Business

ENGINE: East of Suez Bunker Fuel Availability Outlook

VLSFO and HSFO supply tight in Singapore; availability good in weather-exposed Zhoushan; VLSFO availability improves in South Korean ports.

Published

1 year ago

July 19, 2023

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The following article regarding regional bunker fuel availability outlook for the East of Suez region has been provided by online marine fuels procurement platform ENGINE for publication on Singapore bunkering publication Manifold Times:

18 July 2023

VLSFO and HSFO supply tight in Singapore
Availability good in weather-exposed Zhoushan
VLSFO availability improves in South Korean ports

Singapore

Singapore has been seeing average demand so far this week, a source says. Securing HSFO stems can be difficult in the East Asian bunker hub, with recommended lead times going up marginally, from 9-13 days last week to 11-14 days now. Strong bunker demand last week coupled with a shrinking HSFO net import surplus could have contributed to put pressure on the grade.

Availability of VLSFO has been tightening as well, with several suppliers advising lead times of 7-11 days – up from 6-9 days last week. Availability of LSMGO remains good, with short lead times of 4-7 days recommended.

Singapore’s total residual fuel oil stocks have averaged 9% lower so far this month than in June, according to Enterprise Singapore. Singapore’s net fuel oil imports have surged by two-thirds and are at their highest level in more than a year. Both fuel oil imports and exports have risen in July. The port’s fuel oil imports have risen by a massive 75%, and its fuel oil exports have doubled.

Singapore’s middle distillate stocks have averaged 3% lower this month than in June.

East Asia and Oceania

Zhoushan has ample bunker availability amid sluggish demand and weather-related disruptions, a source says. All grades remain readily available in Zhoushan, with short lead times of 2-5 days – virtually unchanged from last week. However, bunker deliveries are still subject to weather conditions.

Bunkering has been suspended by bad weather at the port’s outer Tiaozhoumen and Xiazhimen anchorages since 9 July. Bunker operations are likely to resume at these anchorages later today, when calmer weather is forecast, the source adds.

Terminal operations across ports in the Guangdong and Hainan province in China were suspended as Typhoon Talim made landfall in the city of Zhanjiang in Guangdong province late last night.

Typhoon Talim is forecast to bring rough weather to Hong Kong and possibly disrupt bunker deliveries. Availability remains good across all bunker fuel grades in the port. Some suppliers are offering all grades with lead times of around seven days – almost unchanged from last week.

Meanwhile, availability of VLSFO has improved in South Korean ports, with lead times of 2-6 days recommended now. The grade was subject to enquiry last week.

Some suppliers, who were offering LSMGO and HSFO at lead times of 6-10 days last week, are now providing both grades at shorter lead times of 2-6 days and 3-4 days, respectively.

Adverse weather conditions are predicted intermittently in the South Korean ports of Ulsan, Onsan, Busan, Daesan, Taean and Yeosu between Tuesday and Sunday, which may impact bunker deliveries.

Bad weather is forecast in the Thai ports of Koh Sichang and Leam Chabang, in the Vietnamese port of Ho Chi Minh between 18-25 July, and in the Kiwi port of Tauranga between 21-22 July. All ports face potential delays to bunker operations.

South Asia

Several Indian ports, including Kandla on the northwest coast, and Cochin and Chennai on the southern coast, have good availability of VLSFO and LSMGO, with short lead times of around 2-3 days.

However, supply of both grades remains subject to availability in the Indian ports of Mumbai, Visakhapatnam and Paradip as it has been recent weeks. Meanwhile, a source says that both grades remain subject to enquiry in Tuticorin port on the southeast coast and Haldia on the east coast.

Rough weather is forecast in the Indian ports of Kandla and Sikka on 22 July, and Kochi and Visakhapatnam between 18-19 July, which could affect bunker operations.

Strong wind gusts of 21-27 knots and waves of more than two metres are predicted to hit the Sri Lankan port of Colombo between Tuesday and Thursday, which could hamper bunker deliveries. A source says VLSFO and LSMGO availability remains good in the Sri Lankan ports of Colombo and Trincomalee, with prompt dates available.

