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TFG Marine: All hands on deck for greater transparency in the bunkering industry

There is a continuing lack of transparency in the way marine fuel is delivered and this has to change, said Kenneth Dam, TFG Marine Global Head of Bunkering.

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The following is an article written by Kenneth Dam, TFG Marine Global Head of Bunkering, on Thursday (4 August) putting forward the case for the widespread adoption of mass flow metering technology to increase efficiencies and to help stamp out malpractice in the marine fuel supply industry:

The bunkering industry provides over 200 million metric tonnes of marine fuel annually along main shipping thoroughfares, at ports and offshore, to the tens of thousands of commercial vessels that sail the world’s seas. This is a market that was worth USD110 billion globally in 2020 and is projected to reach USD165 billion by 2030.

Yet, despite its scale and the essential role it plays in supporting global maritime trade, much of the industry is still steeped in old-fashioned, outmoded operational practices. There is a continuing lack of transparency in the way marine fuel is delivered. This has to change. It is commercially and reputationally damaging. It is holding back our industry and undermining its prospects for growth.

TFG Marine entered the bunkering market in 2020 with a clear mission: to provide a premium bunkering fuel service, by deploying new technologies that increase efficiency and by ensuring transparency for our customers. We are a joint venture, owned by one of the world’s largest energy providers and two of its biggest shipping operators. That gives us industry knowledge and – as customers ourselves - an innate understanding of the challenges our customers frequently face.

A lack of transparency distorts markets

There is an inherent ambiguity in the way bunker fuel has traditionally been delivered. Marine fuels are supplied around the globe at different densities and in diverse atmospheric and climatic conditions. These variables have a significant impact on the quality and quantity of the bunker fuel supplied. Traditional delivery systems, which only monitor volume flow, cannot capture these differentials with any precision. Suppliers and customers therefore rely on manual measurement and adjustment formulae to agree the specifications for every transaction.

The complexity and opacity of this process makes it difficult to track and report transactions with confidence and accuracy. It also leaves customers vulnerable to fraud and corruption. Some operators have taken advantage of this complexity to game the system. There is a long and shameful history of dubious practices by bunker fuel suppliers that have short-changed ship owners on volumes.

Supplier malpractice takes many forms. It can include delivering fuel with high water, slops or air content, providing incorrect fuel temperatures or tampering with gauging, delivery equipment or paperwork to skew delivery data.

So why do so many operators continue to accept the status quo, when unacceptable practices are rife? The unfortunate reality is that time-consuming and costly counterparty disputes are seen as inevitable - a cost of doing business. And with the important exception of Singapore, there has been scant interest from regulators up to now in resolving the issues. The prevailing view seems to be that inaccuracies even out over time.

Superficially that may sound reasonable, but it is not borne out in practice. A recent Blue Insight study assessed bunker deliveries at Rotterdam and Fujairah, the world’s second and third largest bunkering ports. It concluded that reported VLSFO bunker volumes at these two locations resulted in USD250 million in operating losses for suppliers across 2021. The report went on to argue that, since suppliers would not voluntarily incur these losses over such a sustained period, the only plausible explanation was that volumes were being over-reported. In other words, intentionally or not, bunker buyers were being short-changed on volumes.

In the end, it is hard to avoid the conclusion that, whatever the reason, the opacity of bunker operations distorts markets and disadvantages customers.

MFMs and digital data

Frustratingly for those who wish to operate in a transparent market, there is a proven technology that can eliminate the transactional inaccuracies, but it has not been widely adopted. Mass flow meters (MFMs) make use of the Coriolis effect to allow the flow of fluids and gases to be measured with a high degree of precision. When fitted to ships, MFMs produce computerised records of exact volumes delivered in real time. Both counterparties have access to the same data. When it comes to transactions, what you see is what you get. Supply shortfalls no longer happen.

Another big advantage is that the more detailed transaction data afforded by MFMs allows ship owners to analyse, monitor and improve their impacts. This is vital. The maritime industry has challenging decarbonisation targets. Shippers need accurate fuel consumption data to calculate their GHG emissions. Without this, it becomes very hard to assess the effectiveness of decarbonisation initiatives.

TFG Marine is committed to implementing mass flow meters to offer our customers transparency and certainty. Over a third of our fleet already has MFM technology; more of our barges will be MFM-equipped over the next two years. That compares with an industry-wide average for MFM adoption of less than one percent.

