist in the coming years.” The Port of Algeciras Bay is experiencing a “quite remarkable increase in bunker sales for the last months”, according to a spokesperson, with increase over the same months in 2011 of: May Continued on p24

World Bunkering Special Edition IBIA Annual Convention 2011

Company News

Marine Fuels

CEPSA MARINE FUELS, S.A.

EPSA Marine Fuels, S.A. (CMF) is a fully-owned subsidiary of CEPSA, who leads an industrial group made up of over 12,000 people, with presence in Exploration & Production, Petrochemical, Gas & Power, and Refining & Marketing, with three refineries and a 50% stake of the ASESA asphalt refinery in Spain. The origin of CEPSA goes back 80 years ago, with a long history in the supply of marine fuels since 1929. CEPSA Group is today the leader in the bunkering sector in Spain and Panama and one of the main marine fuels suppliers worldwide. CMF is present in all Spanish ports, as well as in the Strait of Gibraltar, Panama and Malta. The wide range of CEPSA marine fuels are supplied by pipe, trucks or by an efficient barge service, following the strictest quality standards, such as double-hull vessels. In total, CMF operates 13 barges distributed throughout all its ports and terminals. Apart from maintaining a leadership position in these markets, CMF looks for opportunities to expand its international bunkering activities at ports across the world, offering our clients a perfect combination of expertise and enthusiasm. In order to satisfy the needs of its growing customer base, CMF’s supply terminals operate ceaselessly around the clock, seven days a week, all year long. With this level of service, the company has earned a reputation as a fast, effective and reliable company in the supply of fuels to vessels.

CMF Developments

In a constantly evolving and increasingly more complex operating environment, CMF strives to continuously adapt and align itself to new market requirements and conditions. An outstanding example of this is the new developments that the company has gone through during recent years. Even more recently, two great milestones occurred: expansion of CMF’s activities in the ports of Huelva and Algeciras. Last year, taking advantage of the upgrade of CEPSA’s group refinery in Huelva, CMF expanded its activities in the Port of Huelva by enlarging storage capacity and putting in place a new barge. This has made Huelva a port of reference for marine fuels supply in the area of Gibraltar Strait. Since then, and in combination with our operations in Algeciras, Gibraltar and Ceuta, CMF is able to offer more flexibility and time-savings, as this port acts as an excellent alternative for many vessels crossing the Strait. This year, with the aim of continuing to be the main physical marine fuel supplier in the Strait of Gibraltar, CMF has strengthened its presence at the Port of Algeciras by enlarging bunker storage in a new terminal. The new terminal is located right in front of Algeciras anchorage areas C and D at ‘Isla Verde’, included in the newly developed hub that comprises the existing facilities of the TTI and CLH terminals. With these new resources, CMF guarantees bunker supply using 310,000 cu m of storage in the port, and adds two more points for loading barges to the four already existing. These new developments, together with the seven barges in the Algeciras Bay, greatly contribute to CMF’s improved service and flexibility in the Strait of Gibraltar.

CMF in the Mediterranean Barcelona

The Port of Barcelona is a benchmark in the Euromed region, with over 30 terminals able to transport all types of products. The main traffic comprises containerised cargo and high-value goods, such as consumer products, electronic goods and motor vehicles. In addition, this port operates outstanding cruise activity, with 2.4 million cruise passengers travelling through Barcelona every year. The Port of Barcelona is also looking to the future by expanding its facilities to offer a wider range of opportunities for new business and services. In this way, a new berth for liquid bulk carriers and tankers has been built in order to receive larger vessels. As a result of these new developments, bunkering activities have been strengthened, increasing by 13% in the last year. CEPSA Marine Fuels is the main supplier in this port. From an operational point of view, most of the volume that CMF supplies is by barge, although we can also supply by truck. CMF has 50,000 cu m storage capacity for all grades of high quality marine fuels (HSFO and LSFO from 380 cSt to 30 cSt, and MGO 0.10%). Algeciras

The Port of Algeciras Bay is located in an exceptional geo-strategic point, on the crossroads of the world’s main cargo shipping lanes and in the magnificent shelter provided by natural conditions of the Bay of Algeciras. The Port of Algeciras is consolidated internationally as an operational and logistics transhipment centre, being the leader of the Mediterranean in container traffic, which increased 47% during first half of 2011 compared to the same period in 2010. Ro-ro traffic is also fundamental in this port; its strategic location facilitates import and exports all type of products between the continents of Europe and Africa. Furthermore, there is significant movement of liquid bulks, due to the presence of CEPSA Refinery, the annexed petrochemical complex and CLH terminal. This particular traffic increased 32% in the first half 2011. CMF provides four barges in this port, where there are wide anchorage areas, one of them with no port dues for bunkers-only operations. Since July 2011 CMF has increased its storage capacity in the port up to 310,000 cu m and increased to six the number of loading points for its seven barges in the Bay. Products supplied by CMF at this port comprise fuels of a variety of specifications (HSFO and LSFO from 380 to 30 cSt, MGO 0.10%, MDO, and most recently RMK 500). Gibraltar

As well as Algeciras, Gibraltar is situated at an extraordinary geostrategic position, at the crossroads of world trade. Gibraltar is a key service point for the global shipping industry, such as crew changes and supply of provisions, as well as being a well-known bunkering station. CMF supplies in Gibraltar offer the greatest flexibility to its customers, using a minimum of three barges in the port. In order to guarantee

World Bunkering Special Edition IBIA Annual Convention 2011

and LSFO from 380 to 30 cSt, MGO 0.10%, and operates a barge for bunkering operations. These notable developments established last year have brought significant success for CMF, enabling it to provide its customers with even greater flexibility, time savings and better service, and making of the Port of Huelva an efficient point of reference for bunkers.

safety operations and high quality products, they load directly from CEPSA shore tanks at Algeciras Port. Ceuta

Geographically located in the south part of the Strait of Gibraltar, Ceuta’s Port is a traditional supplier of marine fuels. This port, together with Algeciras and Gibraltar, forms an important logistics hub. The port is immersed in a great infrastructure expansion, comprising two main elements: a new logistic hub for vehicles, and new areas for provisioning facilities of 120,000 m2. This expansion means new developments in the near future and the growth of bunkering resources. Currently, CMF has storage capacity of 70, 000 cu m for all types of product (HSFO and LSFO from 380 to 30 cSt, and MGO 0.10%).

CMF in the Canary Islands

The strategic location of the Canary Islands, at a crossroads between Africa, Europe and the Americas, is a key factor in the role of the ports of Tenerife and Las Palmas as logistics centres for the three continents. Las Palmas

This port combines a significant container activity, a specialised station for international fishing fleets, a passenger stop for cruises and ferries, and a long tradition of competence in provisions, shiprepair and bunkering services. CMF has a considerable presence in the port, with two modern barges, trucks and pipe supplies. Additionally, CMF holds 150,000 cu m of storage for all types of grades: HSFO and LSFO from 380 to 30 cSt, MGO 0.10%, and MDO. Tenerife

This port offers a logistics platform that provides services to several industrial activities, one of which is CEPSA Refinery. With two barges and 150.000 cu m of storage for all range of bunker products, CMF has operated as bunker supplier since the refinery was built back in 1930, providing both Tenerife and Las Palmas with marine fuels of the highest quality.

New storage and jetty at the Port of Huelva

Huelva

CMF in Panama

The Port of Huelva is the first port situated at the entrance of the Mediterranean and is open to the Atlantic Ocean. Its particular geographical situation, only 80 miles from Gibraltar, and having been the home of metallurgic, mineral and petrochemical industries, has led to this port becoming a reference point for the bunkering market. The area is also experiencing a great industrial growth in the chemical, power and petrochemical sector, CEPSA being one of the main originators of this due to the recent upgrade of its refinery which has doubled its distillation capacity. As part of this important project, CMF reinforced its presence in the area, putting in place new resources and facilities. At the moment, CMF is the only marine fuels supplier established in this port; connected to the refinery it has 50,000 cu m of storage capacity for HSFO

CEPSA Marine Fuels is also present in Panama through CEPSA Panama since 1989. The country’s ideal location and infrastructures generate the transit of 14.000 vessels every year, which will be increased in the near future due to the Canal expansion. Balboa

At this port on the Pacific side of the Canal CEPSA has two double hull barges and boast storage at the Tabogilla Island, where it holds 55.000 mt of marine products. Cristobal

Located at the Atlantic, the company manages one double hull barge and storage of 24.000 mt.