Middle East

Good bunker demand has put pressure on prompt availability for all bunker fuel grades in Fujairah, with recommended lead times of 5-7 days – unchanged from last week. Some suppliers can offer all grades for spot dates, but these deliveries are subject to stem sizes, a source says.

Availability remains good in the other UAE port of Khor Fakkan, with unchanged lead times of 5-7 days recommended.

LSMGO remains readily available in the Omani ports of Duqm, Sohar, Salalah and Muscat, with prompt dates possible.

By Tuhin Roy

Photo credit and source: ENGINE
Published: 19 July, 2023

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Shell MGO bunker heist: Bunker clerk pleads guilty to helping Sentek acquire misappropriated fuel

Wong Wai Meng, who received more than USD 286,000 from Sentek Marine & Trading for his assistance, pleaded guilty to 12 counts of intentionally helping the firm acquire the misappropriated marine gas.

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A bunker clerk, Wong Wai Meng, who received more than USD 286,000 (SGD 384,681) from Singapore-based Sentek Marine & Trading (Sentek) for his assistance, pleaded guilty to 12 counts of intentionally helping the company acquire misappropriated marine gas oil, The Straits Times reported on Friday (29 November).

The 58-year-old Singaporean was employed at the Sentek when he assisted in acquiring more than 28,000 metric tonnes (mt) of the misappropriated fuel worth USD 13.58 million (SGD 18.26 million).

Wong committed the offences over 46 occasions between August 2014 and December 2017.

Wong is among the three bunker clerks previously employed by Sentek, who were charged for offences under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) and the Prevention of Corruption Act (PCA).

Another bunker clerk among the three charged, Wong Kuin Wah, 61, was sentenced to seven years and six months’ jail on 18 November for his role in misappropriating more than 27,000 tonnes of gas oil worth around USD 12.8 million (SGD 17.2 million).

The third individual who was charged, Boo Pu Wen, reportedly passed away in July 2023 and had his charges abated following his death, meaning Boo’s court proceedings over his 19 charges at the time came to an end.

Former Shell employees, who were key members of a group who dishonestly misappropriated fuel from Shell Pulau Bukom, were sentenced to jail in court earlier.

Earlier coverage of developments by Manifold Times regarding the Shell MGO bunker heist can be found below:

Photo credit: Katrin Bolovtsova
Published: 2 December, 2024

Biofuel

Singapore: GCMD introduces new technique for FAME bio bunker fuel fingerprinting

Fingerprinting identifies feedstock origins of FAME-based biofuels used in shipping industry; can be used as a potential tool to detect fraud in marine fuel supply chains and ensure biofuel authenticity.

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Singapore: GCMD introduces new technique for FAME bio bunker fuel fingerprinting

The Global Centre for Maritime Decarbonisation (GCMD) on Monday (2 December) released its latest report, presenting a new technique that creates a fingerprint for Fatty Acid Methyl Esters(FAME) bio bunker fuels.

This fingerprint identifies the feedstock origins of the FAME-based biofuels used in the shipping industry.

GCMD said FAME fingerprinting is needed as the shipping sector is increasingly using biofuels, such as FAME, to reduce its GHG emissions. With that, concerns have arisen regarding the legitimacy of biofuels and whether they are truly sustainable.

Industry bodies are seeing a rising number of cases mislabelling biofuels purported to be made from recycled oils and fats, while suspicions persist that they might be produced from cheaper and less sustainable virgin oils.

“To address these concerns, FAME fingerprinting can be used as a potential tool to detect fraud in marine fuel supply chains and ensure biofuel authenticity. By providing a physical validation method that complements existing certification schemes, FAME fingerprinting can help justify the green premium with genuine environmental benefits and safeguard the integrity of marine fuels supply chain,” GCMD said.

