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Argus Media: LNG demand may rise with discount to bunkers

Northwest Europe LNG to conventional marine fuels price discount continued to deepen in July, meaning LNG/fuel oil dual-fuel ship owners could cut their bunker expenses by switching to LNG bunker fuel.

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The northwest Europe LNG to conventional marine fuels price discount continued to deepen in July, meaning LNG/fuel oil dual-fuel ship owners could cut their bunker expenses by switching to LNG.

24 July 2023

In June the price of northwest Europe LNG delivered on truck slipped below the price of high-sulphur fuel oil (HSFO) at -$10/t, Argus data showed. The discount widened to -$50/t average from 1-24 July. LNG’s discount to very low-sulphur fuel oil (VLSFO) on 1-24 July was even deeper, at $112/t, from a $81/t discount in June. LNG was also assessed at $300/t discount to marine gasoil (MGO) on 1-24 July, from a $231/t discount in June.

LNG emits “virtually no sulphur oxides (SOx)” when burned, according to LNG energy industry coalition SEA-LNG. Thus LNG can be used in lieu of 0.1pc sulphur MGO in the global emission control areas (ECAs) such as Rotterdam, where marine fuel sulphur content is capped at 0.1pc to keep down SOx emissions. LNG for bunkering demand accounted for 2pc of Rotterdam total marine fuel demand in the first quarter of the year, up from less than 0.3pc in the first quarter of 2022, but down from 5pc in the third quarter of 2021.

Compared with MGO, LNG emits 14pc less CO2 from combustion, according to a 2021 study by the independent, nonprofit organization international council on clean transportation (ICCT). Starting next year, ship owners traveling EU territorial waters will have to pay for 40pc of their emissions from combustion. EU-traded CO2 was assessed at $95/t average on 1-24 July, which would amount to about $17/t in CO2 cost savings for vessels burning LNG instead of MGO.

Europe faces less severe natural gas supply security risks in the run-up to winter 2023-24 than it did ahead of the previous winter. Countries have succeeded in rebuilding stocks and the EU can count on much larger, and growing, LNG import capacity. But Russian pipeline deliveries to Europe are a fraction of what they were before the onset of the war in Ukraine, so supply could still be tight if gas demand rebounds. Thus it is unclear if LNG prices would remain below fuel oil’s this winter.

By Stefka Wechsler

 

Photo credit and source: Argus Media
Published: 28 July, 2023

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Newbuilding

Singapore: Pinnacle Marine’s first B100 fuelled utility boat starts 1,000-hour research trial

Newbuilding operated by Prestige Ocean Pte Ltd will capture data on bunker fuel emissions, marine fuel behaviour, and performance.

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President MT

The 50th vessel constructed by local boat builder Pinnacle Marine (Singapore) Pte Ltd, namely President 100, is starting 1,000 hours of real-time research trials in collaboration with several parties from Wednesday (9 July) onwards, it says.

Powered by B100 biodiesel, the newbuilding operated by Prestige Ocean Pte Ltd will capture data on bunker fuel emissions, marine fuel behaviour, and performance.

It will be participating in trials with Maritime Energy & Sustainable Development Centre of Excellence (MESD), Weichai Singapore, China Classification Society, Pacific International Lines (PTE) Ltd, Abo Shoten, Ltd. / 株式会社安保商店 , Abo Singapore, Wilmar International, Gulf Marine, Amspec Testing & Services, and AYK Engineering and Consulting.

President MT 02

The President 100, Pinnacle Marine’s first full biodiesel utility boat, was launched on Tuesday in the presence of over 100 guests.

“Our latest vessel, President 100, merges legacy and future. Named after our first aluminium boat (“President”) and inspired by B100 biodiesel, it leads the charge for our next 50 vessels — many of which will embrace green technology,” stated Pinnacle Marine in a LinkedIn post.

“The launch was amazing, with strong turnout from across the maritime sector — authorities, shipowners, operators, agencies, chandlers, researchers, offshore engineers, and petrochemical suppliers.”

It added: “We’re excited to see how it paves the way for wider adoption of B100 biodiesel — a cleaner, sustainable path for Singapore’s harbour craft sector.”

 

Photo credit: Pinnacle Marine (Singapore) Pte Ltd
Published: 9 July 2025

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Newbuilding

BHP awards charter contracts for two ammonia dual-fuelled bulk carriers

BHP continues to work with the maritime industry to develop an ammonia bunkering plan for the two vessels when they are delivered from 2028.

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BHP ammonia DF charters

Global resources company BHP on Wednesday (2 July) signed contracts with COSCO Shipping Bulk Co., Ltd., a subsidiary of COSCO shipping Group (COSCO Shipping) for the charter of two ammonia dual-fuelled Newcastlemax bulk carriers.

The new vessels to be built under this arrangement will be two of only a handful of vessels in the world capable of using ammonia as a bunker fuel.

The two vessels, expected to be delivered from 2028, will primarily transport iron ore from Western Australia to Northeast Asia.

When run on lower or low to zero greenhouse gas (GHG) emissions ammonia, these vessels will be capable of reducing GHG emissions by at least 50% and up to 95% on a per voyage basis compared to a conventionally fuelled voyage.

The five-year time charter contracts are expected to contribute towards a reduction in the GHG emissions intensity of BHP chartered shipping.

BHP continues to work with the maritime industry to develop an ammonia bunkering plan – the process of fuelling ships with ammonia – for the two vessels when they are delivered from 2028.

Sourcing lower and low to zero GHG emissions ammonia is subject to an ongoing tender process.

 

Photo credit: BHP
Published: 9 July 2025

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Milestone

China: Chimbusco and BJEC enter green methanol cooperation agreement

Document was signed between Ding Lihai, deputy general manager of Chimbusco, and Li Jianjun, deputy general manager of BJEC.

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China Marine Bunker (PetroChina) Co.,Ltd. (Chimbusco) and POWERCHINA Beijing Engineering Corporation Limited (BJEC) on Thursday (3 July) formally entered into a green methanol strategic cooperation framework agreement.

The document was signed between Ding Lihai, deputy general manager of Chimbusco, and Li Jianjun, deputy general manager of BJEC.

BJEC, a subsidiary of China Power Engineering Group, is experienced in the survey, design, construction and technology research and development of large-scale renewable energy projects.

Moving forward, the two parties said they will respectively focus on their core advantages and work together to promote the production, supply, storage and refuelling of green methanol as an energy source to help support the low-carbon transformation of the shipping industry.

Ding Lihai said: “The shipping industry is one of the important sources of global carbon emissions. Promoting low-carbon fuel is the key to the transformation of the industry. As the main force in the supply of bunker fuel, Chimbusco has been committed to expanding its clean fuel supply capacity. The cooperation with BJEC will integrate the advantages of green energy development and fuel supply, accelerate the large-scale application of green methanol, and meet the needs of shipping companies for clean fuel. We look forward to providing effective solutions for the green transformation of the shipping industry through the joint efforts of both parties.”

Li Jianjun said: “Implementing the ‘dual carbon’ goal is an important responsibility of enterprises. BJEC has accumulated strong technical strength in the field of green energy. This cooperation with Chimbusco will focus on the entire industrial chain of green methanol, from raw materials, production to supply, to provide clean and sustainable fuel solutions for the shipping industry. The complementary advantages of both parties will promote the rapid development of the green methanol industry and inject strong impetus into the low-carbon transformation of the shipping industry.”

 

Photo credit: China Marine Bunker (PetroChina) Co.,Ltd.
Published: 8 July 2025

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