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Hill Dickinson: Ongoing LSFO sediment issues lead to bunker alerts

Bunker quality claims are not new to the industry, but these claims going global indicate an issue with the stability of low sulphur fuel.
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The following article discussing potential legal issues from bunker quality claims has been written by Beth Bradley of international legal firm Hill Dickinson; the article has been shared with Manifold Times:

It is nearly a month from the implementation date of regulation 14.1.3 of Marpol Annex VI, and while it is too early to draw concrete conclusions, a nuanced picture is emerging of the effect of the change.

Regulation 14.1.3 Marpol Annex VI, lowers the sulphur content for marine fuel for use onboard vessels not fitted with exhaust gas cleaning equipment from 3.5% m/m to 0.50% m/m and took effect of 1 January 2020 (the sulphur cap). Regulation 14.4.3 Marpol Annex VI limiting sulphur content to 0.10% m/m in Emission Control Areas remains in place.

In the opening weeks of 2020 there have been very few reports of enforcement action taken against vessels for noncompliance with the sulphur cap. Consequently, the transition has been smoother than expected from a port state control perspective. This is in no small amount attributable to the efforts of the key stakeholders (owners, charterers, insurers and bunker suppliers) to prepare to be compliant as of 1 January 2020.

While this suggests a high level of compliance, it is only part of the picture. Claims relating to the sulphur content of fuel as well as the quality of some blended low sulphur fuels are already being made.

Compliance with regulation 14.1.3 means using a fuel with a sulphur content of 0.50% m/m maximum. If the sulphur content exceeds that threshold, owners may be exposed to enforcement action. Consequently, the frequency of owners having samples tested for sulphur content has increased. Where the bunkers are found to be marginally in excess of the limit, problems are arising largely owing the difference between regulation 14.3.1 and most supply contracts. An on-specification supply for sulphur content will, usually, from a suppliers point of view be deemed to be up to 0.53% m/m, since that reflects the laboratory margin of confidence for testing. As a result, a time-consuming and costly stand-off can occur while the sulphur content issue is resolved and decisions made regarding the need to de-bunker and obtain alternative bunkers.

In addition, over the past four weeks there have been a number of alerts issued concerning sediment issues, in particular, in low sulphur fuels supplied in Singapore, Piraeus, Amsterdam, Rotterdam, Miami and San Vincente. The propensity to sediment can cause engine problems, from sludging of filters to engine damage and blackouts in the worst circumstances.

Quality claims relating to bunkers are not a new phenomenon, but in the past, they have tended to be localised. The spread of alerts concerning sediment, suggests a potentially wider issue concerning the stability of some blended low sulphur fuel. 

Liability, depending on the reasons for sedimentation, may not be straightforward. While charterparties and bunker supply contracts will contain a specification for the fuel, usually by reference to the ISO 8217 standard, some organic compounds which cause sedimentation may not be caught by the Table 2 parameters (although the issue may be caught by clause 5.3 of ISO 8217).

Where shipowners have devolved the responsibility to provide bunkers to the vessel to their time charterers, the time charterers obligation as a matter of English law is twofold; (a) to provide bunkers in accordance with the contractual specification and (b) to provide bunkers which are fit for purpose.  As such, if the bunkers are within specification but are causing sedimentation, or are otherwise not fit to be consumed by the vessel, owners will have recourse against their time charterers.

The position is not necessarily the same under bunker supply contracts, particularly if there are clear provisions excluding claims relating to fitness for purpose, which can make it difficult to pursue the supplier.

From a practical point of view, the usual advice to owners to ensure that they have clean bunker tanks, avoid co-mingling of bunkers and to monitor sampling during the supply applies. Time charterers arranging the supply of bunkers (or owners if dealing direct with the suppliers) need to ensure that they understand the supply contract and have the time bar and sampling provisions firmly in mind in order to preserve their rights of recourse against the supplier, if available.