Barge fleet *All barges are double-hulled. Ports

No. of barges

Capacity (Tonnes)

Algeciras

18,709

Gibaltar

16,037

Las Palmas

9,998

Tenerife

8,130

Barcelona

4,000

Huelva

3,200

Cristóbal

3,860

Balboa

7,080

The barges move about from one port to another; their number and exact location also depend on the fleet’s renovation

World Bunkering Special Edition IBIA Annual Convention 2011

34.71%, June 34.71%, July 37.78% and August 28.08%. Supplies are delivered both by pipe and barge. Five double hull barges currently operate at the port. Algeciras offers a package designed to attract bunker calls which comprises: an anchorage area where pilotage is not compulsory and where MARPOL services are free of charge, no light dues are charged from the fourth call on and no port taxes are levied for the first 72 hours of a stay. The current facilities in the Port of Algeciras Bay are operated by Repsol and Cepsa. The landmark Cepsa refinery has a total storage capacity of 2,100,000 cubic metres m3. Of this capacity 900,000 m3 are dedicated to crude oil storage, 220,000 m3 to marine products storage and the rest to other refined products. The refinery has a jetty with seven berth, four of them to load barges, and a single mooring buoy anchored in the bay. Ryttsa (Repsol IPF) and Cepsa Marine Fuel both take bunkers from the CLH Storage Terminal, which has a 202,453 m3 total nominal capacity. The terminal is directly connected by pipeline to the berth. Repsol has 112,453 m3 of storage capacity at the terminal and Cepsa 90,000 m3. Meanwhile the six-hectare Vopak Terminal Algeciras is currently under construction and expected to be operational by 2012. Once the terminal is finished, it will have a total storage capacity of 403,000 m3. The terminal will be directly connected by pipeline to a new jetty, which is also under construction.

Italian-based Decal delivers bunkers on a third party’s account in Barcelona and Huelva. Its communications director Cora Triboldi said: “The economic crisis is seriously hitting the bunker consumption worldwide. We have seen a very fast development when we started in Barcelona eight years ago, but there has been a relevant reduction after the crisis starting in 2008, leading to a present level of 70% of the maximum historic level.” Asked whether, as a terminal operator, the need to provide more grades - eg standard and low sulphur – represents a challenge Ms Triboldi said: “We are already delivering both high and low sulphur grades, without particular problems.” She observes: “The most active bunker port in Spain is Algeciras/Gibraltar, where a commercial battle is likely to happen in the future and could affect the consumptions in the port of Huelva.’ Recently Bominflot started supplying at Valencia using the 4,121 dwt double-hulled bunker tanker Besiktas Pera. An announcement said: “We can supply the fuel grade HS IFO 380 RMG 380 ISO 8217:2010 and gasoil DMA 0.1.” Bominflot said its barge will be loaded from new independent tank facilities inside the port of Valencia, for which Bominflot has signed a long term storage agreement with TEPSA. Bunkers will be delivered inside the port by barge. Bominflot is also able to supply ex pipeline to tankers operating at the TEPSA Terminal in Valencia.

Barcelona

Southern Europe’s “logistics gateway” sees volumes dip but looks to the future.

he Port of Barcelona is the main transport and services centre in Catalonia, one of the four ‘motor regions’ of Europe. Its area of influence stretches through the south and centre of Europe and North Africa. Last year the two suppliers active in the port, Repsol and Cepsa delivered a total of 765,229 tonnes of bunkers to 2,170 ships, down from 841,121 tonnes and 8,406 in 2009 when volumes were already down from a peak of 952,979 tonnes and 9,931 ships in 2007. Two barges barges work in the port, Flota Suardíaz’s Greenoil and Boluda Tankers’ Spabunker 41. Barcelona Port Authority and private operators have invested E11.8 millions in a new tanker berth, which was opened in August and enables the port to receive the largest tank vessels. Download rates of 3,200 cubic metres per hour are now possible, compared with less than half that previously. Other developments include a E50 million expansion of Meroi’s terminal, in a joint-venture with Russian oil major Lukoil, and another E59 million expansion at the Tradebe liquid bulk terminal. Meanwhile the Port of Barcelona is undertaking a number of studies into the possibility of supplying LNG as bunkers.

World Bunkering Special Edition IBIA Annual Convention 2011

SPAIN

Ceuta: growing in size

It may not handle the volumes of Gibraltar or Algeciras but the number of ships calling at Ceuta, and the amount of bunkers being taken, is continuing to rise.

he Spanish territory of Ceuta, on the African side of the Strait of Gibraltar, increased its volumes in 2010 by around 18% over 2009, the first full year that a bunker barge had been operating in the port’s anchorage since 2007. In 2010 there were 4,754 bunker ship calls, up from 4,324 in 2009 and 3,684 in 2008. The first half of this year’s figures suggest the upward trend in volumes will continue in 2011 at circa 14%, although the number of vessels was down somewhat, thus suggesting an increase in average size of vessels. Ceuta has generally supplied a large proportion of smaller vessels. The largest supplier is Cepsa but the increase in ship calls since 2008 (see table) is to a significant extent the result of the entry of Spanish-based oil trader Vilma Oil, and its move into the market as a physical supplier. Cepsa supplies from the Ducar II Terminal, connected to Poniente Wharf, while Vilma Oil operates from Ducar I Terminal, connected to Levante Wharf. The latter initially rented about half of the Ducar Terminal in 2006, mainly used as storage connected with trading activities. Since then it has expanded its operation and now runs the whole terminal. In 2007 Vilma Oil started supplying MGO from the terminal. In late 2008 and early 2009 it started phasing in sales of fuel. Supplying at first only high (IMO compliant) sulphur 380 cSt and 180 cSt bunkers, since the second half of 2009 the company has also sold 0.1% sulphur gas oil and from the beginning of last year it has supplied 1% 380 and 180 cSt. Since January 2010 Vilma has chartered a 3,684 cubic metre capacity bunker barge to provide a delivery service to client vessels in the anchorage area.

World Bunkering Special Edition IBIA Annual Convention 2011

Last year saw a marketing agreement between Vilma and OMTI. In a joint statement to World Bunkering the two companies said: “In order to enhance the skills and scope dedicated to the Ceuta anchorage supply service, Vilma Oil and OMTI (Europe) initiated a supply and marketing agreement in mid-2010 for barge deliveries. Utilising the combined trading and bunker marketing experience the service now attracts a broader customer base, which we expect to continue growing.” A Vilma Oil spokesperson said: “Regarding the first half of the year, one can say that the market continues to be competitive, though we are managing to attract more clients and advance the business. The weather was not as bad as in early 2010 and we only lost a few days in January due to maritime conditions.”

Bunker calls

Tonnes supplied

2008

3,684

480,000

2009

4,324

534,000

2010

4,754

628,000

1H11

2,217

360,000

Company News

Gibraltar: the Motorway Service Station of the seas It’s one of the most famous nautical names in the world but offers a surprising mix of services to shipoperators “In 2001,” says Captain Peter Hall, chief executive and Captain of the Gibraltar Port Authority, “the Port was delivering 2.9 million tonnes of fuel oil – a figure which had grown and been maintained to over 4.5 million tonnes in recent years. However, it is a figure that could exceed well over 6 million tonnes in a few years time.” With total port call numbers in 2010 reaching 11,134, and the 2011 figures continuing the upward trend, one can understand why Hall is planning to meet future growth. But as he explained, in order to build on the 258,148,181 gross tonnes handled by the Port in 2010, some key changes must take place: “At the moment, our ability to grow is finite because we have reached capacity with the anchorage slots we’ve got on the western side. We’re attracting 10% of the business that flows through the Strait of Gibraltar – there are approximately 110,000 ships which move through the Straits in the calendar year and we’re picking up around 11,000 of these ships, of which around 7,500 of them are taking bunkers while the others undertake crew changes, stores and spares. “Bunkering companies can supply all grades of marine fuel, from 30 cSt to 380 cSt. But we need to ensure that quality is maintained. We police these operations, conducting constant quality audits on each company to ensure that the service standards, as set out in the Bunkering Code of Practice, are met. The port has a very longstanding reputation for quality and that must be protected.”

