Business

Marine fuel consultants explain Singapore’s 10.8% on year bunker sales increase in April

April bunker sales results released on Wednesday caught several players, who expected volume to fall due to lower international trade and COVID-19, by surprise.

Published

5 years ago

May 14, 2020

Admin

April’s 10.8% on year rise of bunker sales at Singapore port was a surprise to many, who expected the month’s volume at the republic to fall due to lower international trades and the Coronavirus Disease 2019 (COVID-19) pandemic.

Singapore bunkering publication Manifold Times took to the occasion and approached local marine fuel consultancies Azure Strategic Resources and SDE International to shed light about the development.

Dennis Ho, Director & Founder of Azure Strategic Resources, explained Singapore’s total bunker volume in April 2019 was firstly at a low of 3.7 million mt – a low base when compared to the 4.1 million mt of bunker sales at Singapore in April 2020, which is largely in line with the average monthly volume of 4 million mt within the past two years.

“Quite a fair amount of supplies was fixed on a contract basis prior to the start of IMO 2020 implementation on 1 January. It is possible that these contracts are still being fulfilled,” he adds.

“The Singapore increase in volume may also come at the expense of other smaller ports where supply of 0.5% sulphur compliant fuel may not be reliable. In fact, other major ports like Rotterdam and Zhoushan have been reporting healthy demand.

“Traders and buyers which I talked to commented their April demand was largely unchanged and in fact saw a pick up towards end April. This is likely due to the steep correction in prices following the negative crude oil price seen on 19 April.

“The same traders and buyers commented May looking to be a slow month. A buyer expects he may only be able to fulfil the lower end of his buying commitment.”

Simon Neo, Executive Director at marine fuels consultancy SDE International, notes current market conditions have resulted in prices of bunker fuel at Singapore port being lower when compared to the similar period a year before.

The total number of vessel arrivals at Singapore port was 7,015 in April 2020 (37.6% lower on year) while container and cargo throughput both respectively fell 5% and 12.6% on year, according to Maritime and Port Authority of Singapore (MPA) data.

“The drop in the number of vessel arrivals, container and cargo throughput clearly shows trade volume to be down,” said Neo.

“However, the increase in bunker volume is more due to the fact that oil prices are very low now. This generates more buying interest as nobody knows when for sure, how long this low oil price will last.

“Instead of topping up 500 or 600 mt, ship owners may now be incentivised take up to 1,000 mt or 1,500 mt.

“The other factor of what Dennis said is quite true, as a lot of ship owners have entered into pre-signed contracts before IMO 2020 due to worries about the availability and quality of VLSFO around the region.

“Singapore is the premier bunkering port which is very well regulated, and supported by a highly respected bunkering standard backed by the use of mass flowmeters for the custody transfer of marine fuel.

“This encourages more ship owners to take up products in Singapore as there is accountability involved and they will all know who to approach if anything goes wrong.”

Singapore’s bunker fuel sales volume was release by MPA on Wednesday (13 May).

A total 4.11 million metric tonnes (mt) (exact: 4,113,700 mt) of bunkers was sold at the port in April, 10.8% more than 3.71 million mt (exact: 3,712,100 mt) posted during April 2019.

Deliveries of 500 centistokes (cSt), 380 cSt and 180 cSt grades in April 2020 (against on year), were respectively 78,400 mt (-88.7% from 691,900 mt), 692,800 mt (-73.5% from 2.61 million mt), while 180 cSt product recorded no sales (-100% from 24,000 mt).

Low sulphur 500 cSt, 380 cSt and 180 cSt products respectively recorded no sales (similarly compared to zero sales in 2019), 2.15 million mt (significantly up from 16,400 mt), and 111,100 mt (+194.7% from 37,700 mt).

The latest data introduced new categories, namely low sulphur 100 cSt, and ULSFO respectively recorded 597,800 mt and 66,700 mt of sales in April.