Looking ahead, enforcement action and quality issues will remain live topics as the shipping industry adjusts to the sulphur cap, the next pinch point will be Sunday 1 March 2020 when the carriage ban takes effect.  While the use onboard of high sulphur fuel is now impermissible unless the vessel is fitted with exhaust gas cleaning systems, high sulphur fuel may be carried until 1 March. Owners have a little over a month in which to arrange to de-bunker high sulphur fuel and would be best advised to start planning those operations (if not already in hand) now, so as to avoid the consequences of missing the deadline.


Source: Hill-Dickinson
Published: 7 February, 2020

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Winding up

Singapore: High Court to hear Norvic Shipping Asia winding up application on 31 July

Application for the winding up of Norvic Shipping Asia Pte Ltd was filed by Netherlands-registered Mur Shipping BV on 8 April, according to Government Gazette notice.
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July 22, 2026

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An application for the winding up of Norvic Shipping Asia Pte Ltd was filed by Netherlands-registered Mur Shipping BV on 8 April, according to a Tuesday (21 July) notice on the Government Gazette.

It noted the winding up application is directed to be heard before the Judge sitting in the General Division of the High Court at 10am on 31 July.

Any creditor or contributory of the company desiring to support or oppose the making of an order on the winding up application may appear at the time of hearing by himself or his counsel for that purpose.

A copy of the winding up application will be furnished to any creditor or contributory of the company requiring the copy of the winding up application by the solicitors of the applicant’s, Oon & Bazul LLC, on payment of the regulated charge for the same.

The Applicant’s address is Hiridostraat 5, Gebouw Prismatrium, 1101CW Amsterdam, The Netherlands.

The Applicant’s solicitors are Oon & Bazul LLC of 103 Penang Rd, #04-04/05/06 Singapore 238467. 

Queries on the winding up application may be directed to the following email addresses: [email protected] and [email protected].

 

Photo credit: Manifold Times
Published: 22 July, 2026

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Methanol

World Fuel and partners complete first green methanol bunkering of car carrier in Shanghai

Operation involved the delivery of approximately 2,800 MT of green methanol to “Arctic Tern” via a ship-to-ship transfer using SIPG Energy’s dedicated methanol bunkering vessel “M/V Hai Gang Zhi Yuan”.
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July 22, 2026

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World Fuel and partners complete first green methanol bunkering of car carrier in Shanghai

Marine fuel provider World Fuel on Tuesday (21 July) said it successfully completed the first green methanol bunkering of M/V Arctic Tern, with EUKOR Car Carriers and SIPG Energy at the Port of Shanghai. 

Arctic Tern is the first vessel in the new Shaper Class series of car carriers. 

The operation involved the delivery of approximately 2,800 MT of green methanol to Arctic Tern via a ship-to-ship transfer using SIPG Energy’s dedicated methanol bunkering vessel M/V Hai Gang Zhi Yuan, the largest vessel of its kind in operation. 

The bunkering operation was carried out at Haitong Terminal, Waigaoqiao Port Area, Shanghai Port, with cargo handling operations conducted simultaneously during bunkering.

This marks EUKOR Car Carriers’ first green methanol operation and the first time Arctic Tern has bunkered methanol since its delivery on 9 July. The operation marked the first bunkering at Shanghai Port of green methanol produced locally in Shanghai for an international PCTC operator. 

It also demonstrated the city’s integrated green methanol value chain, spanning local production, storage and bunkering, and established a replicable “Shanghai Model” for green methanol supply.

World Fuel arranged the supply and delivery of the fuel on behalf of EUKOR Car Carriers, working with SIPG Energy as the physical supplier at the Port of Shanghai.

The green methanol supplied was produced from municipal solid waste, ISCC-EU certified, and had a carbon intensity value below 25 gCO₂e/MJ.

Arctic Tern is the first of fourteen Shaper Class vessels ordered by Wallenius Wilhelmsen. With a capacity of 9,300 car equivalent units and methanol dual-fuel capability, the vessel will be operated by EUKOR Car Carriers, jointly owned by Wallenius Wilhelmsen and Hyundai Motor Group. Following her first green methanol bunkering, Arctic Tern will continue her maiden voyage from Asia to Europe.