While other industries have embraced digitalisation, the shipping industry has fallen well behind. MFMs have been used in a wide range of industries for many decades. While it is true that, until relatively recently, most ships’ systems could not easily incorporate MFM equipment, that is no longer the case. The industry is running out of excuses to avoid modernising and bringing into force rigorous standards of reporting and accountability.

It's time to make MFMs mandatory

As one of the world’s largest marine fuel suppliers, we are engaging with customers, peers, governments and authorities to address the industry-wide challenges that have plagued the marine fuel sector for far too long. Together with a growing number of major industry participants, we are now calling for the widespread adoption of mass flow metering.

We have joined with 50 other major industry participants representing 2,000 vessels to appeal to the Rotterdam and the Antwerp port authorities to follow Singapore’s lead and introduce mandatory MFM delivery in their jurisdictions.

The experience of the Maritime Port Authority of Singapore, which regulates the world’s largest bunker market, has already shown what can be achieved. In 2017, after painstaking work to introduce common standards, it mandated the use of mass flow meters (MFMs) for all bunker fuel deliveries within its jurisdiction.

Mandating MFM usage was transformative for Singapore. With analogue and manual processes increasingly consigned to the past, it is now viewed as the world’s most trustworthy bunker location. Singapore will continue to benefit from being a frontrunner in bunkering technology. It’s time for the rest of the world to follow suit.

A sustainable future for worldwide shipping requires action now. We need mass flow meters across the bunkering industry. We call on our peers, our partners and industry regulators to join with us and help make that happen.

 

Photo credit: TFG Marine
Published: 5 August, 2022

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Decarbonisation

SMW 2024: Maritime industry on track to adopt mid-term decarbonisation measures, says IMO chief

Safety, inclusion and transparency will be key areas for Mr Arsenio Dominguez’s tenure as Secretary-General of the International Maritime Organization.

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SMW 2024: Maritime industry on track to adopt mid-term decarbonisation measures, says IMO chief

The article ‘Maritime industry on track to adopt mid-term decarbonisation measures: IMO chief’ was first published on Issue 1 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:

Toh Wen Li
[email protected]

The maritime industry is “on track” to roll out decarbonisation measures by 2025 as set out by the International Maritime Organization, said its new chief Arsenio Dominguez.

“We are on track to adopt mid-term measures by late 2025 to cut greenhouse gas (GHG) emissions, to reach net zero targets,” said Mr Dominguez, who took over as IMO Secretary-General in January.

In 2023, the IMO released a revised GHG strategy to reach net-zero emissions from shipping by or around 2050 – far more ambitious than its 2018 initial GHG strategy, which aimed only to cut emissions by at least 50 per cent compared to 2008.

“These will help us progress towards achieving netzero GHG emissions by or around 2050, with indicative checkpoints to reach by 2030 (cut GHG emissions by at least 20 per cent, striving for 30 per cent), and 2040 (cut GHG emissions by at least 70 per cent, striving for 80 per cent).”

Mr Dominguez, who will be speaking on the opening day of the 18th edition of SMW, also emphasised the need to keep seafarers safe against the backdrop of heightened geopolitical tensions. He said the attacks on ships in the Red Sea have far-reaching economic implications.

“Prolonged disruptions in container shipping could lead to delayed deliveries, high costs, and inflation. Energy security and food security could potentially be affected due to increased prices,” he said.

“These attacks pose serious threats to global maritime security, as well as the security and maritime trade for the coastal states in the region,” he said, calling out the Red Sea attacks as “categorically unacceptable”. But he remains confident that the industry will continue to stay resilient. “I trust that shipping organisations and Member States alike will come together in the relevant IMO fora to seek collaboration and look for solutions together.”

Mr Dominguez also pledged to create a more inclusive IMO, one that is more gender-balanced in an industry that has long been dominated by men.

“I have appointed a gender balanced senior management team and initiated a policy of refraining from participating in panels or events unless gender representation is respected. I encourage the maritime community to follow this example,” he said.

He added that the IMO will also strive to fulfil its mandate as the world’s regulator for international shipping; support IMO’s 176 Member States, particularly Small Island Developing States and Least Developed Countries; raise public awareness of IMO’s impact; and adopt a “people-centred approach”.

“My vision is for IMO to flourish as a transparent, inclusive, and diverse institution,” he said. 

Singapore can ‘shine a light on the way forward’

Key maritime hubs like Singapore can play a key role as the industry pushes ahead in its quest to decarbonise, said International Maritime Organization’s (IMO) Secretary-General, Mr Arsenio Dominguez.

“Singapore is (in) a great position to participate in trials and pilots to show what works, including routebased actions – and share results of any trials back to IMO,” he said.

