INDEPENDENT INTELLIGENCE FOR THE GLOBAL BUNKER INDUSTRY
www.bunkerspot.com Volume 7 Number 1 February / March 2010
Inside: • Mergers and Acquisitions • Spotting Opportunities CHANGING TACK: • Bunker Books The race to • Pricing Strategies • People and Places zero emissions • News and Events Contents
NEWS Bunker Overview 4 Europe 8
Head Office: Asia Pacific 14 Petrospot Limited Americas 18 Petrospot House Somerville Court Africa and Mideast 22 Trinity Way Adderbury Oxfordshire OX17 3SN COMMERCIAL ISSUES England Tel: +44 1295 81 44 55 Lesley Bankes-Hughes looks at recent deals in the bunker sector – and asks what is Fax: +44 1295 81 44 66 driving M&A activity in these straitened times 24 Email: [email protected] Website: www.cargosecurityinternational.com For the international bunker market, writes Adrian Tolson of Chemoil, 2010 means Director - Publishing / Editor fewer contracted and more spot transactions, reduced credit lines, more insurance and Ian Taylor an increasingly fragmented customer base. Welcome to the new world order 28 Tel: +44 1295 81 44 55 Mob: +44 7876 70 45 41 Email: [email protected] BUNKERSPOT WORLD MAP Managing Director / Publisher Global prices and news at a glance 30 Llewellyn Bankes-Hughes Tel: +44 1295 81 44 55 Mob: +44 7768 57 44 30 RISK MANAGEMENT Email: [email protected] Henrik Zederkof of Dan-Bunkering expects to see a growing interest in bunker risk Associate Editor management 32 Lesley Bankes-Hughes Tel: +44 1295 81 44 55 Chris Thorpe of HCEnergy gives an update on price protection strategies 34 Mob: +44 7815 57 86 43 Email: [email protected] ENVIRONMENTAL ISSUES Advertising Sales Executive Steve Simpson Bill Hemmings of T&E considers how the recent Copenhagen Climate Conference Tel: +44 1295 81 44 55 will affect the bunker industry 36 Mob: +44 7800 75 52 78 Email: [email protected] Susann Dutt, Environmental Controller at the Port of Gothenburg, reveals the results Director - Events of a survey on the adoption of cold ironing undertaken as part of the World Ports Luci Llewellyn-Jones Climate Initiative 40 Tel: +44 1295 81 44 55 Mobile: +44 7775 92 42 24 Diane Gilpin of B9 Shipping outlines the company’s plans to develop a cargo vessel Email: [email protected] which uses carbon-neutral propulsion technologies 42 Events Executive Why is the shipping industry hanging on the outcome of COP15 and developments Sinead Harvey Tel: +44 1295 81 44 55 at the IMO when it already knows what it can do to address climate change, asks Email: [email protected] environmental charity Greenwave 44 Design & Marketing Manager Alison Jane Cutler TECHNICAL ISSUES Tel: +44 1295 81 44 55 Email: [email protected] Jon Watson of Razaghi Meyer International argues that bunker suppliers should look Design & Marketing Executive at the benefits of inline sensors 48 Simon Demaine Andrew McEwen of Guardian Marine Testing comments on the continuing debate Tel: +44 1295 81 44 55 Email: [email protected] about the proposed changes to ISO 8217 50 Sales Manager Luke Hallam Evans SPOTLIGHT ON HAITI RELIEF EFFORT Tel: +44 1295 81 44 55 Mob: +44 7815 86 73 52 Multi Service reports on the work going on behind the scenes to fuel the ships Email: [email protected] bringing aid to Haiti 52 Events Sales Executive Osei Mitchell EDUCATION AND TRAINING Tel: +44 1295 81 44 55 Mob: +44 7789 20 20 10 Llewellyn Bankes-Hughes looks at some of the books now available to newcomers to Email: [email protected] the bunker industry 54 Events & Subscriptions Sales Executive Elena Melis EVENTS Tel: +44 1295 81 44 55 Mob: +44 7975 89 52 03 Events and training course diary 56 Email: [email protected] Asia Representative NETWORKING Sarah Morris Tel: +65 8168 6976 Bunker people on the move 58 Email: [email protected] Accounts Bunkerspot is an integrated news and intelligence service for the international bunker industry. The bi-monthly magazine and 24/7 electronic news Helen Wilkins service, www.bunkerspot.com, both provide highly-specific information on all aspects of the marine fuels industry. Bunkerspot Magazine (published Tel: +44 1295 81 44 55 in February, April, June, August, October and December) annual subscription rate, including unlimited access to the website www.bunkerspot.com, is Email: [email protected] UK£250/€280/US$400. ISSN 1741-6981. Copyright Petrospot Limited © 2010. All rights reserved. Published by Petrospot Limited, a dynamic independent publishing, training and events organisation, focused on providing information resources for the transportation, energy and maritime industries. Cover Photo: Courtesy of B9 Shipping Disclaimer: Bunkerspot is an editorially independent magazine and electronic news information service. The information contained in the magazine and website is presented in good faith. Opinions expressed are not necessarily those of Petrospot Limited, which does not guarantee the accuracy of the information contained in Bunkerspot. Nor does Petrospot accept responsibility for errors or omissions or their consequences.
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bunkerspot February / March 2010 www.bunkerspot.com 3 Bunker Overview
12 month rolling price charts
380 CST Fuel Oil
600 Houston 380
Singapore 380 500 Fujairah 380
400 Rotterdam 380 PRICE $/tonne
300
200 FMAMJJASONDJ
Marine Diesel Oil 800 Houston MDO
700 Singapore MDO
Fujairah MDO 600 Rotterdam MDO
500 PRICE $/tonne
400
300 FMAMJJASONDJ
A time for grand alliances and new beginnings?
