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ENGINE: Americas Bunker Fuel Availability Outlook (9 May 2024)

Bunkering delayed in Houston; prompt availability is tight in Los Angeles; rough weather disrupts Zona Comun bunkering.

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RESIZED ENGINE Americas

The following article regarding bunker fuel availability in the Americas region has been provided by online marine fuel procurement platform ENGINE for post on Singapore bunkering publication Manifold Times:

  • Bunkering delayed in Houston
  • Prompt availability is tight in Los Angeles
  • Rough weather disrupts Zona Comun bunkering

North America

Bunker demand in Houston for very prompt dates has slowed as barges in the area grapple with delays following the temporary closure of the Houston Ship Channel last Sunday due to flooding.

Despite the channel reopening on Monday evening, suppliers are still working to catch up with deliveries and reload barges from oil terminals. Delays are expected for deliveries in the region until delivery schedules return to normal.

Several suppliers have cancelled their bunker bookings in the affected area for immediate deliveries. Conditions are expected to improve soon, as suppliers are still able to offer VLSFO and LSMGO stems with lead times of 5-6 days, a source says.

Delivery delays have also impacted bunker supply on Bolivar Road, with one supplier offering VLSFO and LSMGO with a lead time of 7-8 days. Securing prompt VLSFO and LSMGO is possible in Beaumont and offshore Beaumont.

Bunkering has been proceeding normally in the Galveston Offshore Lightering Area (GOLA) amid conducive weather conditions. The weather is forecast to remain calm over the weekend and into next week.

Demand has been good for all fuel grades in GOLA. Prompt VLSFO and LSMGO can be secured there, a source says.

Despite weak demand, all grades are tight for very prompt delivery dates in the West Coast ports of Long Beach and Los Angeles. Lead times of more than seven days are generally recommended to avoid pricing premiums in the West Coast ports, a source says.

Prompt VLSFO and LSMGO are available in the East Coast port of New York. However, some buyers are lifting bunkers in the Gulf Coast ports rather than New York, mainly because prices are lower there. As a result, some of the enquiries have been diverted to ports on the Gulf Coast, a source says.

Caribbean and Latin America

The Panamanian port of Cristobal has seen a spike in demand this week as some bunker suppliers have cancelled their bunker bookings in Houston and secured bookings in Cristobal instead. This shift comes in response to the delays observed in Houston, a source says.

Demand in Balboa has also been good, and all the fuel grades can be secured with a lead time of 5-7 days.

VLSFO and LSMGO availability is good in Jamaica’s Kingston. One supplier requires a lead time of at least 3-5 days to deliver stems.

Bunker operations have been suspended in Argentina's Zona Comun anchorage since Wednesday due to strong wind gusts. Calmer weather is forecast on Thursday, which could allow bunkering to resume.

Availability of both VLSFO and LSMGO has been tight in Zona Comun this week.

Major Brazilian ports are grappling with availability challenges. Brazilian petroleum firm and bunker supplier Petrobras will temporarily be unable to provide LSMGO in Rio de Janeiro due to maintenance of its LSMGO supply barge.

The scheduled maintenance will commence on 12 May and continue until mid-June. It will still continue to offer VLSFO in Rio de Janeiro, along with LSMGO in other Brazilian ports such as Paranaguá, Rio Grande, Santos, and Suape.

Brazilian energy firm Raizen is unable to deliver stems in Rio Grande because of severe flooding there. Consequently, the company has redirected its supply operations to Salvador for the stems that were originally booked in Rio Grande. It also plans to offer VLSFO at discounted prices in Salvador.

By Debarati Bhattacharjee

 

Photo credit and source: ENGINE
Published: 10 May 2024

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Methanol

China: CHIMBUSCO Jiangsu completes methanol bunkering operation in Taizhou

Firm successfully delivered 79.5 metric tonnes of methanol bunker fuel to container ship “NCL VESTLAND” using a mobile methanol bunkering skid at Taizhou Sanfu Marine Engineering.

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China: CHIMBUSCO Jiangsu completes methanol bunkering operation in Taizhou

CHIMBUSCO Jiangsu on Tuesday (3 December) said it successfully refuelled the new methanol dual-fuel powered 1,300TEU container ship NCL VESTLAND at Taizhou Sanfu Marine Engineering.

The total amount of methanol bunker fuel delivered to the boxship was 79.5 metric tonnes.