But the Port continues to suffer from delays owing to the increasing demand. “We’ve been a victim of our own success,” Capt Hall said. “We’re a competitive port in terms of cost and as a consequence, can’t fulfil the customers’ expectations – they want to come here for cost effective, quality bunkers but we don’t have the space at the moment, which is frustrating for all. “My key focus, therefore, is to expand the footprint of the operation and overall, improve the whole situation for the customer who is only prepared to wait a few hours.” Capt Hall explained how plans to open the east side of Gibraltar for bunkering are gaining momentum: “It is essential for the wellbeing of the bunkering and Maritime industry that the government approve these plans.” Maritime stakeholders are excited by the plans, which could lead to the opening up of eight additional anchoring slots, representing a 50% opportunity to build on the port’s commercial activities. Enthusiasm for the port’s new Transas VTS is strong within all sectors of the industry, as improved efficiency and communications at the port will, no doubt, enhance business opportunities for all maritime stakeholders. Capt Hall explained how the recently installed VTS has ‘extended the window’ of vision for the port to 160-170 miles – an impressive feat considering how only a few years ago, there was a tower at the end of the quay “where the operation of the

Prince of Waves

World Bunkering Special Edition IBIA Annual Convention 2011

Regal gathering of ships

port was carried out with a pair of binoculars, a book and a pen”, and “you could probably see about two miles of what was happening”. A more accurate picture in terms of vessel arrivals will enable the port to accommodate more ships, while providing timely information to assist in promoting an efficient logistics chain. Capt Hall added: “If we are congested and see a vessel, we can advise them to slow down and thus the customer benefits because it reduces their costs – they don’t have to keep full speed going, they can slow down and the Master can plan a little better as well.”

Maha Gayatri and Evanthia

World Bunkering Special Edition IBIA Annual Convention 2011

Cruise operations

With plans to increase the size of berthing for cruise vessels, Gibraltar is improving its facilities and continues to welcome passenger vessels all year round, as the Rock’s Barbary Macaque monkeys, historical caves, and low-tax shopping centre provide a unique tourist experience. According to Captain Hall, the new airport terminal, expected to open this year, will pay dividends in building on this aspect of the maritime market, allowing Gibraltar to grow as a turnaround port for cruise vessels. He said: “Currently, a lot of cruises start and finish in the UK but if we can encourage part of that business to start and finish in Gibraltar, I think passengers will get a better experience; instead of the uncertainty of a day and a half of questionable weather going across the Bay of Biscay, they can fly into the sunshine and start their holiday immediately. “It also gives a benefit to the cruise operator in that they’re saving a day and a half or two days at sea, so there’s a fuel economy aspect too. In the winter months, you could start in Gibraltar and go further south along the African coast or to the Canaries or the Cape Verde islands. It just takes that window of operation and the uncertainty of the adverse weather of the Bay of Biscay, which could be a selling point for Gibraltar, along with the new airport and its ability to handle larger volumes of people. The synergy of the airport and the port fit together and there can’t be that many ports in the world where the airport is literally five minutes from the ship!”

Gibraltar

photo by Tony Davis

Tough decisions ahead

Gibraltar is the largest bunkering centre in the western Mediterranean and is operating close to full capacity. What options are there for future expansion?

fter increases in 2008 and 2009 the total volume of bunkers supplied in Gibraltar in 2010 dropped by 3.4% to 4,283,973 tonnes, although the number of vessels was almost the same, at 6,724 ship calls as compared to 6,708 in 2009. However, the local industry is confident that last year’s figures will prove to have been a blip as indications so far this year point to a significant increase. Outgoing Gibraltar Port authority chief executive officer, and Captain of the Port, Peter Hall told World Bunkering that the priority was “being able to expand volume”. That, however, will be difficult to achieve unless measures are taken soon to increase capacity at the territory’s anchorage. Based on current arrangements with all bunkering taking place in the Western Anchorage, Gibraltar is close to capacity and sometimes suffers from congestion, especially during bad weather. Capt Hall said: “At present we are servicing vessels with a minimal wait period but at times of adverse weather this situation does become protracted.” The congestion situation is not helped by the need for three storage tankers – referred to locally as ‘motherships’ – operated by Aegean, Bominflot and Vemaoil, which take

up a significant part of the anchorage. There are currently land-based storage tanks available for bunkering in Gibraltar; Cepsa/Peninsula takes its supplies from the nearby Cepsa refinery across the border. The biggest supplier in Gibraltar in 2010 was Vemaoil, a subsidiary of Greece-based Macoil, with about 31% of the market in 2010, just slightly ahead of Cepsa/Peninsula at 30%, while Aegean accounted photo by Tony Davis

Waiting times are minimal in good weather

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for some 23%, and Bunkers Gib/Bominflot 15%. The four suppliers between them operate a total of 22 barges. This year, however, the industry source compiling the figures has been unable to obtain comprehensive figures. In May this year there was fatal accident, the causes of which are still under investigation. An explosion blew the top off a sullage tank and two workers, believed to have been carrying out welding work at the time, were severely injured and one later died. The tank was close to the passenger ship berth and 12 passengers on the cruiseship Independence of the Seas suffered, mainly, minor injuries. The explosion caused a fire which later spread to an adjoining tank forcing landbased fire fighters to withdraw. The fire then had to be tackled from the sea, with the operation continuing for many hours. So has the accident had any effect on bunkering operations or any implications for the way bunkering will develop in the longer term? Capt Hall said: “No, the sullage operation at present provides a waste oil service from the arriving vessel ashore, where it is taken by road tanker for disposal.”

If volumes are to be increased much above current levels there are two obvious options that could be considered: replacing the current storage vessels with shore facilities, and allowing bunkering to take place on the territory’s Eastern Anchorage. The first option would be to bring the Kings Lines storage tanks, previously used for bunker operations, back into use. Capt Hall said that the government is “considering many alternatives” on the future of this facility. According to an industry source, however, there are various technical obstacles to returning the tanks to service quickly. The second option for increasing volumes is to allow bunkering on the east side of the Rock. Government plans to go ahead with bunkering are controversial for two reasons. One is that it stirs up the long-standing disagreement with Spain over the sovereignty of the waters around the territory. Secondly, environmental groups have opposed the move on the grounds that the risks of oil spills from bunker operations represent an unacceptable risk to the environment.

PORT OF

READY AND WAITING

www.gibraltarport.com Gibraltar Port Authority, North Mole, Gibraltar.

Tel: +350 20046254

Fax: +350 20051513

E-mail: gpaenquiries@portofgibraltar.gi

World Bunkering Special Edition 2011

photo by Tony Davis

Morning Sapphire

The issue has become intertwined with Gibraltar politics, with the opposition saying the east side should not be used. The issue has become a prominent one as the territory’s politicians prepare for parliamentary elections in November. Opponents of the plan talk about a continued lack of an EIA (Environmental Impact Assessment), as required under EU law. A government press release said that deputy chief minister, Joe Holliday, has already announced a full EIA. It added: “If any significant impacts on the SAC are identified then it will trigger the need to conduct a full Appropriate Assessment under the Nature Protection Act 1991, which transposes the (EU) Habitats Directive.” Mr Holliday said that “the government is conscious of the views expressed by the various consultees and the interest of the bunkering industry”. The opponents of the plan claimed in their submission: “Bunkering impacts on the natural environment in a number of ways. Chronic spills of fuel and chemicals are detrimental to marine life and vegetation. This has a knock-on effect on our local biodiversity.

The accidents off Gibraltar’s coastline over the years have starkly demonstrated the lingering impacts of oil pollution on the marine environment, which must be avoided at all costs. The severe impact from dragging anchors on the seabed and reefs are highly damaging and must be minimised, not increased. Any significant increase in shipping activity will also automatically increase the risk of a serious accident with the long-term consequences this would have on the natural environment.” Given the political nature of any decision to allow bunkering in Gibraltar’s Eastern Anchorage, it is unlikely to be taken quickly, whatever the outcome of the election. The government has also referred to the possibility of turning the Detached Mole into a bunker terminal. Few in the local bunker industry think this will happen in the near future, if at all, as it would represent a massive investment. Nevertheless, if Gibraltar is to continue to grow as a bunker centre, something needs to be done, and soon.

PORT OF

READY AND WAITING

www.gibraltarport.com Gibraltar Port Authority, North Mole, Gibraltar.