Crude oil prices mounted a modest rally as global demand for crude oil fell by 1.4 million another four years before there will be a need this issue of Bunkerspot went to press, with barrels a day (b/d) in 2009 – but it has forecast to revise this policy. The timing could prove Brent futures trading at around $73 a barrel. that demand will rise again during 2010 by crucial. The Royal Bank of Scotland has Bunker prices were looking relatively firm, with about 800,000 b/d. As has been the case for speculated that a revival in Iraq’s production the delivered 380 centistoke (cst) fuel oil in some years now, the continuing expansion of capability could upset the balance of global Rotterdam pegged at around $435 a tonne. the Chinese economy will be a key factor. supply and drive Brent crude oil prices down to In the immediate term, market observers The International Energy Agency (IEA) below $60 a barrel. However, it will be several commented, prices were likely to be relatively has also been predicting an upswing, but with years before Iraqi output ramps up significantly stable. But there was no clear consensus on caveats: ‘There is a possibility that demand for – and if Iraq is back in the OPEC quota system the outlook for the rest of 2010 and beyond. oil will rise by about 1.4 million b/d in 2010, by then, its impact on global supply will be Participating at a London conference at if the recovery of the global economic growth more contained. the start of February, Abdalla Salem El-Badri, continues. Non-OPEC output may be able to So much for future speculation. For the Secretary General of the Organization of the cover this increase in demand, which means moment, the oil sector is looking relatively Petroleum Exporting Countries (OPEC), that OPEC’s production rate will be the crucial stable and there is a fair amount of market spoke with guarded optimism of a ‘demand factor in achieving balance in the markets.’ confidence. Business consultants Ernst & recovery’, while warning that there were still a ‘Non-OPEC output’ currently includes Young believe that this translates into a high number of ‘uncertainties’. Iraqi exports. Even though Iraq was one ‘positive outlook’ for mergers and acquisitions In its official outlook report, OPEC of the organisation’s founder members, its (M&A) and initial public offerings (IPOs) in the estimated that the world economy will grow by production has been excluded from OPEC oil and gas sector. According to Ernst & Young, 1.3% in 2010 and it anticipated that this could quota agreements since 1998 and the M&A activity in the oil and gas sector was help the oil industry. According to OPEC, Secretary General has said it will be at least much stronger in the second half of 2009 than
4 www.bunkerspot.com February / March 2010 bunkerspot Bunker Overview
it was in the first six months, with 485 deals Nov/Dec-09 Jan-10 concluded compared to 352, and it expected 380 IFO 30-04 07-11 14-18 21-25 28-01 04-08 11-15 18-22 25-29 the upward trend to continue in 2010. Rotterdam d 455 441 426 432 441 470 472 445 435 On page 24, Lesley Bankes-Hughes looks Gibraltar d 472 469 462 465 469 499 501 474 457 at the recent merger and acquisition activity Piraeus d 473 466 450 451 458 494 495 474 458 in the bunker industry and finds that, when all the gloss of ‘synergies’ and ‘global reach’ are Suez d 497 503 501 500 493 499 512 513 503 stripped away, the main driver for many deals Fujairah d 473 463 453 461 474 497 494 474 457 Durban w n/a n/a n/a n/a n/a n/a n/a n/a n/a in the marine fuels sector is a simple matter of ‘survival’. Tokyo d 513 503 492 501 519 540 534 513 512 When faced with uncertainty, businesses Busan d 488 497 496 506 521 539 520 493 473 generally find that there is ‘safety in numbers’. Hong Kong d 484 478 464 470 488 506 505 489 472 There is, of course, some truth in this; but Singapore d 475 463 456 461 478 502 496 477 459 even the biggest companies will topple if they Los Angeles w 474 480 475 488 472 496 485 466 451 fail to read the market correctly, and react Houston w 460 449 442 443 455 478 482 459 440 accordingly. New York w 477 468 452 453 460 482 495 470 451 The forthcoming ARACON 2010 Panama w 488 485 469 476 484 500 503 484 460 conference, which Bunker Events will be Santos d 464 444 434 455 469 480 471 456 439 organising in Rotterdam on 17-19 March, Buenos Aires d n/a n/a n/a n/a n/a n/a n/a n/a n/a aims to address this issue. The conference programme will include a host of technical, legal and operational sessions, but there will Nov/Dec-09 Jan-10 also be a special presentation on the current 180 IFO 30-04 07-11 14-18 21-25 28-01 04-08 11-15 18-22 25-29 economic outlook for the shipping and the Rotterdam d 474 460 445 447 462 484 489 464 449 bunker industries. Gibraltar d 488 484 476 486 487 515 517 491 473 Writing in the previous issue of Bunkerspot, Piraeus d 488 482 467 467 477 512 512 492 473 Paul Johnston of SeaDebt Management Suez d 510 512 503 503 502 535 526 523 519 noted that demand for debt collection services Fujairah d 484 476 465 475 486 508 506 484 471 has never been stronger (see Bunkerspot, Durban w 507 503 491 497 493 506 503 496 485 December/January, page 50). ‘In a global business such as shipping,’ noted Johnston, Tokyo d 518 509 497 506 522 545 539 521 518 Busan d 500 510 503 516 531 548 528 501 494 ‘securing payment for goods or services Hong Kong d 491 482 471 476 495 516 513 494 478 can often be difficult, especially when the Singapore d 484 474 466 468 483 510 504 485 467 debtor has little in the way of assets or can’t be pursued cost-effectively through normal Los Angeles w 490 495 490 498 482 515 502 483 492 litigation. In today’s economic environment, Houston w 473 461 451 454 466 490 495 476 451 when so many companies are struggling to New York w 502 488 470 474 480 499 515 491 469 stay in business, the problems associated with Panama w 511 505 501 503 514 523 530 515 490 non-payment of debt inevitably increase.’ Santos d 483 463 453 470 488 499 490 475 458 We appreciate that we are running the risk Buenos Aires d 488 491 482 493 505 498 515 502 486 of coming across as too self-promotional, but we would like to point out that Petrospot has Nov/Dec-09 Jan-10 an event which addresses this issue too: the MDO 30-04 07-11 14-18 21-25 28-01 04-08 11-15 18-22 25-29 Managing Credit Risk seminar, which will next be held in April in Singapore (see page 56). Rotterdam d 595 583 582 594 623 635 630 592 572 Gibraltar d 657 641 630 645 651 682 689 659 622 Piraeus d 651 632 610 625 636 683 676 647 620
Suez d 764 1006 950 950 950 950 909 875 910 Fujairah d 638 635 638 639 649 661 656 657 653 Durban w 631 627 621 625 635 661 658 643 629
Tokyo d 618 624 619 633 655 680 673 656 646 Busan d 639 637 631 651 660 679 677 646 644 Hong Kong d 661 647 650 641 677 694 691 677 654 GLANDER Singapore d 630 614 591 595 630 653 655 625 601
Los Angeles w 704 704 691 714 715 718 705 688 654 Bunkerspot prices are compiled from the Houston w 622 619 608 625 634 663 678 666 646 reports of the four brokers whose market New York w 668 663 651 659 675 697 705 675 666 reports have consistently proved the most Panama w 718 714 708 708 720 729 730 720 694 reliable and accurate: Cockett Marine Oil Santos d 669 661 645 662 697 738 728 691 668 Limited, LQM, Glander International Inc., Buenos Aires d 706 710 703 714 732 714 733 723 720 and KPI Bridge Oil. Bunkerspot welcomes market reports from other sources for inclusion on its website www.bunkerspot.com KEY: d – delivered • w – ex-wharf • n/a – not available • mdo – marine diesel oil