FAME fingerprinting is based on the principle that the fatty acid profile of FAME is unique to its feedstock and can be preserved during feedstock transesterification to produce FAME. The "fingerprint" can then be compared against a database of known fatty acid profiles to identify the feedstock origin.

GCMD worked with VPS who modified existing fuel testing methods to carry out sample analyses using a gas chromatograph with flame-ionisation detection, an instrument commonly found in fuel test laboratories.

The analysis takes about an hour, comparable to the turnaround time for current marine fuel quality testing in the supply chain.

“We have tested this method on a variety of FAME samples from different suppliers, including virgin oils, used cooking oils, palm oil mill effluent, beef tallow and food waste and were able to identify the feedstock origins for each sample,” GCMD added.

Manifold Times previously reported Captain Rahul Choudhuri, President, Strategic Partnerships at marine fuels testing company VPS, forecasting the use of finger printing technology today will likely establish a blueprint of how future alternative bunker fuels’ feedstocks are authenticated.

Captain Choudhuri said this when he gave an update of VPS’ biofuels finger printing trials with GCMD.

Note: The full report, titled ‘Rapid forensic analysis of FAME-based biofuels: Potential use of its fingerprint as a fraud detection tool’, can be downloaded here.

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PLAGEN to produce and supply green methanol bunker fuel with Latvia plant

Korean firm’s MoU with AE Risinājumi will see construction of Latvia’s first commercial-scale green methanol production plant, which will supply green methanol to ships in EU’s maritime fleet.

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PLAGEN to produce and supply green methanol bunker fuel with Latvia plant

South Korean clean energy firm PLAGEN on Friday (29 November) signed an MOU with Latvian company, AE Risinājumi, for the production of green methanol in Latvia at the “2024 Latvia-Korea Business Forum” hosted by the President of Latvia.

The agreement will result in the construction of Latvia's first commercial-scale green methanol production plant, which will supply green methanol to ships in the EU's maritime fleet, contributing to the reduction of greenhouse gas emissions from maritime transportation.

PLAGEN's MoU aims to produce 20,000 metric tonnes (mt) of green methanol per year and will begin feasibility studies in the first half of 2025, and full-scale production will begin in 2028.

With 53% of Latvia's land area covered by forests, timber production and wood processing make a significant contribution to Latvia’s economic production, which generates a large amount of forest residues and wood wastes. In addition, Latvia also has an abundance and low price of renewable electricity from wind power.

Latvia is one of the most competitive countries in the European Union, as it can produce clean methanol at a competitive price by using abundant wood waste as a raw material and renewable electricity from cheap wind power.

The use of abundant forest residues and wood wastes as a feedstock and cheap renewable electricity from wind power makes it possible to produce green methanol with a competitive price, making Latvia is one of the most competitive countries in the EU.

In the European Union, the European Emissions Trading Scheme (EU-ETS) will come into effect in 2025, requiring shipping companies to purchase carbon credits for their greenhouse gas emissions.

In addition, the EU is implementing FuelEU Maritime, which aims to reduce greenhouse gas emissions by 2% below the 2020 average by 2025 and 80% by 2050. This is expected to result in an energy transition to green methanol.

In July 2023, the International Maritime Organization (IMO) adopted a revised strategy that calls for reducing greenhouse gas (GHG) emissions from ships to net-zero by or around 2050, and plans to introduce full-scale regulations from 2027, and shipping companies have begun ordering methanol-powered ships fueled by green methanol, a carbon-neutral fuel.

“We expect to start producing green methanol in Latvia in 2028, which will reduce greenhouse gas emissions from EU maritime transport vessels and contribute significantly to the revitalization of the Latvian economy and national energy security,” said John Kyung, CEO of PLAGEN.

In November 2024, PLAGEN completed the purchase of an industrial complex and received a government permit for the construction of the country's first green methanol plant in Dongjeom Industrial Complex in Taebaek City, Gangwon-do.

The project, which will produce 10,000 mt per year, is scheduled to begin construction in the first half of 2025 and begin production in the second half of 2027.

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