CHIMBUSCO Jiangsu said the implementation of bunkering operation marked a major breakthrough for the company in the application of alternative fuels for ships, marking its ability to supply methanol marine fuel to ships on a regular basis.

A mobile methanol bunkering skid jointly developed by CHIMBUSCO Jiangsu and COSCO (Lianyungang) Liquid Loading & Unloading Equipment was used for the bunkering operation, which was successfully completed in 2.5 hours. 

In a separate statement, COSCO Shipping said the bunkering operation represented CHIMBUSCO Jiangsu’s first marine methanol fuel supply onshore.

The mobile methanol filling skid operates using the pump as its power source to facilitate simultaneous unloading and refuelling tasks. 

This skid includes several key functional modules, each of which is highly integrated. This integration ensures a safe and efficient process for transferring methanol fuel from tankers to a vessel’s fuel bunker, while also enabling seamless operation and intelligent management. 

The mobile methanol filling skid offers flexibility, requires low initial investment, and boasts a rapid bunkering rate of 180 cubic metres (m3) per hour. 

It stands as an optimal solution for methanol bunkering in the era before widespread adoption of methanol bunkering vessels. Additionally, it can provide bunkering support for shipyards to test new vessels and meet the bunkering requirements of the shipyard,” it added. 

 

Photo credit: CHIMBUSCO Jiangsu
Published: 6 December, 2024

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LNG Bunkering

SEA-LNG: Invest more in LNG bunker vessels, supply and liquefaction infrastructure

LNG bunker market, while growing substantially, is lagging and concerns persist regarding the ability to supply the rapidly growing fleet of LNG-fuelled vessels.

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SEA-LNG: Invest more in LNG bunker vessels, supply and liquefaction infrastructure

Industry coalition SEA-LNG on Thursday (5 December) said that while the approximately 2,200 LNG-fuelled vessels and LNG carriers represent only ‘two minutes into the hour’ of the global fleet of approximately 60,000 deep sea vessels, it remains an adolescent fuel that is maturing significantly faster than other alternative bunker fuels. 

However, it said the LNG pathway still needs more investment, especially in landside facilities for liquefaction near ports, bio and synthetic methane production and bunkering capacity worldwide.

This year has witnessed unprecedented investment in the maturing and scaling of LNG from ship owners.  LNG is starting to dominate as the preferred future fuel pathway. 

However, the bunker market, while growing substantially, is lagging and concerns persist regarding the ability to supply the rapidly growing fleet of LNG-fuelled vessels.

Peter Keller, Chairman, SEA-LNG, said: “With high profile owners now choosing the LNG pathway, we anticipate this trend will continue and accelerate through 2025 and beyond.”

“As the various alternative fuel pathways mature, there is a growing realisation that, despite previous aspirations, some alternative fuel pathways – like the LNG pathway – are more practical and realistic than others.”

“While investment in newbuild LNG-fuelled ships is robust, we need to see the same for bunker vessels, supply and liquefaction infrastructure. As the LNG pathway continues to mature and the use of liquefied biomethane and eventually e-methane increases, the delivery of the fuel to vessels must be assured and the investment gap closed.”

Keller added: “There are approximately 60,000 deep sea ships on the water and, today, we’re looking at around 600 LNG capable ships afloat with a further 600 on order. There are another 1,000 LNG cargo carriers and bunker vessels of varying sizes.”

“While that’s a small percentage of the global fleet, as the clock ticks towards shipping’s emissions reduction targets, the LNG pathway is maturing far faster than other alternative fuels.”

According to DNV there are currently 54 methanol vessels and 2 ammonia vessels on the water.

There are aspects of LNG usage that are fully mature – safety for one. LNG is easy to transport, poses minimal, if any, risk to marine environments, has a low flammability range and is non-toxic. Effective regulations, standards and guidelines for safe operations are widespread, and LNG has been shipped around the world for almost 60 years without any major incidents at sea or in ports.

Keller continued: “When compared to traditional fuels, LNG is more of a teenager with all the growing pains, challenges and victories associated with adolescence.”

“But it is maturing all the time as the market continues to grow, new build orders continue to rise, and the LNG pathway with biomethane and eventually e-methane produced from renewable hydrogen, gains acceptance globally.”

“Shipping stakeholders are investing in LNG because it provides a low risk, incremental pathway for decarbonisation, starting now.  The other alternative fuels are basically toddlers by comparison.  And when it comes to safety, some are mere newborns!”