World Bunkering Special Edition 2011

Tel: +350 20046254

Fax: +350 20051513

E-mail: gpaenquiries@portofgibraltar.gi

CY CMY

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Italy

Looking for low sulphur

After a difficult year in 2009 Italy’s ports saw their volumes recover somewhat last year.

ajor Italian integrated energy company, Eni, reports that, in 2010, its marine fuel sales were 2.03 million tonnes of which 1.97 million tonnes were in Italy, up significantly from the 1.4 million tonnes it reported in 2010. Eni, through its subsidiary Agip, is active in 40 ports, of which 23 are in Italy. Genoa-based PL Pisano & Co puts overall bunker volume passing through Italian ports at about 3 million tonnes. Its chief executive officer, Pietro Luigi Pisano says the main problem in Italy is the availability and production of fuel oil low sulphur 1%. However he notes that, as elsewhere, Italian suppliers have had their margins squeezes due to price volatility. Regarding his own company Mr Pisano explains that it was founded by his father, Vittorio Pisano, in 1957 as the exclusive bunker broker and agents for Agip, as well as being agents in Genoa and the surrounding province. Pietro took over the bunker business in 1971 and moved from being an exclusive Agip broker to running an international operation. In 1976 he founded Pisano Trading Oil to expand the range of business activities, including the sale of lubricants. Mr Pisano says: “The international business has achieved great success and expanded considerably. Our position as bunker specialist has been appreciated by various owners and suppliers. I consider keeping the same team for many years to be a great achievement. This has enabled the companies to build up a reputation for honest trading, stability and long established business links with suppliers and customers alike.” In 2003 Vittorio Pisano, Pietro Luigi’s son, joined the family business after obtaining his degree in Maritime Economics and Transportation at the University of Genoa.

World Bunkering Special Edition IBIA Annual Convention 2011

This year there has been another development. From 1 October the activities of PL Pisano and Pisano Trading Oil have been incorporated into a new company, Pisano Bunker. Mr Pisano says that the intention is to give the business a modern stamp, a stronger financial position and easier communications with the market. Meanwhile, early this year Alpha Trading announced it was becoming a physical supplier in Italy’s third largest bunker port, Augusta in Sicily, using a local barge operator to undertake all deliveries. Italian-based Alpha Trading said it would be supplying 380 cSt fuel oil and MGO. The company’s website says sold some 2.1 million tonnes of bunkers in 2009. Also expanding is Lukoil-Bunker Italy, the Italian subsidiary of Lukoil, the major Russian energy company. Lukoil has a 49% stake in Sicilian refinery ISAB which produces fuel with less than 2.5% sulphur content. It has launched a bunkering operation in the Atlantic. The company says it will supply fishing vessels as well as ships transiting waters off Mauritania and Senegal. It says it is deploying the 12,000 dwt bunker barge Vasi to supply all grades of high-sulphur fuel (from IFO30 to IFO380) and MGO. The Vasi is equipped with a blending system. Last year Lukoil announced that it was starting bunkering operations at Augusta. Low sulphur supplies have become an issue in Italy although, unlike northern Europe, the Mediterranean is not an IMO Emissions Control Area (ECA). Its ports are, however, subject to the European Union’s strict regulations on the sulphur content of fuel used while alongside the berth. In August, Disney Cruise Line ran foul of the requirement to use fuel with a sulphur content of no more than 0.10%, unless scheduled to be in port for less than two hours. According to local reports the 88,000 gt Disney Magic was fined E30,000 for using non-compliant fuel in Naples.

half page.ai

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11:46:10 AM

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JB Sorotto.ai

01/06/2011

17:12

MALTA

Long term optimism

Malta’s bunker suppliers are finding life tough at present but there is confidence that the small Mediterranean island state will be able to compete strongly in the future.

ituated on the main shipping lanes though the Mediterranean, Malta is the obvious place to take bunkers. Last year Malta’s bunker industry delivered about 1.2 million tonnes of residual fuel oil and just over 0.25 million tonnes of MGO. There are four companies offering residual fuel and several others just selling MGO. Shell International built a storage facility at Marsa in 1960 and ran it until 1975 when it was taken over by the Maltese government and passed on to Sea Malta Company in September 1982 when Mediterranean Offshore Bunkering Company (MOBC) was established. MOBC operated as a physical supplier for 20 years and ran a fleet of bunker barges, until again taken over by the government in 2002. In 2004 MOBC became solely a storage facility operator. In April the Malta Environment and Planning Authority (MEPA) took action over complaints of air pollution resulting from MOBC’s facility. Loading and discharging fuel was stopped temporarily and the government announced a new system of environmental certification. Malta’s environment parliamentary secretary Mario de Marco was reported as saying that studies had pointed to fuel storage and bunkering activities taking place around the Marsa harbour being the main source of the fumes. Not all shore-based tanks had vapour recovery systems in their ventilation tanks, it had emerged. During the 1990s another oil terminal was opened at Marsaxlokk, operated by Oiltanking. It has four berths, the largest able to take ships of up 120,000 dwt. Falzon Group’s subsidiary San Lucian Oil Company is one of the main suppliers and can deliver both high and low-sulphur fuel oil up to 380 cSt by barge. The company also operates the country’s only waste oil recycling facility. Carmelo Caruana has been offering ship to ship transfer services off Malta since the 1980s. Meanwhile US-based independent marine fuel supplier Bunker Supplies Malta Ltd has been running a joint venture with US-based Bunkers International to supply MGO in Valletta, Marsaxlokk, and offshore Malta for just over a year.

World Bunkering Special Edition IBIA Annual Convention 2011

Physical supplier Island Bunker Oils was set up in 2002 and operates three bunker barges. Island leases facilities at the Mediterranean Offshore Bunkering company in Marsa as required and also leases storage at Oiltanking in Marsaxlokk. Ship’s agent Sullivan Shipping’s chief operating officer John Sullivan told World Bunkering: “Tough competition from other large players in the Mediterranean region as well as the continuous pressure from ship-owners to cut costs is driving down the profit margins of the bunker suppliers. This is having a ripple effect on all service organisations related to the industry, which in turn are having to cut their own margins. This will in turn, perhaps in the longer run, affect companies’ investment plans.” He added that Malta is, like other bunkering centres, also experiencing pressure on margins due to the increase in oil prices worldwide in the aftermath of the African uprisings and the overall global economic crisis. Outlining his company’s activities Mr Sullivan said: “Within our company we have two main divisions: Port Agency and Ship Husbandry and Logistics and Freight Forwarding. We also have a subsidiary that specialises in ship registration and related services. Today our group has grown to a size where we can boost expertise and experience in a number of areas of the markets in which we operate. Our network of partners and principals includes a number of global players within the maritime industry and we have embedded their standards of quality within our organisation’s culture. We thrive to create business solutions that can assist our principals in today’s difficult business environment and have thus developed a service oriented approach were we objectively seek to add value. Our plans are to continue to add pillars of expertise within our portfolio of services and develop innovative solutions.” Mr Sullivan noted that there were several investments in the pipeline. Among them was Horizon Terminals Limited (HTL), a wholly owned subsidiary of Emirates National Oil Company (ENOC), which has identified Malta as the location for its next new terminal.

It will have a capacity of 600,000 cubic metres for black and clean products, with one jetty for very large crude carriers and two for vessels up to 120,000 dwt. He comments: “This shows confidence in Malta as a strong business model and as a gateway to the European market.” Eddie Zammit, Salvu Zammit & Sons’ general manager said one of the main challenges facing the country’s bunker suppliers is the issue of bad weather curtailing operations. He said that the problem could be solved easily “if the Transport Ministry opens up new bunkering anchorages”. He agreed that there were “huge pressures” on margins, but worse was the problem of delayed payments and the higher risks of bad debts in the current economic situation. He said his company supplied around 25,000 tonnes (IFO and MGO combined) and has plans to expand but he added: “There is no space for more suppliers in the current economic climate, that is to say for the next two to three years.” In the longer term, however he was more optimistic, saying: “Ship to ship activity outside territorial waters will add to the growth in the bunker sector. All such investments and initiatives will help strengthen the whole local maritime industry as they will affect other segments of the industry. Even though the bunker operations in Malta are on the rise, tough competition from other stronger players in the Mediterranean region will continue to be a driving factor. “I do believe that with better infrastructure, economic conditions and general improvement in the Malta market, Malta can take more bunker volume from its regional competitors.”

