Connect with us

Business

KPI OceanConnect: Five Reflections On IMO 2020

‘The bunker price volatility this year […] is a textbook example of why it pays to consult with your marine fuels supplier to help manage this risk,’ says CEO Søren Høll.

Admin

Published

on

Soren Hall KPI Ocean Connect Reflections

Søren Høll, CEO at International bunker trading firm KPI OceanConnect, on Tuesday (18 August) published an article sharing his reflections on regulations and other unforeseen market dynamics in 2020 have disrupted the bunker fuel market, and outlines the relevance of his company’s role in weathering these forces: 

IMO 2020, or ‘MARPOL Annex VI, regulation 14’ as it was less memorably known back when we started preparing for it in 2018, was always going to bring huge changes for shipping.

For some people it was even going to be as substantial as ships’ switch from coal to oil in the early 20th century. Those predictions have fortunately proven to be unfounded so far, but there hasn’t been any shortage of challenges for our industry in the wake of IMO 2020’s arrival.

 During the last few weeks as we’ve been concluding our merger with OceanConnect and I’ve had a chance to reflect on how far we’ve come this year.

 -      It’s easy to forget that crude prices started to slide not only because of Covid-19 in February and March, but also due to disagreements within OPEC+ about how much oil they should produce. Covid-19 has reduced demand for oil, and created a huge glut of both crude and refined products. Even if a vaccine emerges soon, we’re unlikely to see this oversupply abate entirely; not least because countries like Venezuela, Libya, and Iran with huge crude reserves are currently ‘offline.’

-      At times in January it looked as though shipowners who’d invested in scrubbers for their fleets could see payback periods of less than two years in some cases. By March, however, the spread between 3.5% HSFO and 0.5% VLSFO dropped to as low as $40 a tonne from over $300, and payback periods are now commonly assumed to be at least four or five years. We’re unlikely to see sustained interest for retrofitting scrubbers as long as the spread remains low. On newbuilds, I’m slightly more optimistic about positive economics.

-      By common estimates, the three biggest cruise lines, Carnival, Norwegian, and RCCL together on average consumed about half a million tons of bunkers each month in 2019. For context, that’s more than 10% greater than total fuel sales of Panama registered by the AMP. Especially for physical suppliers in cruise hotspots like the Caribbean, which supports about a third of global cruise voyages, bunker demand is unlikely to return in full before 2022 at the earliest.

-      The bunker price volatility we’ve seen this year – and in many previous years – is a textbook example of why it pays to consult with your marine fuels supplier to help manage this risk. I was talking to a longstanding client last week, and for her there are three big advantages to be gained from  hedging and risk management: Reduced volatility reduces cost of capital; knowing there will be no abrupt cost increases means that they can more easily plan ahead; and by smoothing out revenue and expenses they know they won’t need to borrow on unfavourable terms because they’ve got good liquidity.

 The merging of KPI Bridge Oil and OceanConnect brings together a wealth of knowledge and expertise, new ideas and ways of thinking, and a renewed energy to a changing marketplace. There’s no shortage of challenges ahead for the shipping or bunkering markets, but I’m very optimistic about the company we’re building and the value we can provide. 


Photo credit: KPI OceanConnect
Published: 20 August, 2020

Continue Reading

Alternative Fuels

Argus Media: New ISO 8217 eyes wider scope for alternative bunker fuels

New edition will incorporate specification standards for a wide range of Fame-based marine biodiesel blends up to B100, 100pc HVO, as well as synthetic and renewable marine fuels.

Admin

Published

on

By

resized argusmedia

The 7th edition of ISO 8217, to be published in the second quarter of this year, will outline a broader integration of marine biodiesel blending, delegates heard at the International Bunker Conference (IBC) 2024 in Norway.

24 April 2024

Tim Wilson, principal specialist fuels of Lloyds Register's fuel oil bunkering analysis and advisory service (FOBAS), presented on the upcoming iteration of the ISO 8217 marine fuel specification standard, which will be released at IBC 2024. 

The new edition will incorporate specification standards for a wide range of fatty acid methyl ester (Fame)-based marine biodiesel blends up to B100, 100pc hydrotreated vegetable oil (HVO), as well as synthetic and renewable marine fuels. 

This will also include additional clauses to cover a wider scope, and briefly touch on biodiesel specifications that do not entirely align with road biodiesel EN-14214 specifications. This follows the emergence of widening price spreads for marine biodiesel blends because of specification differences and the lack of a marine-specific standard for the blends.

The new edition of ISO 8217 is also expected to remove the limit of 7pc Fame when blended with distillate marine fuels such as marine gasoil (MGO) which was in place in the previous ISO 8217:2017. 

Other changes to distillate marine biodiesel blends include changes to the minimum Cetane Index, oxidation stability alignment to be connected to either ISO 15751 for blends comprising 2pc or more of Fame biodiesel and ISO 12205 for blends comprising a Fame component of under 2pc. 

Cold-filter plugging point (CFPP) properties will be determined by the vessel's fuel storage tanks' heating capabilities and requirements will be set in place to report the CFPP for distillate marine biodiesel grades, according to the new edition of the marine fuel specification standard.

Wilson said that a minimum kinematic viscosity at 50°C will be in place for various forms of residual bunker fuel oil along with a viscosity control alerting suppliers to inform buyers of the exact viscosity in the supplied fuel. He said they have seen delivered fuel viscosity come in at much lower levels than ordered by the buyers, which was the reasoning behind the viscosity control monitoring requirement.