Xavier Leroi, COO Shipping Services at Wallenius Wilhelmsen and CEO of EUKOR Car Carriers, said: “Completing Arctic Tern’s first green methanol bunkering shortly after delivery is a significant milestone towards our decarbonisation ambition for both EUKOR Car Carriers and Wallenius Wilhelmsen. It demonstrates how investments in next-generation vessel technology and fuel flexibility are being translated into real-world operations. 

“This achievement reflects the strong collaboration between all parties involved. Together, we have shown how partnerships across the maritime value chain can help make lower-emission fuels available and operationally viable at scale.”

Mark Tamsitt, SVP Global Marine Sales at World Fuel, said, “The first bunkering event with a new fuel is a significant moment for any shipowner, and our role is to make it as seamless as possible. By connecting EUKOR Car Carriers with SIPG Energy’s proven green methanol capability at the Port of Shanghai, we were able to deliver on reliable supply, fuel quality, and safe processes. As more of our customers bring methanol dual-fuel tonnage into service, we are committed to being the partner that makes these kinds of operations routine.”

Mr. Zhang Da, General Manager of SIPG Energy, said, “Welcoming Arctic Tern to the Port of Shanghai for her first green methanol bunkering demonstrates the strength and maturity of our supply capability. Building on our well-established methanol ship-to-ship bunkering services for container vessels, we have already extended such services to pure car and truck carriers (PCTCs). This bunkering sets a new record for the largest single SIMOPs green methanol bunkering for PCTCs in China, marking another step in building Shanghai’s position as a global green energy hub for international shipping.”

This operation follows Wallenius Wilhelmsen’s announcement on 9 July that Arctic Tern would complete her first methanol bunkering shortly after delivery. The vessel entered service on routes between Asia and Europe immediately following handover from China Merchants Jinling Shipyard in Nanjing.

 

Photo credit: World Fuel
Published: 22 July, 2026

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Ammonia

HPA and MB Energy develop safety concept for STS ammonia bunkering

HPA says the Port of Hamburg will become “bunker ready” for ammonia, laying the groundwork for safe and reliable ammonia bunkering in the future.
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July 22, 2026

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HPA and MB Energy develop safety concept for STS ammonia bunkering

The Hamburg Port Authority (HPA) and integrated energy company MB Energy on Tuesday (21 July) said they have completed a comprehensive risk analysis and developed a dedicated safety concept for ship-to-ship ammonia bunkering.

MB Energy said the analysis lays the groundwork for the safe introduction of ammonia as a future marine fuel.

“With our planned ammonia import terminal in Hamburg-Blumensand, MB Energy intends to provide the reliable land side supply infrastructure needed to support this transition across northern German ports,” it said in a social media post. 

Mabanaft Group was renamed to MB Energy last year and merged over 50 existing brands under one identity. 

Separately, HPA said the Port of Hamburg will become “bunker ready” for ammonia, laying the groundwork for safe and reliable ammonia bunkering in the future.

“The focus is in particular on container ships, cruise ships as well as RoRo and ConRo (Container/RoRo) ships,” it said. 

“We expect ammonia to establish itself as an alternative marine marine fuel in the coming years. With our preparatory work, we are already creating the conditions to welcome the first ammonia-powered ships in Hamburg and to bunker them safely.:

HPA added that the import terminal for ammonia planned by MB Energy from 2029 will make a decisive contribution to ensuring the reliable availability of ammonia as a bunker fuel in northern German ports in the long term. 

“The use of an ammonia bunker barge is considered a possible addition to the landside infrastructure to enable ship bunkering in the port and beyond in the future,” it said.

Related: Mabanaft Group renames as MB Energy, merging over 50 brands under one identity

 

Photo credit: Hamburg Port Authority
Published: 22 July, 2026

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