6 www.bunkerspot.com February / March 2010 bunkerspot Commercial Issues Purchasing power
hile the much vaunted ‘green posed by larger players in a diminishing Lesley Bankes-Hughes shoots’ of recovery are market. Furthermore, it is also important looks at recent deals in Wbeginning to emerge in some to step back and take a wider view when industrial sectors (and, with an irony of trying to spot the drivers influencing M&A the bunker sector – and almost breathtaking proportions, seem activity in the bunker sector. More often than to be positively thriving in some areas not, marine fuel companies are not isolated, asks what is driving of the banking world), other sectors are independent entities in today’s commercial still languishing in a state of unremitting world. They are part of larger organisations M&A activity in these economic gloom. which have interests in many different areas The pulse of the global shipping sector of maritime transportation and logistics, straitened times remains perceptible, but it is very weak. or, indeed, in other industrial and finance Shipping companies continue to suffer sectors. Some deals may be part of this larger swingeing losses and, for some, the ignominy process of vertical integration as companies of bankruptcy. A large percentage of the create more complex and interdependent global fleet has been mothballed (with some operational structures – sometimes in an operators deciding that scrapping is the only attempt to reduce their exposure in specific option) and credit lines are remaining very business areas which may be highly vulnerable tight. Adding to the general malaise is the in times of economic freefall. prospect of a wave of newbuilds flooding Currently, the problem of under- into an already saturated market over the capitalisation is a persistent issue in the next five years or so, and, just to exacerbate shipping sector as escalating operating costs shipping’s woes, there are many predictions erode working capital reserves, leaving little that oil prices are set to remain relatively high left over for corporate shopping sprees. Many for the foreseeable future. banks have emphatically closed their doors to In this volatile and fragile climate, bunker clients seeking loans for business expansion, companies continue to find themselves so tracking down funds for potential between the proverbial rock and a hard place. acquisitions can, in today’s paralysed financial Oil supply is still out of kilter with even the climate, be a rather thankless occupation. current much reduced levels of demand, One of the headline deals of late 2009 marine fuel prices are comparatively high, was Glencore’s offer to purchase the 51% and chasing payment from cash-strapped stake in Chemoil held by the family of its customers is a daily problem for suppliers. late founder, Robert Chandran. The reason In such straitened economic for the deal – the family’s wish to divest its circumstances, most sectors would batten interest in the company – makes it a one- down the hatches, pare down their off in terms of M&A in the sector, but the operational expenditure as far as possible, and bidding interest it generated says a lot about wait for the storm to subside. Against such a the appetite for deal-making in the marine backdrop, it would be a brave commentator fuels industry. who would predict that the mergers and The $233 million cash offer for the acquisitions (M&A) sector would remain holding would effectively value the whole buoyant. However, acquisitions, joint ventures company at around $449 million – and, at and alliances are being struck in the bunker the time of writing, it still remains to be sector – even in the doldrums of late 2009/ seen how successful Glencore will be in early 2010. The obvious questions are: how securing the balance of the shares in the – in financial terms – are these deals being business. However, the timing of the deal is struck, and what is the rationale or impetus quite interesting, coming after the posting behind them? of Chemoil’s third quarter (Q3) results in A look at recent purchases and link-ups September, revealing a net loss of $12.6 in the marine fuels sector would seem to million and a fall in revenue of some 40% indicate that geographical business expansion from the year before – precipitated, obviously, is still the driver in many cases, with the by the trading meltdown in the shipping acquisition of local suppliers, or alliances with sector. them, providing a ‘ready to go’ solution to Glencore’s offer was at a discount of the difficulty of building up a business profile around 21% to Chemoil’s closing share price in a new area. In addition, individual national at the time of the bid. So, perhaps this was a regulations often demand a partnership with good time to buy from Glencore’s point of an indigenous operator as a condition of view, but what does Chemoil bring to this market entry. vast global conglomerate with interests in a Companies may also be looking for deals plethora of commodities and raw materials? to increase their existing market share and Perhaps a look at the other rumoured fleet size, or more cynically, they could be contenders for the Chemoil prize brings bolstering their operations against the ‘threat’ us closer to an answer. Vitol and Morgan
24 www.bunkerspot.com February / March 2010 bunkerspot Commercial Issues
Stanley are believed to have been in the just recently announced that it is to become Blood on the carpet bidding race, both organisations with a ConocoPhillips marine agent to extend Companies that are locked in to newbuild extensive interests in oil trading and other its outreach – a business model that the contracts are in an unenviable situation, with commodities, and what Chemoil could have company says it intends to replicate so as to a ‘collapse in loan to asset values’, says Mike brought them, apart from its overall marine further extend its UK business. Vernell, of Watson, Farley and Williams. fuel business, was in a sense, prime real estate Over the past two decades it would be fair He is more optimistic about the state of the in key ports. Sometimes, the niche player has to say that World Fuel Services did much shipping sector in the first weeks of 2010 than unrivalled access to business opportunities to set the pace in M&A with its acquisition in the weeks running up to the end of the that that even the corporate Goliath can only of Trans-Tec Services, Bunkerfuels, year, but, he says, ‘overall, sentiment is very achieve through the acquisition of a third Marine Energy (Arabia), Norse Bunkers subdued’ and, as far as the newbuild sector is party ‘minnow’. A/S, Oil Shipping, Tramp Oil, and, in concerned, ‘There is blood on the carpet – if Chemoil’s presence in the United States, 2008, Henty Oil. Similarly, no review of you don’t have funds in place to finance a Fujairah, Mundra in India, and at the Helios current M&A activity in the bunker sector new order, you can kiss it goodbye’. Terminal on Jurong Island in Singapore are would be complete without a reference to How many bunker companies will find valuable prizes, particularly given the price Aegean Marine Petroleum Network Inc. this a problem will probably begin to emerge tag of $233 million for the shareholding. (AMPNI). One industry analyst commented in 2010. Newbuild