World Bunkering Special Edition IBIA Annual Convention 2011

Greece

Hard times

While the Greek debt crisis continues to send shock waves throughout the global economy, the country’s bunker suppliers are staying calm and carrying on.

otal volumes in 2010 were 11% down on the 3.5 million tonnes supplied in 2009, which represented a 12% drop on 2008 figures. But the first half figures for 2011 show a 2% increase on the same period last year and industry sources say July and August figures were considerably better. JetOil’s general manager, Alexander Prokopakis, is cautiously optimistic about prospects for the Greek bunker industry. He told World Bunkering that a 23% increase in cruise ship arrivals has given the bunker market a boost this year, as has the 20% increase in car carrier arrivals at Piraeus. On the other hand, the coastal ferry operators are having a very hard time, with losses reported by all the companies and consolidation services taking place. All commercial activity in Greece over the past year has been overshadowed by the country’s severe financial crisis but Mr Prokopakis said it had not had a direct effect on the bunker industry, and that the strike at state-owned refiner Hellenic Petroleum (HP) had a limited impact. Also it had become more difficult and expensive, but not impossible, to get access to capital – something made necessary by the increasing bunker price. As from the beginning of this year the Greek government no longer publishes a breakdown of bunker volumes by supplier, but Mr Prokopakis believes JetOil has held its market share, which was about 18% in 2009. The company has taken measures to cut its costs, including reducing its bunker tanker fleet from four to three, and improving the utilisation of the remaining vessels. Mr Prokopakis was upbeat about the future in the Greek bunker market and said that because of the Greek economic crisis it was now important for everybody to concentrate on continuing to work hard. He thought it could be possible to get back to 2008 volumes by 2013. Piraeus accounts for about 90% of total Greek bunker sales; 90% of that is 380 cSt fuel with 180 cSt and MGO representing 7% and 3% respectively. Product for the Piraeus market comes from three refineries, two owned by HP and accounting for about 60% of the market, with the third being the private sector Motor Oil Refinery. Based on 2009 figures, EKO and Aegean Marine Petroleum

World Bunkering Special Edition IBIA Annual Convention 2011

Network Inc (AMPNI) were the two largest suppliers, each with about a quarter of the market. The next largest supplier last year was JetOil with about 18%. Other players include SEKAvin, SEKA and ETEKA with 10.1%, 8.9% and 6.1%, while there are about two dozen other active suppliers in the Greek market. Isidora Vassiliou of Mediterranean Bunker Services told World Bunkering that the country’s debt crisis and recession, coupled with the fact that Greece is losing out to other bunkering centres on price, means great pressure is placed on the margins. She added that obtaining credit has also become a big issue. There has been an “enormous decrease” in credit facilities. Many suppliers are taking a very hard position on credit lines, lowering or even withdrawing them completely. Shipowners were already being squeezed by low freights and increased running costs due to high bunker prices, causing big cash flow problems. Now, not being able to obtain credit is making it even more difficult for them to pay. Even large shipping companies and trading houses are experiencing the same difficulties. Ms Vassiliou said: “Fear of reliving the market conditions experienced during 1977 and 1987 when freights improved but bunker availability was poor and caused problems in vessel performances is something that will haunt the current situation.” She also agreed with a recent comment made by the head of shipping at German bank DVB, Dagfinn Lunde, who said: “The shipping industry is facing a long-term disruption and not just a temporary sluggishness.” However, on a more upbeat note, Ms Vassiliou noted that Piraeus port is moving ahead with plans to increase container handling capacity by 30% to 500,000 TEU a year. The government has said its ultimate aim is for Piraeus to have the capacity to handle 1 million TEU. She added: “We believe that the Greek ports will provide a catalyst for growth for companies when the Greek economy emerges from its current quagmire and we remain confident that there is an opportunity for the whole economy to recover. Tourism along with the cruising market are strong elements of our economy.” Mediterranean Bunker Services has taken delivery of its first 2,000 dwt tanker, Princess I, as part of an overall expansion strategy, which will be announced later this year.

Russian update

A round-up of the Russian bunker scene as reported by Port News. St Petersburg back to pre-crisis volumes

Lukoil-Bunker’s Murmansk branch supplies Prirazlomnaya

Players in the greater St Petersburg bunker market have told Port News that volumes have matched the pre-crisis level of 200,000 tonnes a month. There are a total of 22 bunker companies currently operating within the greater St Petersburg port area, which comprises the Neva River delta, Neva Bay and Kronstadt. The rise mirrors an increase in freight moving through the port. The Association of Sea Commercial Ports (ASOP) says that freight passing through the greater St Petersburg port area in JanuarySeptember 2011 rose 5.4% on a year-on-year basis to 44.9 million tonnes. The port handled 9,227 vessels and 58.5 million tonnes of cargo, a 15.2% increase on 2009.

Lukoil-Bunker’s Murmansk branch has supplied diesel to the massive Prirazlomnaya platform while it was at Murmansk’s 35th Shipyard. This bunkering operation was difficult and unique as the fuel had to be lifted 50 metres. As well as successfully fuelling the platform, the company supplied bunkers to the tugs that will move the ice-resistant fixed platform to the oilfield. The Murmansk branch also supplies bunkers to vessels sailing through the Northern Sea Route. Recently it supplied 1,400 tonnes of fuel oil to the Sanko Odyssey. The bulk carrier was carrying 70,000 tonnes of iron ore and was the largest dry cargo vessel to sail through the Route.

AMKOIL LTD P a r t o f A M K G r o u p o f C o mp a n i e s

Your bunker supplier in the port of Murmansk and other ports of Murmansk region. We supply: »» bunker fuel »» all types of petrol »» fuel oil M-100 »» fuel IFO-380, IFO-180, IFO-30 Amkoil Ltd 86 Podgornaya Street, Office 413, Murmansk, Russia 183038 E-mail: amkoil@mail.ru

Tel/Fax: 007 (8152) 287828 Tel/Fax: 007 (8152) 287337 Tel/Fax: 007 (8152) 286028

World Bunkering Special Edition IBIA Annual Convention 2011

Baltic Fuel Co set for a RUB3 billion expansion

Baltic Fuel Company (BFC) is planning a RUB3 billion (US$95 million) expansion with the focus on developing its transport assets. This will involve the expansion and upgrade of its fleet of ships and trucks carrying oil products to and from the company’s facilities at St Petersburg, as well as its separate towage division. BFC will also be investing in environmental services, specifically shore-based treatment facilities at the ports of the Gulf of Finland, as well as expansion of the company’s presence in Russia. BFC’s general director Stanislav Korneev said: “Creation of modern port facilities is a core component of the development potential of the company in the field of services. Building a multipurpose terminal in the port of St Petersburg to aid the development of all of the company’s business segments will be a priority of the Group. As the company enters the market of container traffic and optimises and expands its environmental services, it needs to establish efficient port infrastructure applying cutting-edge technological solutions. Another major objective is to reduce the fleet’s average age.” In the next five years, BFC plans to diversify its business and strengthen existing activities. The company’s expansion into inland oil products shipping will involve the company operations in the Volga and Don basin, according to Mr Korneev. The company’s strategy includes an action plan to gain market share in the Black, Azov and Caspian Sea markets. Baltic Shipyard launches Project 2734 lead ship for BFC

The Baltic Shipyard is building a series of four oil barges for Baltic Fuel Company Group (BFC), which is set to increase its fleet to 40 vessels. The launching and naming ceremony of the Taisiya, the lead vessel of Project 2734, a series of four non-self propelling tankers, took place in late September. The newbuilds’ contract was signed in November 2010 between the shipbuilding firm and BFC. The Group’s RUB400 million (US$13 million) investment is partly financed by the St Petersburg Bank. The Project 2734 vessels were designed by the Marine Engineering Bureau. The barges will be transporting petroleum products with a flash point of 60ºC and above, including those requiring heating. They will be able to operate in inland waterways and sea areas where there is broken ice no thicker than 20cm.

World Bunkering Special Edition IBIA Annual Convention 2011

The 108-metre long, 7,000 dwt double-hull barges have 12 cargo tanks with a total volume of about 6,000 cubic metres. The barges can be pushed or towed and are being built to Russian River Register class. Another three vessels of the series will be launched by the end of this year. The company says the project was developed to satisfy customers’ requirements using the latest technology and internationally approved standards of shipbuilding. Gazpromneft Marine Bunker expands

Gazpromneft Marine Bunker has undertaken its first supply at Sakhalin, at the anchorage off the port of Korsakov. The seismic survey vessel Pacific Explorer took on 595 tonnes of marine low-viscosity fuel. The vessel is supporting the construction of offshore pipelines near the Kirinskoye gas condensate deposit. The survey vessel will be operating there until 30 November, so Gazpromneft plans to continue bunkering in the area. It has operated in the Far East since 2008 and has about a 10% share of the regional market, operating at Kozmino, Nakhodka, Posiet, Sakhalin, Slavyanka, Vladivostok, Vostochny and Zarubino. Meanwhile the company has acquired a 2004-built, 3,000 dwt tanker for operation at Black Sea ports. It arrived at St Petersburg in October and was expected to enter service at Novorossiysk in November. A Gazpromneft Marine Bunker’s subsidiary Gazpromneft Shipping undertakes technical maintenance of the tanker. The company says the purchase of a barge was the next step according to its medium-term investment programme for 2011. Currently Gazpromneft Shipping operates seven bunkering vessels: Gazpromneft East, Gazpromneft West, Gazpromneft Nord, Gazpromneft Zuid, Aral, Crystal, Gazpromneft Zuid-West, which deliver bunkers at Kaliningrad, Murmansk, Novorossiysk and St Petersburg. To enhance its competitive advantage and increase its owned fleet, Gazpromneft Marine Bunker plans to buy one more bunker tanker by the end of this year.