By Hussein Al-Khalisy

 

Photo credit and source: Argus Media
Published: 25 April 2024

Continue Reading

Business

Methanol Institute welcomes StormFisher as newest member

Company produces clean hydrogen, e-methane, e-methanol, and green ammonia, creating local energy security, and providing export opportunities to Asia Pacific and European markets.

Admin

Published

on

By

Methanol Institute welcomes StormFisher as newest member

The Methanol Institute (MI) on Monday (22 April) welcomed StormFisher Hydrogen Ltd. as its newest member. 

According to Mi, StormFisher Hydrogen Ltd. develops, owns, and operates electrolysis-based clean fuel production facilities in North America. 

“With its track record in developing and operating clean fuel facilities, StormFisher serves its customers with a sustainable and reliable fuel supply, to meet the needs of traditionally hard to decarbonize sectors,” it said. 

The company produces clean hydrogen, e-methane, e-methanol, and green ammonia, creating local energy security, and providing export opportunities to Asia Pacific and European markets.

MI CEO Greg Dolan, said: "With their expertise in developing and operating clean fuel facilities, StormFisher is a valuable addition to MI's membership. As the clean energy transition continues to gain pace, StormFisher's e-methanol production will be part of the net-carbon neutral future."

"Our company is excited to join the Methanol Institute and collaborate on developing the eMethanol market and shaping supportive policies globally," said StormFisher CEO Jud Whiteside. "Working together, we can drive methanol's potential as a key solution for decarbonization and sustainability."

Related: Methanol Institute: Progress as a marine fuel continues across supply chain (Week 15, 8-14 April 2024)
Related: Methanol Institute and SEA-LNG unite against EU trade barriers to biomethane and biomethanol fuels\

 

Photo credit: Methanol Institute
Published: 25 April 2024

Continue Reading

Alternative Fuels

SMW 2024: All hands on deck to overcome net-zero fuel transition challenges, says panellists

Ammonia is touted as the long-term fuel solution, but safety concerns and novel technology could hinder its widespread application.

Admin

Published

on

By

SMW 2024: All hands on deck to overcome net-zero fuel transition challenges, says panellists

The article ‘All hands on deck to overcome net-zero fuel transition challenges: panellists’ was first published on Issue 4 of the Singapore Maritime Week 2024 Show Dallies; it has been reproduced in its entirety on Singapore bunkering publication Manifold Times with permission from The Nutgraf and the Maritime and Port Authority of Singapore:

By Matthew Gan

Ammonia is emerging as the key net-zero fuel of the future, but the maritime industry faces several challenges in its large-scale adoption.

A critical concern is safety. Ammonia poses safety  risks because of the high volume of explosive engine combustions, and the gas’ toxicity.

“Safety is the most crucial thing – both environmental and operator safety,” said Mr Hiroki Kobayashi, Chief Executive Officer at heavy industries firm IHI Asia Pacific, at the Net-Zero Fuel Pathways Panel during the Accelerating Digitalisation and Decarbonisation Conference on Wednesday.

Given the focus on safety, a substantial proportion of resources should be spent on ensuring ammonia technology is safe, added Mr Nicolas Brabeck, Managing Director at energy provider MAN Energy Solutions Singapore.

What will help, noted Mr Kenneth Widell, Senior Project Manager (Smart Technology Hub) at marine and energy solutions provider Wartsila, is having stakeholders share information on safe ammonia usage.

Another challenge is training seafarers to use novel technology. But panellists agreed that it should not deter the industry from pursuing the widespread adoption of ammonia.

“All this is new to us, but we can start training early, collect feedback, and adjust accordingly,” said Mr Leonardo Sonzio, Vice-President and Head of Fleet Management and Technology at global shipping company Maersk.

Stakeholders should also collaborate more, said Mr Robert van Nielen, Vice-President (Growth) at liquid storage logistics provider Advario. “There are many things to set up – supply chains, logistics, safety protocols and training – but we need to transition. And if we want to make this change in time, we must work together,” he said.

As moderator Mr Knut Orbeck-Nilssen, Chief Executive Officer (Maritime) at registrar and classification society DNV, put it in his closing remarks: “The fuel of the future, really, is collaboration.”

Singapore Maritime Week 2024 was organised by Maritime and Port Authority of Singapore from 15 to 19 April. 

 

Photo credit: Knut Orbeck-Nilssen / DNV
Article credit: The Nutgraf/ Maritime and Port Authority of Singapore
Published: 24 April 2024

Continue Reading
Advertisement
  • SBF2
  • Consort advertisement v2
  • RE 05 Lighthouse GIF
  • Aderco advert 400x330 1
  • v4Helmsman Gif Banner 01
  • EMF banner 400x330 slogan

OUR INDUSTRY PARTNERS

  • Triton Bunkering advertisement v2
  • HL 2022 adv v1
  • Singfar advertisement final
  • 102Meth Logo GIF copy


  • Auramarine 01
  • CNC Logo Rev Manifold Times
  • E Marine logo
  • Victory Logo
  • Uni Fuels logo advertisement white background
  • endress
  • intrasea
  • pro liquid
  • Kenoil
  • Trillion Energy
  • Headway Manifold
  • Advert Shipping Manifold resized1
  • 400x330 v2 copy
  • VPS 2021 advertisement

Trending