programmes will be subject There seems to be a voracious appetite at the to Bunkerspot about its seemingly ‘effortless to delays as companies try to shunt delivery moment for terminal acquisitions, notably growth when everyone else is suffering’. dates from 2011/2012 to 2014/2015. Earlier from financial/trading institutions. Not only Many column inches have been devoted to predictions of major order cancellations look does terminal storage give the purchaser its ambitious newbuild purchase programme, to have been a little off the mark. An analyst a valuable physical asset, but it also brings but corporate acquisitions have also figured at Drewry Shipping noted that while there with it the strategically important control of strongly in its recent strategy for growth. In would continue to be some cancellations, ‘it downstream supply – particularly within a 2007, it purchased (from cash flow) Bunkers will not be the headline figure – not the 50% crowded competitive market in a major port at Sea which gave it access to north west which has been spoken about’. such as Singapore. Europe, as well as control of a marine terminal. Furthermore, while some of the shipyards For Glencore, the deal also catapults it This was followed in 2008 by a foray into the who embraced the newbuild business so up the list of bunker suppliers in Singapore. Canadian market with the purchase of ICS wholeheartedly are now struggling for In 2008, Glencore was ranked as 22nd and Petroleum, a Vancouver and Montreal-based financial survival, analysts say that it is mainly Chemoil, 19th. However, newly released marketing and physical supplier. the second and third tier yards which are statistics from the Maritime and Port The $185.2 million raised through an really feeling the pressure. Mike Vernell also Authority of Singapore (MPA) show that initial public offering (IPO) in 2006 has, of points out that the Chinese shipyards are Chemoil had climbed to ninth position in course, supported the company’s ambitions better protected that those in Korea and Japan, 2009, thus giving Glencore an enviable new for growth, and it would seem that, even ‘because they demanded bank guarantees on profile as a supplier in this region. in these harsh economic times, financial instalment payments – this is a commitment Building critical mass and extending institutions are amenable to releasing funds that the banks won’t walk away from’. geographical coverage continues to drive the to Aegean – at the time of writing, the pace of deal-making in the marine fuel sector, company had some $420 million in working Locked into newbuild contracts witness Bominflot’s recent takeover of SBI. capital credit facilities. Those bunker companies locked into such This gives the German supplier a valuable The proposed purchase of the ARA newbuild contracts, may have little appetite position in the Amsterdam-Rotterdam- player, Verbeke Bunkering, significantly lifts for acquisitions, but they may be more Antwerp (ARA) region, and also extends Aegean’s market share and will substantially receptive to bid approaches than maybe five its overall European operations which, prior increase its bunker fuel sales volumes. years ago. Similarly, even those companies to the deal, centred on Germany, Estonia, Interestingly, Aegean has chosen to go to with an enviable geographical reach may Greece, Spain and Gibraltar. the capital market to raise money for what well be suffering from client defaults on Similarly, the Wrist Group’s recent it calls ‘certain corporate acquisitions and for supply payments. Realistically, this is what acquisition history indicates a strengthening general corporate purposes’. it has come down to: if a well-established of core businesses while pushing into new The cost of Verbeke has not been bunker company is not getting paid for its markets to achieve greater vertical integration disclosed but most analysts put it at around fuel, it will very quickly have to face up to and pursue the ‘holy grail’ of globalisation. One $50 million, and many believe that this may its vulnerabilities. It may well look either to of the group’s subsidiaries, OW Bunker, has, be just the start of a fairly assiduous corporate buy (if it has the funds) a less cash-troubled since 2008, opened a trading office in Geneva shopping spree. company to bolster its position or seek a in support of its ARA presence, has ventured So how will M&A activity pan out for saviour in a competitor who is willing to into Australia, and has also opened a North the bunker industry in 2010, given that few buy. Atlantic bunker supply station in Fuglefjord, will be able to fund purchases from cash The chances are that the ambition of the Faroe Islands – all independently initiated flows which already are under pressure to global expansion for bunker players will be strategies for growth rather than expansion maintain a company’s day-to-day survival put on hold in 2010/2011 – companies are by corporate accretion. However, the group and which are functioning as a front line more focussed on implementing survival has also grown its ship supply operations over defence against payment defaults. There is strategies. As an analyst at Poten & Partners recent years, and evidence of this strategy little likelihood that banks are going to relax told Bunkerspot: ‘Companies are getting surfaced most recently with the purchase of their position on lending to the shipping together to survive – the bigger the better One Source America. This, the largest deal sector in the foreseeable future, and those right now.’ Whatever happens in M&A in the in the group’s corporate history, will give the bunker companies who are not listed on bunker sector in 2010, and whatever gloss business major access to the United States and global stock exchanges (i.e. the majority) will, companies choose to put on it, the reality is Canada. In reality, it is often only by taking of course, not be able to go to the market to that survival will be the root cause of many the acquisition route that entry into such raise funds. deals that will be struck. Come 2011, it’s a large (and sometimes protectionist) markets For those that are listed, perhaps raising reasonable assumption to make that there can be successfully achieved. money through share issues will solve the will be fewer bunker players in the market Of course, not all deals have to be cross- liquidity problem, at least for smaller scale and life for the independents is going to be border (although the nature of the bunker acquisitions, as in the case of Verbeke. One particularly hard. industry often dictates that alliances will industry observer told Bunkerspot that while Bunkerspot’s prediction is that marine be trans-national). Gaining critical mass in ‘funding is very difficult to get hold of for fuel companies will increasingly find that a national market through a step-by-step any project’, there are signs that raising life will be going forwards as part of a approach is sometimes a way forward for money through equity issues might be a way much larger corporation which has multiple corporate expansion. In the UK, for example, forward, and that an increased demand for business interests – the business culture of the OceanConnect moved beyond London to this funding option has recently been seen in smaller bunker supplier may well be set for a establish an office in Hull in 2007, and has the United States and Norway. radical change.
