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ENGINE: East of Suez Bunker Fuel Availability Outlook

Prompt VLSFO and HSFO still tight in Singapore; sluggish demand in Zhoushan; several East Asian ports face weather disruptions.

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LATEST ENGINE East of Suez Bunker

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:

7 March, 2023

  • Prompt VLSFO and HSFO still tight in Singapore
  • Sluggish demand in Zhoushan
  • Several East Asian ports face weather disruptions

Singapore

Singapore has been witnessing average demand so far this week. Availability of VLSFO and HSFO is getting tighter in the port. Some suppliers have limited stocks as they are obligated to supply bunkers to meet term contracts. Lead times of 5-8 days are recommended for VLSFO - almost same as last week. HSFO lead times have increased from 6-8 days last week, to 7-10 days now.

Availability of LSMGO remains very good in the port, with lead times unchanged at 2-3 days.

Residual fuel oil stocks in Singapore averaged 4% higher in February than in January, the latest data from Enterprise Singapore shows. The stock build was supported by a 1% uptick in net fuel oil imports.

Meanwhile, Singapore’s middle distillate stocks declined by 11% in February.

East Asia

Prompt availability of VLSFO remains slightly tight in Zhoushan as most suppliers are running low on stocks and replenishment cargoes have been delayed. But a lack of demand has prevented further tightening, a source says.

VLSFO and LSMGO stems require 3-5 days of lead time in the port, and HSFO needs 5-7 days. Lead times are unchanged from last week across all grades in Zhoushan.

Hong Kong continues to grapple with sluggish demand, a source says. Availability of all grades is normal to tight, with lead times of around seven days recommended - up from 5-6 days previously.

Strong wind gusts of 19-27 knots and waves of almost a metre are forecast to hit Hong Kong on 12 March, which might disrupt bunkering.

Bad weather is forecast intermittently in the South Korean ports of Ulsan, Onsan, Daesan, Taean and Yeosu between 9-12 March, which might impact bunker operations.

Demand has been average across South Korean ports so far this week. Availability is very tight for all grades in the country's southern ports as most suppliers are running low on stocks, a source says. Lead times in southern ports vary widely between 5-12 days - almost the same as last week's 3-11 days.

Meanwhile, availability across all grades has improved in western South Korean ports, with much shorter lead times of 4-5 days recommended, down from 3-11 days previously.

Both the Philippine port of Subic Bay and the Thai port of Leam Chabang are forecast experience adverse weather conditions on 14 March, which might hamper bunkering.

The Vietnamese port of Ho Chi Minh City faces rough conditions and potential bunker suspensions throughout this week, and the northern Vietnamese port of Hai Phong on 12 March.

South Asia

VLSFO and LSMGO availability remains good in India's Mumbai, Visakhapatnam and Kandla, with short lead times of 2-3 days.

Cochin and Chennai on the southern coast of India also have good availability, while VLSFO and LSMGO remain subject to enquiry in Tuticorin and Haldia. A supplier in Paradip is almost out of VLSFO.

A supplier can offer both VLSFO and LSMGO in the Sri Lankan port of Colombo, with lead times of around five days recommended.

Middle East

Bunker availability remains under pressure for all grades in Fujairah, while demand has been weak, a source says. VLSFO and LSMGO stems require around 10-11 days in the UAE port, which is up from nine days last week. But lead times for HSFO are down from about 12 days to eight days now.

While LSMGO remains readily available in Sharjah, VLSFO has been running low, a source says.

Prompt dates are readily available for LSMGO in the Omani ports of Muscat, Salalah, Sohar and Duqm.

By Tuhin Roy

 

Photo credit and source: ENGINE
Published: 8 March, 2023

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Methanol

Kambara Kisen orders methanol dual-fuel bulker from Tsuneishi Shipbuilding

Firm ordered a 65,700-dwt methanol dual-fuel dry bulk carrier with Tsuneishi Shipbuilding; MOL signed a basic agreement on time charter for the newbuilding that is slated to be delivered in 2027.

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Kambara Kisen orders methanol dual-fuel bulker from Tsuneishi Shipbuilding

Japanese shipowner Kambara Kisen has ordered a 65,700-dwt methanol dual-fuel dry bulk carrier newbuilding from Tsuneishi Shipbuilding Co., Ltd, according to Mitsui O.S.K. Lines (MOL) on Wednesday (20 September).

MOL said it signed a basic agreement on time charter for the newbuilding that is slated to be delivered in 2027. 

The vessel will be designed to use e-methanol produced primarily by synthesising recovered CO2 and hydrogen produced using renewable energy sources, and bio-methanol derived from biogas. 

The vessel's design maximises cargo space while ensuring sufficient methanol tank capacity set to allow the required navigational distance assuming various routes, at the same time maximising cargo space. 

MOL added the vessel is expected to serve mainly in the transport of biomass fuels from the east coast of North America to Europe and the U.K. and within the Pacific region, as well as grain from the east coast of South America and the U.S. Gulf Coast to Europe and the Far East.

Details on the time-charter contract:

Shipowner: Kambara Kisen wholly owned subsidiary
Charterer: MOL Drybulk Ltd.
Charter period 2027: -

Details on the newbuilding methanol dual fuel bulk carrier:

LOA: About 200 m
Breadth: About 32.25 m
Draft: About 13.80 m
Deadweight: About 65,700 MT
Hold capacity: About 81,500m3
Shipyard: Tsuneishi Shipbuilding Co., Ltd.

Photo credit: Mitsui O.S.K. Lines
Published: 22 September, 2023

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Methanol

Argus Media: Alternatives may drive methanol market growth

Driven by low-carbon policies and regulations, the transportation sector — especially the marine fuels industry — could be a source of heightened demand, according to Argus.

