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ENGINE: Europe & Africa Bunker Fuel Availability Outlook (1 May 2024)

Bunker supply normal in the ARA hub; prompt availability good in Las Palmas; VLSFO supply normal in Durban.

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RESIZED ENGINE Europe and Africa

The following article regarding Europe and Africa bunker fuel availability has been provided by online marine fuel procurement platform ENGINE for post on Singapore bunkering publication Manifold Times:

  • Bunker supply normal in the ARA hub
  • Prompt availability good in Las Palmas
  • VLSFO supply normal in Durban

Northwest Europe

Availability of all bunker fuel grades is said to be normal in Rotterdam and in the wider ARA hub. LSMGO is readily available for prompt delivery dates, with recommended lead times of 3-5 days. VLSFO and HSFO grades require slightly longer lead times to ensure full coverage from all suppliers. Lead times of 4-5 days are advised for VLSFO deliveries in the ARA hub, while HSFO requires 4-6 days, according to a trader.

The ARA’s independently held fuel oil stocks have averaged 3% lower in the first four weeks of April than across March, according to Insights Global data.

The region imported 226,000 b/d of fuel oil in April, down from 254,000 b/d in March, according to data from cargo tracker Vortexa. 

The US replaced Mexico as the ARA’s biggest fuel oil import source in April and accounted for 18% of the region’s total imports. The UK ranked second with 15% of the region’s total imports, followed by Mexico (12%), France and Lithuania (11% each).

The ARA hub’s independent gasoil inventories — which include diesel and heating oil — increased by 4% in April. Gasoil stocks rose to their highest levels since June last year. 

Availability is normal in the German port of Hamburg with suppliers offering prompt delivery dates for all bunker fuel grades. Lead times of 3-5 days are recommended for all grades, according to a trader.

Off Skaw, all bunker fuel grades remain in tight supply for the third consecutive week, a trader told ENGINE. Lead times range between 10-14 days there, the trader said. Adverse weather conditions are forecast off Skaw in periods between Wednesday morning and Sunday, which could disrupt bunkering.

Mediterranean

Supply of all bunker fuel grades is good in Gibraltar, with recommended lead times coming down to 3-5 days this week, a trader said. Lead times for all three grades were 4-6 days last week. Congestion has also eased in Gibraltar, a trader said. The port witnessed strong congestion over the last few days due to bad weather conditions. Favourable weather is forecast in Gibraltar over the next few days, which would allow bunker operations to proceed smoothly.

In the Canary Islands’ port of Las Palmas, availability is said to be good with suppliers able to offer all three bunker grades for prompt delivery dates. Bunkering disruptions could arise intermittently in Las Palmas this week as weather is forecast to remain rough until Friday.

Bunker demand in other Mediterranean ports such as Piraeus, Malta Offshore and Istanbul is said to be usual.

Bunkering activity in the Greek port of Piraeus is expected to be minimal during the upcoming Orthodox Easter Holidays from Saturday till Monday, a trader told ENGINE. Availability across all grades in the port is currently subject to enquiry, the trader said. Piraeus has been experiencing rough weather since Tuesday. Bad weather conditions, which are expected to last until Friday, could hamper bunkering there.

Bunker fuel supply is normal across all grades off Malta. VLSFO availability is good, with suppliers offering earliest delivery dates from Thursday onwards, according to a trader. Smooth bunker operations, however, remain subject to weather conditions there, the trader added. Rough weather is forecast off Malta in periods between Wednesday and Friday, which could hamper bunkering.

In Turkey’s Istanbul port, prompt availability of all bunker fuel grades is normal, a trader said.

Africa

Availability of VLSFO is normal in the South African ports of Richards Bay and Durban, a trader said. Lead times of 7-10 days are advised for the grade.

LSMGO availability is also good in Durban, with suppliers offering non-prompt delivery dates there. Lead times of 7-10 days are recommended for optimal coverage from suppliers. Strong wind gusts of up to 22 knots are forecast to hit Durban on Friday. This could impact bunkering there.

Offshore bunker operations have been suspended in Algoa Bay since last September when South African Revenue Service (SARS) detained bunker barges due to import duty disputes. Bunker supply has since then been limited to in-port deliveries by a supplier in Port Elizabeth, where supply is only available by truck.

By Manjula Nair

 

Photo credit and source: ENGINE
Published: 2 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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DNV flag

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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