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ENGINE on Fuel Switch Snapshot: Costlier Brent pushes VLSFO higher

VLSFO prices rise sharply with Brent; LNG $300/mt cheaper than biofuel in Rotterdam.

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ENGINE on Fuel Switch Snapshot: Costlier Brent pushes VLSFO higher

Once a week, bunker intelligence platform ENGINE will publish a snapshot of alternative and conventional bunker fuel prices in the world’s two biggest bunkering hubs. The following is the latest snapshot: 

  • VLSFO prices rise sharply with Brent
  • LNG $300/mt cheaper than biofuel in Rotterdam

8 April 2024

VLSFO

Rotterdam and Singapore's VLSFO benchmarks have risen sharply in the past week, tracking ICE Brent futures' steep rise of $4.49/bbl ($32.91/mt).

Rotterdam's VLSFO benchmark has gone up by $29/mt. Availability of the fuel grade remains normal in the port and 4-5 days of lead time are still recommended.

Singapore’s VLSFO benchmark has increased by $15/mt. Its VLSFO availability remains tight for prompt delivery. Most suppliers recommend lead times of up to 14 days, but some can accommodate stems within five days in the port.

Biofuels

Rotterdam’s B24-VLSFO HBE bunker price has surged by $26/mt in the past week. Biofuel bunker demand in the port has been stable in the spot market, one source says. Another source has not seen any demand recently.

A palm oil mill effluent methyl ester (POMEME) cargo was priced at $1,405/mt in the ARA region on Friday, according to PRIMA Markets. This price has gained around $19/mt over the past week, PRIMA Markets said. POMEME-based biofuels can qualify for advanced biofuel rebates through the Dutch HBE system.

Singapore’s B24-VLSFO UCOME bunker price has climbed $14/mt higher over the past week.

“A domestic producer of the renewable fuel pinned the offer and asking price for UCOME FOB China in bulk ‘strongly’ at $1,050/t [$1,050/mt],” PRIMA Markets reported. “Other sources reported increasingly higher offer levels for same product up to $1,100/t [$1,100/mt], highlighting uncertainty in assigning valuation, as producers and traders in the East Asian country continue to see little demand or interest for trades.”

Singapore relies heavily on Chinese UCOME imports and higher Chinese UCOME prices can raise UCOME prices in the Singapore market.

LNG

Rotterdam’s LNG bunker benchmark has declined by $10/mt in the past week. The price has mirrored a $11.99/mt fall in the front-month NYMEX Dutch TTF Natural Gas benchmark and comes amid persistently high gas storage levels.

European gas storage levels are at 58% and have exceeded expectations, ING's Warren Patterson commented. He pointed to milder weather in the northern hemisphere capping draws.

Low seasonal demand in "shoulder months" like April will usually weigh down on LNG prices, a trader points out.

Rotterdam’s LNG discount to its VLSFO has widened by $39/mt to $170/mt over the week. Its LNG bunker price is now more than $300/mt cheaper than its B24-VLSFO benchmark price.

Singapore’s LNG bunker benchmark has remained unchanged in the past week. Singapore’s LNG discount to its VLSFO has widened by $15/mt to $113/mt in the past week.

By Konica Bhatt and Erik Hoffmann

 

Photo credit and source: ENGINE
Published: 9 April 2024

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Methanol

VPS conducts assessment on first SIMOPS methanol bunkering op in Singapore

Firm was appointed by OCI Methanol Europe to conduct a quantity and quality assessment of a methanol bunker fuel delivery to “Eco Maestro” in Singapore.

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VPS conducts assessment on first SIMOPS methanol bunkering op in Singapore

Marine fuels testing company VPS on Tuesday (28 May) said it was appointed by OCI Methanol Europe, part of the OCI Global Group, to conduct a quantity and quality assessment of a methanol fuel delivery to Eco Maestro in Singapore.

Captain Rahul Choudhuri, President Strategic Partnerships, VPS, said VPS survey experts Rafael Theseira and Muhd Nazmi Abdul Rahim were at hand during the methanol bunkering to ensure the 300 metric tonnes of methanol transfer was carried out smoothly, having been involved in the first methanol bunkering a year ago. 

Manifold Times recently reported X-Press Feeders, Global Energy Trading Pte Ltd (GET), and PSA Singapore (PSA) successfully completing the first simultaneous methanol bunkering and cargo operation (SIMOPS) in Singapore.

A X-Press Feeder container vessel, Eco Maestro, on its maiden voyage from Asia to Europe was successfully refuelled with close to 300 mt of bio-methanol by GET, a MPA licensed bunker supplier, using MT KARA

The ISCC-certified bio-methanol used for the SIMOPS was produced by green methanol producer OCI Global and supplied via GET, a ISCC-certified supplier.

Captain Choudhuri said the role of the marine, petroleum or bunker surveyor has evolved over the years in shipping and maritime affairs, but the principles have not - and that is to provide independent assessment of the quality and quantity of the product transfer. 

“This may seem obvious but this quality and quantity control is crucial to avoid commercial discrepancies, shortages or fraud,” he said.