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RESIZED Argus media

The growth of sustainable alternatives to traditional methanol production sources likely will shape the market over the next several years, industry leaders said this week at the Argus Methanol Forum.

20 September 

Driven by low-carbon policies and regulations, the transportation sector — especially the marine fuels industry — could be a source of heightened demand.

"The aim is to be net zero by 2050 but [those solutions are] expensive today and one of the main challenges to build e-methanol or bio-methanol plants is a huge queue for these pieces of equipment that aren't available," Anita Gajadhar, executive director for Swiss-based methanol producer Proman, said.

Bio-based and e-methanol plants of commercial scale, like Proman's natural gas-fed 1.9 million metric tonne/yr M5000 plant in Trinidad and Tobago, are not ready today.

"But that's not to say 10 years from now they won't be there," Gajadhar added.

Smaller projects are popping up. Dutch fuels and gas supplier OCI Global announced plans last week to double the green methanol capacity at its Beaumont, Texas, facility to 400,000 t/yr and will add e-methanol to production for the first time. Production will use feedstocks such as renewable natural gas (RNG), green hydrogen and biogas.

The globally oversupplied methanol market will not get any major supply additions starting in 2024 until 2027. But that oversupply will not last long, Gajadhar said.

Global demand has slowed this year, driven by stagnate economic growth and higher interest rates, according to industry observers.

As much as half of methanol demand is tied to GDP growth, with total methanol demand estimates at 88.9mn t globally in 2023. This is essentially flat from 2022, but up from 88.3m t in 2021 and 87.7mn t in 2020, Dave McCaskill, vice-president of methanol and derivatives for Argus Media's consulting service, said.

Demand is not expected to rebound to 2019 levels of 89.6mn t until 2024 or 2025, he added.

The period of oversupply combined with lackluster demand places methanol in a transition period, Gajadhar said, which opens the door for sustainable feedstock alternatives to shape market growth.

Danish container shipping giant Maersk and French marine logistics company CMA-CGM announced earlier this week a partnership to drive decarbonization in shipping. The partnership seeks to develop fuel and operations standards for bunkering with alternative fuels. The companies will develop net-zero solutions, including new technology and alternative fuels.

Maersk has previously ordered dual-fuel methanol-powered vessels and CMA-CGM LNG-propelled vessels.

The demand for alternative feedstock-derived fuels is there, but the ability to scale-up such production lags. Certified lower-carbon methanol produced using carbon capture and sequestration — also known as blue methanol— can ramp up much more quickly, according to Gajadhar.

By Steven McGinn

Photo credit and source: Argus Media
Published: 22 September, 2023

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Biofuel

Royal Caribbean completes over 12 weeks of bio bunker fuel testing in Europe

Firm expanded its biofuel testing this summer in Europe to two additional ships — Royal Caribbean International’s “Symphony of the Seas” and Celebrity Cruises’ “Celebrity Apex”.

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Royal Caribbean completes over 12 weeks of bio bunker fuel testing in Europe

Royal Caribbean Group on Tuesday (19 September) said it successfully completed over 12 consecutive weeks of biofuel testing in Europe. 

Royal Caribbean International’s Symphony of the Seas became the first ship in the maritime industry to successfully test and use a biofuel blend in Barcelona to meet part of her fuel needs. 

The company confirmed onboard technical systems met operational standards, without quality or safety concerns, demonstrating the biofuel blend is a reliable “drop in” supply of lower emission energy that ships can use to set sail across Europe and beyond. 

The tests across Europe also provided valuable data to understand the availability and scalability of biofuel in the region, the firm added. 

Jason Liberty, president and CEO, Royal Caribbean Group, said: “This is a pivotal moment for Royal Caribbean Group’s alternative fuel journey.”

“Following our successful trial of biofuels this summer, we are one step closer to bringing our vision for net-zero cruising to life. As we strive to protect and promote the vibrant oceans we sail, we are determined to accelerate innovation and improve how we deliver vacation experiences responsibly.”

President of the Port of Barcelona, Lluís Salvadó, said: “Royal Caribbean’s success is a clear example of how commitment to innovation makes possible the development of solutions to decarbonise the maritime sector.”

“In this case, it involves the cruise sector and focuses on biofuels, an area in which the Port of Barcelona is already working to become an energy hub, producing and supplying zero carbon fuels, such as green hydrogen and ammonia, and of other almost zero-carbon alternative fuels, such as methanol, biofuels or synthetic fuels. Innovation and collaboration between ports and shipping companies is key to accelerate the decarbonisation of maritime transport.”

The company began testing biofuels last year and expanded the trail this summer in Europe to two additional ships — Royal Caribbean International’s Symphony of the Seas and Celebrity Cruises’ Celebrity Apex

The sustainable biofuel blends tested were produced by purifying renewable raw materials like waste oils and fats and combining them with fuel oil to create an alternative fuel that is cleaner and more sustainable. The biofuel blends tested are accredited by International Sustainability and Carbon Certification (ISCC), a globally recognized organization that ensures sustainability of biofuels and verifies reductions of related emissions.

With Symphony of the Seas departing from the Port of Barcelona and Celebrity Apex departing from the Port of Rotterdam, both ships accomplished multiple sailings using biofuel and contributed critical data on the fuel’s capabilities. 

“These results will help accelerate Royal Caribbean Group’s plans to continue testing the use of different types of biofuels on upcoming European sailings this fall. The company is exploring strategic partnerships with suppliers and ports to ensure the availability of biofuel and infrastructures to advance the maritime energy transition,” the firm said. 

Photo credit: Royal Caribbean Group 
Published: 22 September, 2023

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