Business

Integr8 Fuels publishes its first Bunker Quality Trends Report

Fuel with the highest incidence of off specification continues to be VLSFO at 1.7%, followed by HSFO at 1.2% and MGO at 1.0%, according to the 2022 report.

Published

1 year ago

September 15, 2022

Admin

Integr8 Fuels publishes first Bunker Quality Trends Report

Integr8 Fuels, the bunker trading and brokerage arm of Navig8, on Wednesday (14 September) shared with Manifold Times its first Bunker Quality Trends where it examines and compares likelihood of off specification issues across all commercial grades of bunkers and key ports. An excerpt of the report is as follows:

This is the first Integr8 Fuels Bunker Quality Trends Report covering the last six months of supplies globally, where we dissect and compare the likelihood of off specification issues across all commercial grades of bunkers and key ports. Using data from approximately 35,000 deliveries, we will also assess fuel quality trends using our own Integr8 Quality Index which scores the proximity (or otherwise) of individual parameters within each sample to the relevant Table 1 or Table 2 specification limits within ISO 8217. We will also consider the availability of fuels in general, what specifications are being guaranteed, and the potential for hidden losses which must never be ignored when purchasing given the current commercial backdrop.

How likely are we to be faced with an off specification situation?

The last 180 days owners’ analysis available to Integr8 Fuels has highlighted that you are most likely to have an off specification issue (Note 1) with High Sulphur Fuel Oil (HSFO) followed by Very Low Sulphur Fuel Oil (VLSFO) and then Marine Gas Oil (MGO). (Fig. 1)

Screenshot 2022 09 15 at 8.50.08 AM

What is the likelihood of receiving non-compliant or critically off-spec bunkers?

It is important, however, to consider the context of the off-specification incidents. To do this it is essential to consider the likelihood of Marpol (Sulphur) or SOLAS (Flash Point) compliance and the likelihood of Critical Off Specification Incidents such as Cat-Fines, Total Sediment, Used Lubricating Oil, Sodium and Ash Content (High Risk) against routine and easily rectifiable off specification issues classified “low risk” such as high viscosity in HSFO.

Purely on likelihood of an off specification occurrence we are more likely to have one with HSFO than VLSFO or MGO however at least double these are considered low risk.

Turning our attention to compliance Low and Very Low Sulphur Fuels, these fare far worse with us being approximately three times more likely to have a Sulphur or Flash Point off Spec incident with VLSFO and MGO, than HSFO, which are only found to be non-compliant in three deliveries per thousand.

Critical off specification issues such as Metals and Sediment are seen to be just as likely in HSFO as VLSFO but are very unlikely in Marine Gas Oils.

Finally, when we combine both compliance and high risk off specifications, the fuel with the highest incidence of off specification continues to be VLSFO at 1.7%, followed by HSFO at 1.2% and MGO at 1.0%. There are many nuances, from geographical to port-to-port and even supplier-to-supplier. It therefore remains essential to consider these when buying bunkers and we will address some of the challenges later in the paper.

Availabilty of Products

Unsurprisingly, Marine Gas Oil is the most available product (567 ports) given the ability to substitute and supply higher quality inland or automotive grades and the ease of logistics to supply what are quite often small quantities.

VLSFO is also seen to be readily available across all continents but at 17% fewer ports (463). This is because of larger quantities being ordered and the storage and barges needed to support these supplies in general.

High Sulphur Fuel Oil is the only product which is not readily available with only 187 ports listed, as of August 2022 (Fig. 2). HSFO availability is concentrated around bunkering hubs and geographically key areas likely to receive passing trade from Very Large Crude Carriers (VLCC) and / or other scrubber fitted sectors. It is important, therefore, to plan bunkering carefully for HSFO and equally consider the type of scrubber fitted to the vessel and any local limitations in forthcoming voyages that may require a fuel switch to Low Sulphur Marine Gas Oil (LSMGO) for example.

Availability of Grades

The fact that four ISO 8217 grades are still being requested remains one of the greatest challenges for the industry to address. Which other industry would even allow a fuel to be supplied using a specification that is obsolete, twice since revised, and 17 years old?

Indeed, during the period assessed for the report, 11.6% of all fuels supplied by Integr8 Fuels were still only guaranteed to 2005 specifications. Drilling into this further, it can be seen in the charts below that this is predominantly a distillate issue, with 16% of these fuels being still sold as 2005 (Fig 3) compared to only 2% of residual fuels. (Fig. 4)

Screenshot 2022 09 15 at 9.03.19 AM

Screenshot 2022 09 15 at 9.03.44 AM

It is positive news that at least for residual fuels we are seeing 2005 specifications becoming virtually obsolete probably because of two main drivers. Firstly, fewer customers are now requesting 2005 specifications given the added protection afforded for critical parameters like Catalyst Fines (Aluminium and Silicon ) and Sodium with 2010 (or later) specifications, and secondly, suppliers have in general moved away from 2005 specifications because of their position being more problematic when faced with the inevitable notice relating to Clause 5 or chemicals and added substances.

The same, however, cannot be said for distillate fuels with almost a fifth of fuels still being sold to this 17-year-old specification, the supply of which is particularly prevalent in the Indian subcontinent with pockets noted elsewhere, one such area being the eastern seaboard of the United States.

Screenshot 2022 09 15 at 9.05.11 AM

It is therefore important to consider what issues may arise because of only obtaining 2005 specification and where you may face this issue.

Firstly, 2005 specifications offer no guarantee for Lubricity, Oxidation Stability, Acid number or Hydrogen Sulphide and whilst it is rare that issues arise, the added cover for a fuel which may have aged afforded by the Oxidation stability parameter is an important one.

Of greater concern is the fact that a supplier is afforded more scope with regard minimum Viscosity guarantees which allows a minimum level of 1.5cSt rather than 2.0cSt for 2005 compared to 2010 specs and beyond. Such low levels can be particularly problematic to vessels which do not have the ability to cool the fuel given the need to inject the fuel at a minimum of 2cSt stipulated by most engine manufacturers and the possibility of fuel pump issues or even loss of propulsion as a result.

Cross referencing back to the eastern seaboard we note that around 25 percent of all samples testing below 2.0cSt in the last 180 days, this in a location where we may have no guarantee to protect us from this issue (Fig 5). Indeed in the port of Norfolk (Vi.) where only 2005 specifications are available, 65% of all samples have recently tested under 2cSt for Viscosity. Therefore, if bunkering in the USA and particularly the eastern seaboard it is highly recommended to purchase 2010 specification or higher.

Note: Manifold Times will be publishing part II of the Integr8 Bunker Quality Trends Report tomorrow.

Photo credit: Integr8 Fuels
Published: 15 September, 2022

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.

Published

3 days ago

September 22, 2023

Admin

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

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.

Published

3 days ago

September 22, 2023

Admin

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

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”.

Published

3 days ago

September 22, 2023

Admin

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