26 www.bunkerspot.com February / March 2010 bunkerspot Commercial Issues Spotting a new op
For the international s the ripple effect of the worldwide recession continues to ‘The rule goes, as bunker bunker market, writes Aimpact many business sectors, the suppliers look to sell into a bunker fuel market is no exception. The Adrian Tolson of boom and eventual bust of the world broader base of customers economy over the past decade has not – and limit their counter Chemoil, 2010 means been more keenly felt than within the shipping industry. It finds itself in the party risk by limiting fewer contracted and unenviable position of being indebted credit lines to the bigger to banks to the tune of billions of more spot transactions, dollars yet reliant upon them and other customers – so the supplier reduced credit lines, financial institutions for credit in order is forced to concede crucial to buy bunker fuel. more insurance and an This trend has coincided with an margins in order to secure unexpected scarcity in fuel oil. The global the business’ increasingly fragmented recession and associated fall in oil products demand in the last two years led to excess customer base. Welcome refining capacity. Capacity with large residual as suppliers face greater risks of their production was the first to be closed and this customers defaulting, while existing cover is to the new world order created an even tighter market for fuel oil, constantly being reduced. And, despite recent narrowing the value of fuel oil (and bunker improvements in freight rates the possibility fuel) against crude. Many analysts predict this of shipping companies facing bankruptcy trend to continue for the next four to five remains omnipresent, leaving suppliers likely years. to face heavy insurance premiums for many Clearly, the supply of bunker fuel has years as a result. fallen during the last two years, and while As credit tightens, the terms of that demand for bunkers has also fallen, the fall credit are becoming more stringent. Bunker in supply has outstripped the fall in demand. companies have begun to cap credit lines, This situation has created a disconnect in opening the door to willing traders to become the normal market relationships and values a third party to support transactions. While of residual fuel and bunkers, so squeezing the length of credit lines has been reduced, suppliers’ bunker margins, and in particular this hasn’t prevented some bunker suppliers contract margins. Suppliers have also hurt and traders seeking shorter terms on bunker their own margins. The rule goes, as bunker transactions within the typical 30 days. suppliers look to sell into a broader base of While not yet a paradigm shift, trends have customers – and limit their counter party started to emerge to reveal that shipowners risk by limiting credit lines to the bigger and operators are not exclusively focused on customers – so the supplier is forced to price in the new economic world. Purchasers concede crucial margins in order to secure are also looking for longer term deals and are the business. willing to pay for increased credit. With average bunker fuel prices for For suppliers and traders, increasing intermediate fuel oil around $500 a tonne margins coupled with relatively low interest and credit so tight, cash flow is once again rates and the right customer can make dominating the bunker suppliers’ thinking. extending credit terms sound economic So much so, in fact, that the combination of sense in the current market. Companies high prices, low margins and increased credit which have invested heavily in credit control risk will inevitably see bunker suppliers re- evaluating the true value of dealing in high volume term contracts rather than spot ‘The combination of high Adrian Tolson is Vice President of Sales and deals. prices, low margins and Marketing of Chemoil, one of the world’s leading In a volatile market environment, sellers independent physical suppliers of marine fuel. that deal more in the spot market have been increased credit risk will able to benefit from increased margins. inevitably see bunker Contact Indeed, while this state of affairs continues, Adrian Tolson with high prices, questionable credit and suppliers re-evaluating Chemoil tighter margins, bunker suppliers are likely to the true value of dealing Tel: +1 415 268 2700 shift their focus back to more traditional spot in high volume term Fax: +1 415 420 0767 market bunkering. Email: [email protected] Not only has credit become a key issue, contracts rather than Web: www.chemoil.com but so too has securing insurance, with spot deals’ premiums becoming increasingly expensive
28 www.bunkerspot.com February / March 2010 bunkerspot Commercial Issues portunity
and management (as Chemoil has) therefore in fuel purchasing are a part of a cyclical have an opportunity to make risk assessment process of adjusting to market trends. With ‘Shipowners and operators comparisons with customers based on greater the bunker market facing considerable supply importance being given to credit interest side cost volatility, tighter margins and fuel are not exclusively premiums than the margin of the fuel oil. A oil scarcity in many ports, it is likely suppliers focused on price in the new world order indeed. will either push for higher contract prices or a The outlook is uncertain. Opportunities shift to the spot market that enables flexibility new economic world. in the market remain and Chemoil has for suppliers to adapt to unpredictable market Purchasers are also benefited from its strong financial position, trends. looking for longer term global reach, customer relationships and For shipowners, used to many years experience in the bunker market to show of close ties and long term contracts with deals and are willing to pay strong bunker retail sales in many of the bunker suppliers, the change in supply for increased credit’ markets it operates in. Nevertheless, risks patterns matched with reduced credit is likely remain high for bunker companies and credit to lead to more hours in purchasing bunker risk management has become an essential fuel and tougher bunker fuel negotiations part of operating a bunker company – a with bunker suppliers. factor that will remain in place even once Bunkering, like shipowning, is a the current path of economic downturn has competitive market and when it comes to been negotiated safely. managing the ripple effect of the recession, For Chemoil – a company that sells bunker suppliers will seek to adjust their actively in the spot market as it does in the terms of business in 2010 to the new world term contract market – the current changes order.