For more from Port News visit: www.portnews.ru

INLAND WATERWAYS

An ethical approach on the Volga

Vladimir Nikiforov

In the first of an occasional series on bunkering inland waterways Vladimir Nikiforov, general director of Nizhegorod-Bunker, a leading Russian regional supplier, speaks to World Bunkering about the peculiarities of operating in the region and the prospects for this year.

n April, Nizhegorod-Bunker started its so-called ‘small’, or early season, operations by supplying one of the local ships, the Altay. At the start of the season the company had ample orders from other companies working on the Volga River and peak season prospects looked promising. Mr Nikiforov says: “I can say with all certainty that our company entered the navigation fully equipped and prepared. Last winter we fulfilled all planned maintenance and repair works, and purchased all necessary equipment, including several sets of GLONASS satellite navigation systems for our tankers. “Navigation systems like this help our ships operate safely and allow and introduce further innovative upgrades. Our fleet consists of eight bunker tankers with a total capacity of more than 7,000 tonnes. “As well as striving to improve technical performance the company has worked hard on the financial side of its activity. This resulted in choosing the right bank to work with, UralSib, and eventually concluding some favourable credit agreements.”

“On the Nizhegorod bunkering market during the 2010 navigation season our company was responsible for some 70% of services; in the North West area (the River Sheksna and Cherepovets town, some 40%. In my opinion all the shipping companies working in the region of the Upper and Middle Volga and the North West wanted Nizhegorod-Bunker as a partner. “We have kept all our clients from 2010 and gained new ones as well. That is because last autumn we stayed in the market longer than the other bunker suppliers and kept providing services until the river froze over. We have already concluded 110 contracts with shipowners for this year’s navigation season. So, as you can see, we have the foundation to maintain the dynamic growth of our business. “But what really makes Nizhegord-Bunker stand out is its own fleet, capable of delivering bunkers to different locations as required by the shipowner.”

So there are good reasons for optimism?

“The main problem is with the developing bunker fuel price situation in the market. Problem number two is the lack of adequate and tolerant administrative regulations towards dynamic companies within the medium segment of the market. It is obvious that the bureaucracy that prevents companies from working at full strength and building a smoothly operating market should be eliminated. We are aware of the problems that we encountered during last year’s navigation and we know how to deal with them this year. The company will have as successful a navigation this year as it had in 2010. This will be a result of the professionalism of our staff and a determination to work to ethical business standards.”

“Most certainly! The 2010 navigation was quite successful for our company. We achieved good volume sales and financial stability, allowing us to gain a considerable share of the market and proved that Nizhegorod-Bunker is a significant force in the Nizhegorod region. “The fact that volumes of bunkering increased by 150% last year shows that, well into the second decade of our activity on the market, we are an effective developing company striving for success.” How do you see the role of Nizhegorod-Bunker among the other players of the regional market?

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Are there any issues affecting your company’s activity during this navigation?

BFC opens Russia’s inland waterways to foreign partners

altic Fuel Company (BFC) is going to become a reliable partner for its foreign colleagues for trade on Russian rivers, as the Russian government pushes for the opening up of the country’s inland waterways to foreign-flagged cargo ships. Russia has a unique system of navigable rivers and canals, which provides huge opportunities for transit cargoes as well as for exports/imports flows through its inland waterways. However, the transit potential is still poorly implemented compared to EU countries. To take full advantage of the country’s inland waterways logistics opportunities, the Russian government approved a bunch of measures last year to provide access for foreign flagged vessels to navigate on the inland waterways. The package plan, intended for 2011-2015, consists of three tasks: measures to prepare legal regulations, development of the inland waterways infrastructure and measures to improve the management of inland waterways. At the moment, according to the Russian Code of Inland Waterway Transport (CIWT), any foreign vessels have to obtain a special permission from the Russian government to transit inland waterways.

It is assumed that cargo vessels flying foreign flags would be allowed to enter the inland waterways under bilateral agreements between the governments of the Russian Federation and the State flag. First of all Russia sees no obstacles for signing the bilateral agreements with her neighbours, such as Kazakhstan, Ukraine and Azerbaijan. Such agreements will provide wide opportunities for navigation of foreign vessels on Russian rivers. This will also require the availability of reliable Russian partners. Baltic Fuel Company (BFC), which has experience in inland shipping, is ready to act as a partner for foreign players in the market and to consider establishing joint venture with partners from the countries that will have inter-governmental agreements. Some experts say Russia’s inland waterways could be attractive largely for shipments as for general cargoes as for oil products. Currently, BFC has been actively developing the delivery of oil products on the rivers. The company has implemented a shipbuilding program to create the first series of four oil products tankers with a total capacity of more than 20,000 tons, which will commence shipping on Russian rivers in the navigation of 2012. These vessels

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fully comply with all international environmental standards and safety requirements, and have passed the ship-vetting inspection required by oil companies, such as BP and Shell. The first serial oil tanker, Taisiya, was launched at Baltic Shipyard (St Petersburg, Russia) on 27 September 2011. The tanker’s features include a reinforced hull with double bottom and double sides in the area of 12 cargo tanks, with a total volume of about 6,000 cubic metres. One of the advantages of the inland transportation of oil products is the possibility of relatively small shipments at a much lower cost. In comparison with railroad transportation the cost of inland transportation could be up to 35-50% lower depending on the direction. Currently, BFC is considering two route options: a short distance on the route Rybinsk/Yaroslavl-St Petersburg and a long one – Samara/Perm-St Petersburg. Upon completion of the Inland Waterways Shipping program and commissioning of the ten newbuilds tankers, BFC plans to carry from 600,000 and 950,000 tons of cargo a year. The company said it would be willing to implement the shipments both in the interests of Western oil traders and in partnership with them. It is also likely that inland waterways will prove profitable for shipments of export fertilizer and import general cargoes. BFC hopes that the arrival of foreign partners on the Russian inland waterways will enhance the quality of this segment of the market and bring river traffic to a new level. As the Russian government’s plans would at best be realised by 2020, it would be wise for leading Western companies to start cooperating now with the major Russian companies that are actively investing in their own fleets and can act as reliable partners. This will expand the inland waterways business and make it profitable for everyone.

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Technical

Sooty threat to ice cap

Tiny particles of black carbon may be taking centre stage as the latest villain in global warming, but research suggests that it could be inexpensive and easy to irradicate.

hile carbon dioxide is currently Public Enemy No 1, eliminating black carbon emissions could soon be the next big challenge for the global shipping industry Soot particles in the atmosphere are now emerging as the second most important, but previously overlooked, factor in global warming, according to Stanford University research scientist Mark Jacobson. He told an American Chemical Society (ACS) meeting that reducing soot, or more specifically black carbon, emissions from diesel engines and other sources could slow down the melting of sea ice in the Arctic faster and more economically than any other quick fix. Speaking at the 242nd National Meeting & Exposition of the American Chemical Society (ACS), Dr Jacobson cited concerns that continued melting of sea ice above the Arctic Circle will be a tipping point for the earth’s climate, a point of no return. That is because the ice, which reflects sunlight and heat back into space, would give way to darker water that absorbs heat and exacerbates warming. And, he noted, there is no known way to make the sea refreeze in the short term. While there has been concern at the effects of soot on global temperatures for some time, and particularly with respect to its impact on Arctic ice melt, there has been a view in shipping industry circles that the science remains uncertain. Nevertheless, the issue has started to be discussed at IMO. Speaking at the International Chamber of Shipping’s International Shipping Conference, the body’s director, regulatory affairs, told delegates that so far there was very little data on the subject. He said the first job of the IMO working group was to define ‘black carbon’ before it could move on to how to control it. Dr Jacobson said, however, that he had calculated that controlling soot could reduce warming above parts of the Arctic Circle by almost three degrees Fahrenheit within 15 years. That would virtually erase the warming that has occurred in the Arctic during the last 100 years. “No other measure could have such an immediate effect,” said Dr Jacobson. “Soot emissions are second only to carbon dioxide