Low sulphur marine gas oil (LS MGO) sales were posted at 372,600 mt (+89.5% from 196,600 mt) and MGO at 48,400 mt (-31.9% from 71,100 mt).

Photo credit: Manifold Times
Published: 14 May, 2020

Business

Shell MGO bunker heist: Bunker clerk pleads guilty to helping Sentek acquire misappropriated fuel

Wong Wai Meng, who received more than USD 286,000 from Sentek Marine & Trading for his assistance, pleaded guilty to 12 counts of intentionally helping the firm acquire the misappropriated marine gas.

Published

7 hours ago

December 2, 2024

Admin

A bunker clerk, Wong Wai Meng, who received more than USD 286,000 (SGD 384,681) from Singapore-based Sentek Marine & Trading (Sentek) for his assistance, pleaded guilty to 12 counts of intentionally helping the company acquire misappropriated marine gas oil, The Straits Times reported on Friday (29 November).

The 58-year-old Singaporean was employed at the Sentek when he assisted in acquiring more than 28,000 metric tonnes (mt) of the misappropriated fuel worth USD 13.58 million (SGD 18.26 million).

Wong committed the offences over 46 occasions between August 2014 and December 2017.

Wong is among the three bunker clerks previously employed by Sentek, who were charged for offences under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA) and the Prevention of Corruption Act (PCA).

Another bunker clerk among the three charged, Wong Kuin Wah, 61, was sentenced to seven years and six months’ jail on 18 November for his role in misappropriating more than 27,000 tonnes of gas oil worth around USD 12.8 million (SGD 17.2 million).

The third individual who was charged, Boo Pu Wen, reportedly passed away in July 2023 and had his charges abated following his death, meaning Boo’s court proceedings over his 19 charges at the time came to an end.

Former Shell employees, who were key members of a group who dishonestly misappropriated fuel from Shell Pulau Bukom, were sentenced to jail in court earlier.

Earlier coverage of developments by Manifold Times regarding the Shell MGO bunker heist can be found below:

Photo credit: Katrin Bolovtsova
Published: 2 December, 2024

Biofuel

Singapore: GCMD introduces new technique for FAME bio bunker fuel fingerprinting

Fingerprinting identifies feedstock origins of FAME-based biofuels used in shipping industry; can be used as a potential tool to detect fraud in marine fuel supply chains and ensure biofuel authenticity.

Published

7 hours ago

December 2, 2024

Admin

Singapore: GCMD introduces new technique for FAME bio bunker fuel fingerprinting

The Global Centre for Maritime Decarbonisation (GCMD) on Monday (2 December) released its latest report, presenting a new technique that creates a fingerprint for Fatty Acid Methyl Esters(FAME) bio bunker fuels.

This fingerprint identifies the feedstock origins of the FAME-based biofuels used in the shipping industry.

GCMD said FAME fingerprinting is needed as the shipping sector is increasingly using biofuels, such as FAME, to reduce its GHG emissions. With that, concerns have arisen regarding the legitimacy of biofuels and whether they are truly sustainable.

Industry bodies are seeing a rising number of cases mislabelling biofuels purported to be made from recycled oils and fats, while suspicions persist that they might be produced from cheaper and less sustainable virgin oils.

“To address these concerns, FAME fingerprinting can be used as a potential tool to detect fraud in marine fuel supply chains and ensure biofuel authenticity. By providing a physical validation method that complements existing certification schemes, FAME fingerprinting can help justify the green premium with genuine environmental benefits and safeguard the integrity of marine fuels supply chain,” GCMD said.

FAME fingerprinting is based on the principle that the fatty acid profile of FAME is unique to its feedstock and can be preserved during feedstock transesterification to produce FAME. The "fingerprint" can then be compared against a database of known fatty acid profiles to identify the feedstock origin.

GCMD worked with VPS who modified existing fuel testing methods to carry out sample analyses using a gas chromatograph with flame-ionisation detection, an instrument commonly found in fuel test laboratories.