The green transition poses a slew of fresh considerations for the maritime sector. A major bunkering hub such as Singapore will need to look at making changes to infrastructure to deliver new fuels.

Other considerations for the industry include safety, pricing, lifecycle emissions, supply chain constraints, barriers to adoption and more, added Mr Dominguez. Seafarers, too, will need to be trained in how to operate new technology safely.

“We need ‘early movers’ in the industry as well as forward-looking policy makers to take the necessary risks and secure the right investments that will stimulate long-term solutions for the sector,” he said.

Singapore Maritime Week is a chance for key stakeholders to “have the conversations and discussions that can formulate ideas and bring new solutions”, Mr Dominguez said.

Now, more than ever, collaboration will be crucial. “The experience of critical maritime hubs like Singapore can help shine a light on the way forward for many issues. Here the IMO can play a role in providing opportunities for Singapore and other maritime hubs to share their expertise with all Member States. Shipping is global – no single country can go it alone.” 

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

 

Photo credit: International Maritime Organization
Article credit: The Nutgraf/ Maritime and Port Authority of Singapore
Published: 23 April, 2024

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Winding up

Singapore: Liquidator issues notice of dividend for Paliy Marine Engineering

Liquidator of Paliy Marine Engineering, which is undergoing voluntary liquidation, issued a notice on the first and final dividend.

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calculator steve pb from Pixabay

A notice of dividend for Paliy Marine Engineering Pte Ltd, which is undergoing voluntary liquidation, was published on the Government Gazette on Friday (19 April).

The following is the details of the notice:

Name of Company : Paliy Marine Engineering Pte. Ltd. (In Creditors’ Voluntary Liquidation) 

Unique Entity No. / Registration No. : 199608223D 

Address of Former Registered Office : 149 Rochor Road #03-28 Singapore 188426 

Amount per centum : 100 per centum of all admitted preferential claims 12.21 per centum of all admitted ordinary claims 

First and Final or otherwise : First and Final 

Name of Liquidator : Abuthahir Abdul Gafoor 

Address of Liquidator : c/o AAG Corporate Advisory Pte. Ltd. 144 Robinson Road #14-02 Robinson Square Singapore 068908

According to SGP Business website, the firm’s principal activity is building and repairing of ships, tankers and other ocean-going vessels. 

Related: Singapore: Paliy Marine Engineering liquidator issues intended dividend notice

 

Photo credit: steve pb from Pixabay
Published: 23 April 2024

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MoU

IBIA and BIMCO to collaborate on bunker fuel and maritime challenges

Both will collaborate in areas including research initiatives, studies, and projects relevant to bunker or marine energy industry and maritime sector as well as training and education.

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IBIA and BIMCO to collaborate on bunker fuel and maritime challenges

The International Bunker Industry Association (IBIA) and BIMCO on Monday (22 April) said they have signed a Memorandum of Understanding (MoU) to collaborate on some of the monumental challenges and opportunities within the areas of bunker, marine energy and maritime sectors and help facilitate shipping’s decarbonisation efforts.

The parties have agreed to leverage their respective expertise and resources to develop innovative solutions and initiatives to facilitate the transition towards cleaner fuels and efficient and sustainable shipping practices. The partnership MOU will focus on addressing the following key areas:

Research and Development: Collaborate on research initiatives, studies, and projects relevant to the bunker/marine energy industry and maritime sector.

Information Sharing: Share relevant information, publications, and data that may be beneficial to the members of both organisations.

Training and Education: Explore opportunities for joint training programs, seminars, and educational initiatives to enhance the knowledge and skills of professionals in the maritime and bunker/marine energy industry.

Influence: Work together on efforts to address common issues and challenges faced by the industry.

Alexander Prokopakis, Executive Director of IBIA, said: “This partnership between IBIA and BIMCO marks an important step towards addressing the pressing challenge of decarbonisation in the shipping industry. The collaboration underscores the industry’s collective commitment to navigating towards a greener future for maritime operations.”

David Loosley, BIMCO Secretary General & CEO, said: “As we work towards the checkpoints and targets of the updated GHG strategy of the IMO, working across all sectors that influence and support decarbonisation of shipping will be key. Our ships will be relying on many different fuel solutions in the process and working toward the safety and availability of those is crucial.” 

IBIA and BIMCO are committed to driving progress towards a more sustainable and environmentally responsible future for the global shipping industry.

 

Photo credit: IBIA and BIMCO
Published: 23 April 2024

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