(CO²) in promoting global warming, but its effects have been underestimated in previous climate models. Consequently, soot’s effect on climate change has not been adequately addressed in national and international global warming legislation. Soot emissions account for about 17% of global warming, more than greenhouse gases such as methane. Soot’s contribution, however, could be reduced by 90% in 5-10 years with aggressive national and international policies.” Soot consists of black carbon particles, nearly invisible on an individual basis, released in smoke from combustion of fossil fuels and biofuels. Major sources include exhaust from diesel cars, buses, trucks, ships, aircraft, agricultural machines, construction equipment and the wood/animal dung fires that hundreds of millions of people in developing countries use for cooking and heating. Black carbon particles become suspended in the atmosphere and absorb sunlight. The particles then radiate that heat back into the air around it. Black carbon can also absorb light reflected from the earth’s surface, which helps make it such a potent warming agent. According to Dr Jacobson, the good news is that decreasing soot could have a rapid effect. Unlike carbon dioxide, which remains in the atmosphere for years, soot disappears within a few weeks, so that there is no long-term reservoir with a continuing warming effect. And the technology for controlling black carbon, unlike that for controlling CO², is already available at relatively modest cost. Diesel particulate filters, for instance, can remove soot from car and truck exhaust. Governments and other agencies are also trying to introduce lowsoot cooking stoves in developing countries. “Converting gasoline and diesel-burning cars and trucks to electric or hydrogen vehicles, along with reducing emissions from diesel generators could have an immediate effect on warming,” said Dr Jacobson. Although Dr Jacobson did not particularly single out the shipping industry, Exhaust Gas Cleaning Systems Association chairman, Don Gregory, also speaking at the ICS conference, said he believed that within a decade all ships, even those burning distillate fuel, would need a funnel emissions treatment system to remove black carbon and particulate material.

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Company News

Rosneft Marine: Upgrading its supply chain to ensure the highest quality fuel

osneft Marine UK, the international marine fuel trading business of Russia’s national oil and gas company Rosneft, is well positioned to meet the changing demands for marine fuel products as the global shipping industry moves towards tighter regulations to protect the environment. The company understands the importance of ensuring the reliable availability of premium quality low-sulphur fuel oil. It is able to control all stages of the supply chain, from the refinery to the barge, ensuring that it is always in control of the quality of the fuel it delivers to customers. This allows Rosneft Marine to deliver only premium quality 1.00% low-sulphur fuel oil that exceeds all international standards, including MARPOL. As demand for low-sulphur fuel increases, the quality being supplied in many ports around the world has been called into question. To comply with sulphur limits and meet demand, some fuel suppliers have resorted to blending high sulphur fuel oil with questionable stock, leading to disputes and costly problems with ships engines. One of the main priorities for Rosneft Marine is to ensure that its customers consistently receive the best quality fuel available. By implementing international standards across its integrated supply chain, Rosneft is able to readily supply clean fuel to its customers – and demonstrate an in-depth understanding of the realities of a changing global fuel supply marketplace.

Rosneft Marine and RN-Bunker, another subsidiary of Rosneft which manages its domestic bunkering in Russia, recently jointly launched their first bunker delivery tanker to service the Black Sea Port of Tuapse in Russia. The RN Taurus, a 3,569 dwt bunker tanker is specially designed to prevent oil spills. The Russian-flagged tanker is part of Rosneft’s strategy to develop modern, environmentally friendly bunker tankers for use in Russian ports while replacing ageing bunker tankers from the Soviet era. Andrei Tuchnin, Director of RN-Bunker, said: “Rosneft is committed to improving service to our customers by continuing to introduce modern and up-to-date vessels and technologies. Our new tankers will ensure that our customers receive reliable and efficient delivery

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while we play our part in helping protect the environment that we operate within.” A second bunker tanker, the RN Magelan, has been delivered to the Port of Murmansk, with more new vessels expected in the ports of St Petersburg and Arkhangelsk in the next few months. The company is also looking to introduce a 6,000 dwt tanker to meet the growing demand for bunkers in ports in the Russian Far East. Vladimir Brezhnev, Director of Rosneft Marine UK, said: “The introduction of our own bunker tankers will help us better control the quality of fuel we deliver to our customers through our integrated supply chain. We are continuing to develop our physical assets to meet growing customer demand in ports like Tuapse, which is Russia’s second largest Black Sea port.” Rosneft Marine is also focused on the development of its other physical assets such as its refineries and storage terminals, which will enable it to increase its volumes to meet the growing demand for low-sulphur fuel. Rosneft Marine currently has a presence as a physical bunker supplier in the Baltic, Black Sea, Russian Far North and Russian Far East; and it supplies 1.00% low-sulphur fuel in Russian ports. Rosneft Marine continues to plays its part in ensuring sustainable supply of high quality low-sulphur fuel for shipowners and operators while preparing for the challenges ahead as new marine fuel regulations are introduced.

Company News

AMKOil Ltd

Portugal fuel stop

ounded on 25 May 2004, the AMK Group of Companies is one of the biggest on Kolskiy Peninsula. The main activity of the AMK Group is the trade and transportation of the following oil products: • bunker fuel • all types of petrol • fuel oil M-100 • IFO-380, IFO-180, IFO-30 The AMK Group consists of several companies involved in different types of activities, such as bunkering, road transportation of oil products, utilisation of mixed oil waste and bilge water, and the use of a shipping and receiving platform. All companies within the group are licensed to conduct the above mentioned activities. One of the company’s main activities is the bunkering of foreign and Russian vessels in the port of Murmansk and other ports within the Murmansk region, as well as neighbouring shipping areas. The fleet of the group of companies consists of 9 tankers: Shalim, Olkhovets, Dnepr, Don, Salnyi, Krakovets, Sosnovets, Sever and Lakhta allowing the transportation of all types of oil products and bilge water up to 300 tonnes, as well as up 3,300 tonnes of heavy oil products and bunker fuel. The tankers are capable of bunkering 20 miles offshore as well as travelling to foreign ports to provide their services. All the ships are staffed with experienced personnel who have at least five years’ experience of working on these classes of vessel. The AMK Group of Companies’ transport hub consists of eight units of equipment, namely four petrol tank trucks with capacity ranging from eight to 23 cu m, and four fuel oil trucks with capacity ranging from 15 to 23 cu m. The trucks are used for the transportation of bunker fuel, and all types of petrol and fuel oil in Murmansk, the Murmansk region and the Republic of Karelia. The company has its own overhaul and maintenance facility based within the Murmansk Sea Fish Port, which it uses for servicing its own machinery, as well as providing maintenance services for other companies. All the drivers are licensed to drive dangerous cargo vehicles and the depot mechanics are all highly qualified in their specialist areas. The various operations of the AMK Group of Companies are supported by a highly professional team of lawyers. The company is open for cooperation in the transportation and trade of oil products, and welcomes mutually beneficial partnerships.

ased at Lisbon, Galp Energia Group, is able to offer fuel supply services to all ships visiting this warm and pleasant country. Galp Energia has professional bunkers team provide its customers with high-quality fuels and services, and the highest safety standards in all its bunker activity and the company’s bunkering products fulfil the ISO 8217: 2010 specification in all grades. To help achieve customers’ targets on the environment, the company can supply low-sulphur fuels at several ports, with the port of Lisbon being the main port for low-sulphur fuel. Optimising its logistics resources and storage capabilities Galp Energia is able to provide high-quality services and products, including a wide variety of marine distillates. Galp Energia is the main bunker supplier in Portugal, and provides bunker services using its two barges with capacities of 5,800 tonnes and 3,000 tonnes each. A 5,800 dwt double-hull barge, Bahia Tres, began operations in 2010 to support the company’s business in the ports of Sines and Setúbal, meeting all the important aspects for safety and protecting the environment. It is equipped with anti-pollution measurers and is covered by European Maritime Safety Agency regulations in the Atlantic Ocean and Mediterranean Sea. Always aware that its customers’ main concern is product cost, the company offers competitive prices without compromising product or service quality. Visiting Portugal and being supplied by Galp Energia will always be a good decision for regular customers, used to working with a professional team. We are the only refinery in Portugal and operate refineries at Sines and Matosinhos. We have an extensive product range that includes gasoline, diesel fuel, jet fuel, fuel oil, LPG, bitumen and several aromatic products. Our refining business is responsible for the supply of oil products to our retail, wholesale and LPG marketing divisions, competitors and foreign customers, as well as for the operation of our refining and logistics assets. We hold a significant position in the Portuguese crude oil products storage market. Our two refineries in Portugal together represent 20% of the Iberian refining capacity, and collectively account for the majority of Portugal’s annual domestic petroleum product requirements. We are investing approximately €1.4 billion to upgrade and improve the efficiency of our refineries, representing €1 billion for Sines and €0.4 billion for Matosinhos. .