The analysis takes about an hour, comparable to the turnaround time for current marine fuel quality testing in the supply chain.

“We have tested this method on a variety of FAME samples from different suppliers, including virgin oils, used cooking oils, palm oil mill effluent, beef tallow and food waste and were able to identify the feedstock origins for each sample,” GCMD added.

Manifold Times previously reported Captain Rahul Choudhuri, President, Strategic Partnerships at marine fuels testing company VPS, forecasting the use of finger printing technology today will likely establish a blueprint of how future alternative bunker fuels’ feedstocks are authenticated.

Captain Choudhuri said this when he gave an update of VPS’ biofuels finger printing trials with GCMD.

Note: The full report, titled ‘Rapid forensic analysis of FAME-based biofuels: Potential use of its fingerprint as a fraud detection tool’, can be downloaded here.

Photo credit: Global Centre for Maritime Decarbonisation
Published: 2 December, 2024

Methanol

PLAGEN to produce and supply green methanol bunker fuel with Latvia plant

Korean firm’s MoU with AE Risinājumi will see construction of Latvia’s first commercial-scale green methanol production plant, which will supply green methanol to ships in EU’s maritime fleet.

Published

7 hours ago

December 2, 2024

Admin

PLAGEN to produce and supply green methanol bunker fuel with Latvia plant

South Korean clean energy firm PLAGEN on Friday (29 November) signed an MOU with Latvian company, AE Risinājumi, for the production of green methanol in Latvia at the “2024 Latvia-Korea Business Forum” hosted by the President of Latvia.

The agreement will result in the construction of Latvia's first commercial-scale green methanol production plant, which will supply green methanol to ships in the EU's maritime fleet, contributing to the reduction of greenhouse gas emissions from maritime transportation.

PLAGEN's MoU aims to produce 20,000 metric tonnes (mt) of green methanol per year and will begin feasibility studies in the first half of 2025, and full-scale production will begin in 2028.

With 53% of Latvia's land area covered by forests, timber production and wood processing make a significant contribution to Latvia’s economic production, which generates a large amount of forest residues and wood wastes. In addition, Latvia also has an abundance and low price of renewable electricity from wind power.

Latvia is one of the most competitive countries in the European Union, as it can produce clean methanol at a competitive price by using abundant wood waste as a raw material and renewable electricity from cheap wind power.

The use of abundant forest residues and wood wastes as a feedstock and cheap renewable electricity from wind power makes it possible to produce green methanol with a competitive price, making Latvia is one of the most competitive countries in the EU.

In the European Union, the European Emissions Trading Scheme (EU-ETS) will come into effect in 2025, requiring shipping companies to purchase carbon credits for their greenhouse gas emissions.

In addition, the EU is implementing FuelEU Maritime, which aims to reduce greenhouse gas emissions by 2% below the 2020 average by 2025 and 80% by 2050. This is expected to result in an energy transition to green methanol.

In July 2023, the International Maritime Organization (IMO) adopted a revised strategy that calls for reducing greenhouse gas (GHG) emissions from ships to net-zero by or around 2050, and plans to introduce full-scale regulations from 2027, and shipping companies have begun ordering methanol-powered ships fueled by green methanol, a carbon-neutral fuel.

“We expect to start producing green methanol in Latvia in 2028, which will reduce greenhouse gas emissions from EU maritime transport vessels and contribute significantly to the revitalization of the Latvian economy and national energy security,” said John Kyung, CEO of PLAGEN.

In November 2024, PLAGEN completed the purchase of an industrial complex and received a government permit for the construction of the country's first green methanol plant in Dongjeom Industrial Complex in Taebaek City, Gangwon-do.

The project, which will produce 10,000 mt per year, is scheduled to begin construction in the first half of 2025 and begin production in the second half of 2027.

Photo credit: PLAGEN
Published: 2 December, 2024