bunkerspot February / March 2010 www.bunkerspot.com 29 Risk Management Safety matters
he financial turmoil that the need to identify income structure. The use of Henrik Zederkof of world markets have experienced hedging as described above does not provide Dan-Bunkering expects Tduring late 2008 and 2009 has the shipping company with additional forced financial institutions and shipping security and the hedge turns into a gamble to see a growing companies to adjust their way of doing rather than an attempt to gain security. It is business. Banks have become more risk important that a suitable hedging strategy is interest in bunker risk averse and are demanding a higher level applied so the true purpose of the hedge is of transparency and security in future fulfilled – eliminating risk. A close dialogue management earnings. Because of this, more and with a professional and knowledgeable more shipping companies have been provider of hedging solutions is essential. forced to apply risk management to a greater extent than before. The crisis Hedging strategies has certainly emphasised the need for Several hedging strategies are available in effective risk management and there is today’s market and each offer individual no doubt that this tool will be at the top advantages. Products like fixed price of the agenda for years to come within agreements (FPAs) and maximum price shipping companies. agreements (MPAs) are good examples of There is a reason to believe that risk widely used strategies. Both products include management in fuel prices will be widely physical delivery of the product. A fixed applied in the forthcoming years. The most price agreement provides the buyer with a volatile and unpredictable entry in marine completely fixed cost level. Such a strategy accounts is fuel expenses. Bunker costs make might not be suitable for companies with up a high percentage of the overall cost of no fixed income. However, a fixed price running a ship. Hence risk management in agreement is perfectly suitable for cruise fuel prices will make sense to many shipping operators or shipping companies with an companies. Applying these tools to fuel prices income based on a COA. The MPA, on is a vital part of winning the battle against the other hand, provides an upper limit for volatile bunker prices. the bunker price without eliminating the Bunker risk management can eliminate advantage of decreasing bunker prices. Such or minimise the risk related to volatile bunker an agreement would be suitable for companies prices. It is a concept that incorporates that cannot afford to eliminate a potential several hedging tools and strategies, designed gain when prices are moving down. to meet the demands of shipping companies. In the past, bunker risk management has They provide the companies with the ability been disregarded by many, because hedging to fix cost at a certain level. The tools can was considered an unnecessary restraint on also be used to create floors or caps on the the flexibility of the vessel’s operation. Even bunker price. In other words, bunker risk though bunker hedging may cause a few management is used to secure budgets. limitations, new concepts have incorporated The financial crisis has not only increased a higher level of flexibility and today hedging the demand for risk management, but also tools can be customised to meet the demand taught us the consequences of applying for security and flexibility in one package. risk management tools incorrectly. Bunker Concepts like optional ports ensure that hedging has been blamed for decreasing vessels are allowed to bunker in various operational profits and has been used widely ports under the same hedging agreement. as an explanation by companies experiencing The optional ports concept allows the losses. For example, shipping companies shipping company to shift the contracted covered by bunker clauses will not gain from volume between any ports of their choice. Henrik Zederkof is the Managing Director of A/S hedging bunker costs. The combination of This option is very convenient for ships not Dan-Bunkering Ltd. bunker clauses and bunker hedging may trading regularly between a few ports and A/S Dan-Bunkering Ltd has been active in the even increase risk. Besides operational losses, shows that bunker risk management is also a bunker business for more than 30 years and today the use of hedging can lead to a loss of tool suitable for tramp operators. has offices in Middelfart, Copenhagen, Shanghai, competitiveness. Shipping companies in a Most hedging agreements also include Kaliningrad and Singapore. competitive market with no fixed income, the option to alter the type of fuel needed, such as contract of affreightments (COAs), ensuring that a shipping company has Contact: will experience a loss of competitiveness in maximum flexibility when it comes to Henrik Zederkof times of falling bunker prices. This is because deciding which ships to bunker under the Managing Director operational costs are kept high as the hedge agreed contract. These concepts are essential A/S Dan-Bunkering Ltd is offsetting the decline in bunker prices. In for the survival and development of bunker Tel: +45 6441 5401 return, the company will gain a competitive risk management. Naturally, hedging in its Email: [email protected] advantage in times of increasing bunker simplest form will be sufficient for some Web: www.dan-bunkering.dk prices. This example clearly highlights the shipping companies but a vast majority of them
32 www.bunkerspot.com February / March 2010 bunkerspot Risk Management
will require flexibility. Successful providers of hedging tools today makes it possible for all hedging tools will therefore depend on their types of shipping companies to apply bunker ‘Combining the practicality ability to develop new concepts and maintain risk management. Banks, financial institutions a high level of flexibility and customisation. and shareholders will focus even further on of the bunker and Companies involved in both hedging and risk management. shipping industry with the the actual supply of bunkers will maintain a possibilities of the financial competitive advantage, as know-how from Knowledgeable provider both worlds can be combined into one Buyers of sea transportation will experience world is exactly the package, providing end users with an all-in- a need for risk management and a demand challenge that providers of one solution. Combining the practicality of for flat freight rates without bunker clauses the bunker and shipping industry with the will emerge. As a result of this, more and bunker risk management possibilities of the financial world is exactly more shipping companies will need to learn are facing. A successful the challenge that providers of bunker the concepts of bunker risk management. risk management are facing. A successful Choosing a skilled and knowledgeable combination of the two is combination of the two is the very foundation hedging provider with experience from the the very foundation of a of a good hedging concept. bunker market is the first step in a successful risk management strategy. Suppliers’ ability to good hedging concept’ Flexible hedging tools understand shipping, bunkering and financial We believe that bunker risk management will markets is absolutely necessary to create a gain momentum and become an increasingly product that combines the practicality of used tool within all shipping segments in the shipping and the possibilities of the financial years to come. The flexibility incorporated in world.