Alexander Koltunov, Director Roman Moliboga, Commercial Director Maksim Vorobyov, Technical Director Anton Smolin, Head of Bunkering Mob: 007 9113090999 86 Podgornaya Street, Office 413 Murmansk, Russia 183038 Tel/Fax: 007 (8152) 287828 Tel/Fax: 007 (8152) 287337 Tel/Fax: 007 (8152) 286028 E-mail: amkoil@mail.ru

For further information contact: Galp Energia SA Tel: +3512 1724 0637/654 Fax: +3512 1724 2957 E-mail: bunkers@galpenergia.com www.galpenergia.com

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Company News

Gazpromneft Marine Bunker: market leadership is our goal

azpromneft Marine Bunker, a subsidiary of JSC Gazprom Neft, was found in October 2007 for the year-round supply of petroleum products – fuel oil, marine fuel and lubricants – for sea and river transport. The company has five offices and two subsidiary companies; Gazpromneft shipping manages a fleet 6 bunkering vessels Gazpromneft East, Gazpromneft West, Gazpromneft Nord, Gazpromneft Zuid, Aral, Gazpromneft Zuid-West, operating in ports of St.-Petersburg, Novorossisk, Kaliningrad, Murmansk. In August Gazpromneft Marine Bunker bought the new tanker Gazpromneft Zuid-West for operations in the Black Sea, port Novorossisk. Date of construction of a vessel is 2004, earlier the tanker worked in a northwest part of the Europe on bunkering and transportations. The new tanker meets the requirements of all international regulations. Where: Gazpromneft Marine Bunker is represented in Main Sea Ports of Service in Russia, constantly expanding its geography. On 31 August Gazpromneft Marine Bunker has carried out the first bunkering on Sakhalin island, port Korsakov. • Main Sea Ports of operations: Saint-Petersburg, Kaliningrad, Murmansk, Archangelsk, Novorossisk, Tuapse, Port Kavkaz, Nakhodka, Vladivostok, Vostochnyi and Sakhalin island. • Main River Ports of operations: Saint-Petersburg, Yaroslavl, Kazan, Volgograd, Rostov-on-Don, Astrakhan, Azov, Ust-Kut, Nizhniy Novgorod. • International ports: Tallin, Riga, Klaipeda, Rostok, Konstanca The main strategic goal of Gazpromneft Marine Bunker is to enter the international bunkering markets of Europe and Asia. The first step in this direction was made at the end of 2010, when the first international bunker service was provided in the port of Istanbul (Turkey). Our clients: About 70% of the company’s services are provided for foreign shipowners. Gazpromneft Marine Bunker has contracts with major international shipping companies and traders operating in the ports of Russia. Russian shipowners are major sea and river shipping companies, as well as fishing companies. Our products: A wide range of high quality marine fuels is produced at Gazpromneft subsidiary – Omsk Oil Refinery, which is the main supplier for Gazpromneft Marine Bunker. From April 2010 a low-sulphur (less than 1%) TAS-380 marine fuel has been produced which has made Gazpromneft Marine Bunker a major bunkering company in the low-sulphur fuel oil market. Operating results: Since the date of foundation the company increased its operations nearly twice, having delivered 875,000 tonnes of fuel in the year 2008 and 1500,000 tonnes in the year 2010. In 2010 Gazpromneft Marine Bunker became on of the leading companies of the Russian bunker market increasing its sales by 17%. Vasiliyevsky Island, 3rd line, 62A, St Petersburg, Russia, 199178 Tel: +7 (812) 449 49 70 Fax: +7 (812) 449 49 71 E-mail: bunkers@spb.gazprom-neft.ru

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Vilma Oil S.L. Madrid

ilma Oil commenced physical bunker supply operations at the Spanish port of Ceuta in 2008 as a natural extension of its established trading activities and capabilities. Strategically located in the Strait of Gibraltar, one of the world’s busiest seaways, Ceuta is one of the Mediterranean’s most popular bunkering stations. In just three years Vilma has increased the Port’s bunker volumes by 30%, with over 1,000 additional vessel calls. Already supplying around 40% of all physical deliveries, the company has augmented the port’s income and generated several new jobs. As a foundation to its logistics service, Vilma has the exclusive use of 83,500 cu m of oil storage facilities on a term basis. The installation is connected to the Levante wharf, from which the company operates its ex-Wharf bunker service, loads the bunker tankers, and conducts its import/export cargo trading activity. In order to meet its customers’ needs, and in line with its commitment to continuous development, Vilma Oil time-chartered a modern double-hull 3,420 dwt bunker vessel for supplies at the designated anchorage within the port limits of Ceuta North Bay. Enhancement of delivery capabilities will be made in line with our continued expansion. Optimising the ex-Wharf and anchorage delivery facilities to meet varying customer requirements, Vilma provides RMG380, RMG380 low sulphur, RME180, RME-180 low sulphur, and DMA 0.1%S, meeting ISO 8217 specifications. Combining the exclusive storage facility, berth and bunker vessel capabilities with its long-standing international trading and operational competencies, Vilma continues to expand its vision of providing enhanced customer focused activities, based on core principals of ‘secure quality services’. Vilma Oil aims for continuous improvement and sustainable performance, aligning its strategic direction accordingly. The company will continue to invest in improving logistics to ensure capacities are synchronised with its vision for growth.

Calle Chile, 10, Oficina 236, 282900 Las Matas, Madrid Tel: +34 91 630 8900 Fax: +34 91 630 8901 E-mail: Bunkers@Vilmaoil.com www.Vilmaoil.com

World Bunkering WINTER 2011 issue World Bunkering’s Winter Issue will include highlights of IBIA’s Annual Convention. So if you can’t join us in Barcelona you will still be able to catch up on the main issues discussed and the decisions taken. Our Convention Review will include a report on the big debate; on whether IBIA should lobby IMO to postpone the 0.1% sulphur cap which is due to come into force in Emission Control Areas in 2015. In addition we will be covering our usual wide range of topics, including:

Special Features:

Blending The publication of IBIA’s guidelines on in-line blending coincide with this issue of World Bunkering. We look at the background and also consider the possibilities of onboard-ship blending.

Fuel Additives At a time when the shipping industry is under great pressure to improve fuel efficiency we look at what the additive manufacturers have to offer.

Barge Design We look at what factors owners have in mind when ordering new barges. To what extent do price considerations override optimal technical performance.

Geographical Focus: Americas In North America the impending Emissions Control Area is the big story but what factors affect the markets in Central and South America. We look at how the South American suppliers are faring as the regional economy starts to pick up.

Africa Our annual survey of this vast continent again looks at its various, distinct markets. New players continue to enter the West African offshore market while South Africa’s bunker industry has had to cope with strikes and the continued problem of limited avails.

Regular Features Interview, Industry News, Environment, Testing, Risk Management, Russian Update, Legal News, Equipment and Services, Diary.

ENErGY of GROWTH • • • •

High quality ISO 8217-2010 bunker fuel Quality control from oil refinery plant to end user Flexible prices Main Sea Ports of operations: Saint-Petersburg, Kaliningrad, Murmansk, Archangelsk, Novorossisk, Tuapse, Port Kavkaz, Nakhodka, Vladivostok, Vostochnyi and Sakhalin island • Main River Ports of operations: Saint-Petersburg, Yaroslavl, Kazan, Volgograd, Rostov-on-Don, Astrakhan, Azov, Ust-Kut, Nizhniy Novgorod • International ports: Tallin, Riga, Klaipeda, Rostok, Konstanca

GAZPROMNEFT MARINE BUNKER Ltd Saint Petersburg Office: Vasiliyevsky Island, 3rd line, 62A, Saint-Petersburg, Russia, 199178 Tel: +7 (812) 449 4970 Fax: +7 (812) 449 4971 E-mail: bunkers@spb.gazprom-neft.ru

Main Office: 14, Krzhyzhanovskogo street, Building 3, Moscow, Russia, 117218, Tel: +7 (495) 213 04 36 Fax: +7 (495) 213 04 37 E-mail: marinebunker@gazprom-neft.ru