“Safety training is critical and we have been on top of this having completed the required MPA fire-fighting course and the IBIA Methanol training course. We will work more with the Singapore Maritime Academy for trainings in future,” he added.

In August last year, Singapore-headquartered independent common carrier X-Press Feeders launched its first ever dual-fuel vessel Eco Maestro in China.

Manifold Times previously reported VPS stating it was the first company to complete a methanol bunker quantity survey (BQS) operation in Singapore on 27 July last year.

VPS was appointed by Maersk and Hong Lam Marine Pte Ltd, to undertake the very first bunker quantity survey (BQS) of a methanol fuel delivery, supplied by Hong Lam to the Maersk vessel on its maiden voyage to Europe. 

Related: First SIMOPS methanol bunkering operation completed in Singapore
Related: VPS completes quantity survey on Singapore’s first methanol bunkering op
Related: Singapore bunkering sector enters milestone with first methanol marine refuelling op
Related: X-Press Feeders launches its first methanol dual-fuel vessel “Eco Maestro” in China

 

Photo credit: VPS
Published: 29 May 2024

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LNG Bunkering

Gasum and Equinor ink continuation of long-term LNG bunkering agreement

Agreement builds on the success of the previous contract Gasum has had with Equinor; Gasum’s bunker vessels “Coralius”, “Kairos” and “Coral Energy” will be used for the bunkering operations.

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Gasum and Equinor ink continuation of long-term LNG bunkering agreement

Nordic liquefied natural gas (LNG) bunker supplier Gasum on Tuesday (28 May) said it signed a long-term contract with Norway-based global energy company Equinor whereby Gasum continues to supply LNG to Equinor’s dual-fuel chartered fleet of vessels. 

The agreement builds on the success of the previous contract Gasum has had with Equinor. Gasum’s bunker vessels Coralius, Kairos and Coral Energy will be used for the bunkering operations.

The agreement also includes additional support services such as cooling down and gassing up, which has also been a part of Gasum’s previous collaboration with Equinor. 

Gasum has organised three separate LNG cool down operations for Equinor in Skagen so far this year.

Both Gasum and Equinor have committed to sustainability goals to enable a cleaner energy future. Equinor’s ambition is to become a net-zero emissions energy company by 2050.

Using LNG in maritime transport means complete removal of sulfur oxides (SOx) and particles, and reduction of nitrogen oxides (NOx) emissions of up to 85 percent as well as a reduction in CO2 emissions by at least 20%. LNG is interchangeable with liquefied biogas (LBG/bio-LNG), which reduces carbon dioxide emissions by 90% compared to conventional fuel such as marine gasoil (MGO).

With LNG and bio-LNG the maritime industry can reduce emissions already today, instead of waiting for future solutions. Gasum’s strategic goal is to bring yearly seven terawatt hours (7 TWh) of renewable gas to market by 2027. Achieving this goal would mean combined carbon dioxide reduction of 1.8 million tons per year for Gasum’s customers.

Related: Equinor Energy AS extends LNG bunkering agreement with Gasum
Related: Gasum expands LNG bunkering business to ARA region through partnership with Equinor

 

Photo credit: Gasum
Published: 29 May 2024

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Methanol

Consortium inks MoU for facility in Egypt to produce green methanol bunker fuel

AD Ports Group, Transmar and Orascom Construction will develop a green methanol storage and export facility, which will provide bunkering solutions for mainliners who have ordered green methanol powered vessels.

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Consortium inks MoU for facility in Egypt to produce green methanol bunker fuel

AD Ports Group, a facilitator of global trade, logistics and industry on Tuesday (28 May) said it signed a memorandum of understanding (MoU) with container shipping line and terminal operator Transmar and global engineering and construction contractor Orascom Construction for the development of a green methanol storage and export facility. 

AD Ports Group said the facility will aim to supply low-carbon fuel for maritime transport, presenting an opportunity to establish clean alternative energy storage solutions globally.

Green methanol is a synthetic fuel produced renewably and without polluting emissions, and can be produced from green hydrogen. This chemical compound can be used as a low-carbon liquid fuel and is a promising alternative to fossil fuels in areas where decarbonisation is a major challenge.  

Aside from the maritime industry, green methanol can help decarbonise other hard-to-abate industries, including chemical and plastics. 

“The addition of a facility in this area will provide bunkering solutions for those mainliners who have ordered green methanol powered vessels and is aligned with AD Ports Group’s overall decarbonisation strategy and expansion into clean energy liquid bulk storage,” the Group added.

Captain Ammar Mubarak Al Shaiba, CEO – Maritime & Shipping Cluster, AD Ports Group, said: "By signing this MoU with Orascom Construction who have vast international experience in bulk liquid terminals for Methanol storage, and Transmar, who have decades of expertise in this region and within terminal operations, AD Ports Group and its subsidiaries are taking a significant step towards the sustainable future of energy.”

“This initiative not only aligns with the UAE's decarbonisation goals but also accelerates the energy transition in shipping, positioning us at the forefront of the green hydrogen revolution and enabling us to contribute to global environmental stewardship and economic diversification."

 

Photo credit: AD Ports Group
Published: 29 May 2024

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