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Volume 6 working in the international bunker industry. Number 5 October / November 2009 Our aim is to provide a comprehensive, accurate – and always independent – INDEPENDENT INTELLIGENCE FOR THE GLOBAL BUNKER INDUSTRY view of the multi-faceted global marine fuels industry. www.bunkerspot.com
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@S0 8217 Changes @: 30*7Debt Collection a subscription-based real-time news service, as well as information channels,l iindustryd t @:*1*11 @7 Technology .(* @*451* .80&3&,*2*3 &3)1 @*<8 &( 9 &3) *8 announcements and updates on conferences, exhibitions and other key events. ;*398 HIGH QUALITY INFORMATION AND TRUE VALUE FOR MONEYY Visit www.bunkerspot.com ♦ email [email protected] ♦ call +44 1295 814455 bunkerspot February / March 2010 www.bunkerspot.com 33 Risk Management Owning the future –
Chris Thorpe of ver the past two years, every kind of business has experienced ‘For business managers, HCEnergy gives an Osome kind of shock, wild there are very few things market condition or volatile price update on price action. The unexpected happened in that can be controlled areas where we least expected it, namely with certainty. Therefore, protection strategies to banks and financial markets which provide liquidity to global markets. Well we use strategies that capitalised corporations were quickly position the business having trouble accessing short term capital which had once been ‘guaranteed’ to benefit from our to them. The ensuing volatility in the competitive advantage, markets was worse than expected. In petroleum markets, we witnessed daily know-how, technology or nominal price moves never seen before. special knowledge’ And at that point, buying insurance to cap volatility was either not available or offered at exorbitant prices. to remain at low operating rates and bunker Have we learned our lesson or have we supply will remain tight. Any increase in been lulled back into a sense of false security? demand for bunkers in the markets will Some analysis of petroleum volatility suggests surely lead to a price rally. that market participants may not be preparing As we look forward, we can imagine a for any surprises in the future. number of scenarios that will affect businesses Global demand for petroleum products exposed to fuel price volatility. The US dollar dropped sharply in 2008 in the wake of could weaken even more as deficits grow in concurrent market crises in developed and a stagnant GDP environment. In this case, emerging markets. In the United States, crude prices could rise significantly. Portfolio consumer demand, which is two thirds of Gross managers may continue to emphasise owning Domestic Product (GDP), fell dramatically as commodities and especially oil given their credit lines dried up and home values sank seemingly unanimous belief in the ‘Peak to the point where many owners ended up Oil’ theory and the recent memory of with negative equity. The loss of wealth had $150 a barrel. Furthermore, any increase in a dramatic impact on consumer behaviour a perceived probability of an Iran conflict and consumption patterns that affected affecting the trade through the Strait of energy demand. Since that time, demand for Hormuz could also lead to a spike in crude refined petroleum products has remained oil. And, unless refining margins improve, weak, especially in the transportation sector. bunkers could follow crude on the uphill As a reflection of slowing demand in trade, climb. sea freight price indices plummeted to new The good news is that the market is not lows by the second half of 2008. Even today, factoring in a significant change, and implied freight demand has not recovered. A recent volatility in the pricing of crude oil options report from the Association of American illustrates the point. Implied volatility is Railroads showed that rail freight has fallen a measure of the market’s expectation of a to a low not seen since 1988. product’s future price swings. The realised Chris Thorpe is a Managing Partner with HCEnergy Due to frail demand and weak prices, volatility is what we record as it happens. The LLC. thin refining margins have pushed higher peak of implied volatility was 106.50% – 30 HCEnergy is a dealer of commodity options, cost players to cut capacity and even shutter days forward on the New York Mercantile swaps and futures with a focus on energy. The plants. Independent refiners (those that have Exchange (NYMEX) – was 16 December firm has offices in New York, Singapore and Zug, no upstream assets) face a very uncertain 2008. On 14 January this year, it was 33.29%, Switzerland, servicing counterparty clients that future – especially those that are highly closer to the historical average. What this use regulated exchanges as the principal clearing leveraged. At this point, it looks as if refineries indicates is a market which undervalues platform for trades. Regulated exchanges are will remain in a poor margin environment the potential of a surprise in the market or being strongly supported by US and UK/European at least through 2010. Crude oil prices that something occurring sooner than expected. legislation currently under consideration. seem to reflect more investor sentiment For business managers, there are very few than petroleum demand have become things that can be controlled with certainty. Contact: unpredictable, greatly reducing the value of Therefore, we use strategies that position Chris Thorpe fundamental supply and demand analysis. the business to benefit from our competitive HCEnergy LLC Lower throughput has limited bunker advantage, know-how, technology or special Tel: +1 212 774 5963 knowledge. Fixed costs, for the most part, are Email: cthorpe@ supplies and has offset weaker demand to hudsoncapitalgroup.com some extent. If crude prices increase without predictable in the near term. But variable costs improved demand, refineries will be forced that make up a large portion of profit margin,
34 www.bunkerspot.com February / March 2010 bunkerspot Risk Management – at a fair price
such as fuel in the transportation sector, can again in the coming years. When perceptions Locking in the price for that week would be managed in the form of forward price of risk become too low, implied volatility is already have a current book loss of $5 with an contracts (futures, options or swaps). often very low. almost unlimited maximum loss if the market The good news is that lower volatility Now let’s consider our perception of were to keep dropping (consider a double dip allows us to buy price insurance at much oil price risk. If we believe that petroleum recession). The $90 strike option would only lower prices than historically offered. Indeed, prices could drop quickly we may not want have a book loss (mark-to-market) of $2.50 the cost of insurance can change without to lock in current pricing. If we believe that with a maximum loss of $6.75 (the original notice. Think of trying to buy car insurance prices may increase with improving macro price paid). Therefore, we can illustrate the the day after you have an accident. economic conditions and fund flows, we benefit of owning insurance against the price At this point in time, one may characterise may want to protect against price increases. going higher while maintaining the benefit the market as stable or somewhat predictable The question that remains is: what premium of potentially lower cash prices. day-to-day. The problem is that periods of is affordable, within our business models and At least for now, options buyers can take stability tend to create complacency and even budgets, to pay in order to protect against advantage of more affordable conditions a perception of security. This can be compared potential price increases? to buy insurance against an anything-but- to the perception of risk which is heightened Using crude oil as a benchmark index, certain future. The cost of a price protection after a major shock even if the risk was the second half 2010 option to cap the strategy can be easily quantified and used in always present. Interestingly, the perception price at $90 a barrel is worth $6.75. If the budgeting process. Additionally, other of risk and the realisation of its existence can implied volatility were 10% higher, this price option strategies can be formulated to lower quickly fade from memory. Recall that the would be $2.70 higher (i.e. $9.45). To put the cost of insurance with limited risk. In a price of crude oil has increased over 100% this in perspective, the price of West Texas market with low implied volatility, you want from its lows in 2009. Yet, there tends to be Intermediate (WTI) crude oil moved over to own it, and be well insured for the next very little fear of price moving this much $5 in the week before I wrote this article. surprise, up or down.