Another critical need in the maturing process during a period of increased regulation of carbon emissions is the adoption of standardised chain of custody models on a worldwide basis. 

Chain of custody models are becoming increasingly important to maritime decarbonisation as they provide mechanisms to verify that the fuels used are low carbon. 

Such verification creates investor confidence in new fuel supply chains and accelerates the transition to low-carbon fuels, enabling early adoption in conditions of limited supply. 

“They will create a market for green fuels by connecting buyers to fuel producers away from bunker ports enabling faster scaling and providing flexibility to shipping companies at lower cost,” SEA-LNG added.

 

Photo credit: SEA-LNG
Published: 6 December, 2024

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Bunker Fuel

Cost-efficient strategies can significantly cut price of FuelEU Maritime compliance, says DNV

Adoption of the most cost-effective strategy can result in savings of up to 16% or USD 21 million over a vessel’s lifetime compared to using Bio-MGO as a compliance option, according to new DNV white paper.

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Classification society DNV on Thursday (5 December) said compliance with FuelEU Maritime requirements will be expensive but applying certain strategies can significantly reduce the cost.

This was one of the main highlights of its latest white paper outlining FuelEU Maritime requirements and compliance strategies for shipowners. 

Effective from 1 January 2025, the rules mandate stringent greenhouse gas (GHG) emission intensity requirements for ships over 5,000 gross tonnage (GT) transporting cargo or passengers for commercial purposes in the EU/ EEA. GHG emissions are calculated from a well-to-wake perspective. In addition to emissions from onboard combustion, this calculation also includes emissions related to the extraction, cultivation, production, and transport of the fuel. 

The regulation includes provisions for crediting ships using wind-assisted propulsion.

The DNV paper provides shipowners with insights to reduce compliance expenses and avoid major penalties. It contains a comprehensive overview of the regulation, including a case study which highlights a range of different compliance strategies. 

This shows how the adoption of the most cost-effective strategy can result in savings of up to 16% or USD 21 million over a vessel’s lifetime compared to using Bio-MGO as a compliance option.

Knut Ørbeck-Nilssen, DNV Maritime CEO, said: “It is essential that shipowners understand the requirements and compliance options related to the FuelEU Maritime regulation to make informed business decisions. Adopting a cost-efficient strategy with the right combination of measures can help shipowners reach compliance at reduced costs.

“Just paying the penalty could prove a more costly option. All parties must understand their potential obligations and privileges, and how these might affect their commercial and compliance agreements. Crucial to this is verified emissions data, which can maintain operational and commercial integrity across the maritime value chain.”

The report provides recommendations for shipowners including securing long-term fuel agreements and implementing energy efficiency measures. It also recommends considering pooling as a mechanism for sharing and optimizing costs. This is underpinned by a call to begin preparations immediately. The report also highlights how, by leveraging digital tools, maritime stakeholders can access verified emissions data, a key factor in compliance and maintaining both operational and commercial integrity throughout the value chain.

A key point emphasized in the report is that the International Maritime Organization is also set to introduce similar regulations in the near future, with a net-zero framework expected to be adopted in the fall of 2025 and come into force around mid-2027.

It is absolutely essential that shipowners understand the requirements and compliance options related to the FuelEU Maritime regulation so that they are equipped to make informed business decisions. Adopting a cost-efficient strategy with the right combination of measures can help shipowners reach compliance and significantly reduce costs.

“Doing nothing and paying the penalty could prove to be a costly option. All parties must understand their potential obligations and privileges, and how these might affect their commercial and compliance agreements. Crucial to this is verified emissions data, which can maintain operational and commercial integrity across the maritime value chain.”

The report provides recommendations for shipowners including securing long-term fuel agreements and implementing energy efficiency measures. It also recommends considering pooling as a mechanism for sharing and optimizing costs. This is underpinned by a call to begin preparations immediately. The report also highlights how, by leveraging digital tools, maritime stakeholders can access verified emissions data, a key factor in compliance and maintaining both operational and commercial integrity throughout the value chain.

A key point emphasized in the report is that the International Maritime Organization is also set to introduce similar regulations in the near future, with a net-zero framework expected to be adopted in the second half of 2025 and come into force around mid-2027.

Note: The full whitepaper titled ‘FuelEU Maritime: Requirements, compliance strategies, and commercial impacts’ by DNV can be downloaded here.

 

Photo credit: DNV
Published: 6 December, 2024

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