bunkerspot February / March 2010 www.bunkerspot.com 35 Environmental Issues Cop out?
he Copenhagen Climate surprising and very unhelpful role, coming Bill Hemmings of T&E Conference and summit proved forward with a resolution at Barcelona which considers how the recent Textremely disappointing as sought to sideline Copenhagen altogether by regards bunker fuels. Progress on emphasising the primacy of the IMO’s role Copenhagen Climate bunkers within the International and proposing a very weak formulation for Maritime Organization (IMO) – and the medium and long term goals to be set in Conference will affect the International Civil Aviation Organization ICAO and IMO. It is hard not to see that (ICAO) – had been blocked during the this language wasn’t borrowed from the bunker industry year leading up to the conference with US-inspired ICAO objective of aspirational delegations arguing that they needed medium and long term goals. As if action on to see how parties viewed bunkers at climate was a series of voluntary options. Copenhagen before proceeding further. With Norway, the US, Canada and So we now have the answer; although Japan proposing no mention of targets in more discussion on bunker fuels at the Copenhagen, the EU ended up largely United Nations Framework Convention isolated on the issue, even though the IMO on Climate Change (UNFCCC) occurred went on record in the Subsidiary Body during the past three months than during for Scientific and Technological Advice the last 10 years, it proved impossible to (SBSTA) that it could live with targets being bridge the continuing differences. set at Copenhagen. At one point during a No consensus was possible on the final side event, Norway even acknowledged that versions of the Chair’s Long Term Cooperative UNFCCC could set the targets and indeed Action (LCA) draft text and there was no in the last draft negotiating text prepared by mention of bunker fuel whatsoever in the the Canadian and Venezuelan co-facilitators, Copenhagen Agreement itself – save a single the EU target figures re-emerged in brackets reference to innovative sources of finance with the word targets being replaced by which could be construed as also referring ‘sufficiently ambitious midterm and long to bunkers. term goals’. It had been hoped that Copenhagen would resolve or at least clarify the key Equal treatment bunker questions: A primary reason for raising the bunker ● should action to reduce bunker emissions fuel issue at Copenhagen was to resolve the be a responsibility of all Parties? competing principles of equal treatment ● do we need emission reduction targets? of aircraft and ships (ICAO & IMO) and And if so, who should set them? the UNFCCC principle of common but ● who should manage the process to agree differentiated responsibilities (CBDR) detailed measures and set timelines, etc? governing climate negotiations. China, Copenhagen has come and gone and we India, Saudi Arabia and a number of other are no wiser in the sense that no decisions key developing countries had made it very were taken on bunker fuel. But I think we clear in prior ICAO and IMO meetings that all have a much better idea now of where discussion of potential market-based measures people stand on the key questions and what – their global scope and application – could issues hold the best prospects for progress. not be progressed pending the outcome of This could help us chart a way forward. the Copenhagen negotiations. Some of us had expectations of a grand deal being struck Sectoral targets as part of the wider climate negotiations. The The Conference failed to act on the US position, evident before Copenhagen, was question of setting global sectoral targets for that it wanted no mention at all of bunkers at international aviation and maritime emissions Copenhagen, ostensibly out of a concern not because there was neither agreement on to see the principle of CBDR injected into whether the UNFCCC or ICAO/IMO bunker deliberations in ICAO and IMO. should set them, nor the level of cuts required. It was four days into the Copenhagen A number of developing countries signalled meeting before the bunkers drafting group that the European Union’s (EU) proposed met – and only after considerable pressure Contact: 10% cut for aviation and 20% for shipping had been exerted on the LCA Chair to Bill Hemmings over 2005 levels was too steep. Australia, agree to such a meeting proceeding under T&E - The European Federation for Transport and beset with political difficulties at home the umbrella of ‘other issues’. Several draft Environment over its green legislation, failed to follow texts then circulated within the closed group Tel: +32 2 893 0841 through with specific numbers on its call proposing that all Parties should address Email: bill.hemmings@ for Copenhagen to set the cap. Regrettably, bunker emissions reductions (rather than transportenvironment.org Australia then also failed to fall into line Annex 1 countries as provided for in Kyoto Web: www.transportenvironment.org behind the EU position. Norway played a Protocol Article 2.2) but that revenues from
36 www.bunkerspot.com February / March 2010 bunkerspot Environmental Issues
such measures should flow to developing represents a failed opportunity to use the ‘It was four days into the countries. The Norway version, supported by wider negotiations to resolve the issue and the US, Canada and Japan, made no reference interpret CBDR in the bunkering context Copenhagen meeting at all to the finance issue. It turned out later as applying to the disbursement of revenues, before the bunkers that the United States was blocking any not the global application of measures. mention whatsoever of climate finance in the Developed countries did not press the drafting group met – and bunkers context. issue because they were divided; Norway, only after considerable Early in the second week, the Norwegian the US, Japan and Canada versus the EU, pressure had been and Singaporean Environment Ministers with Australia somewhere in the middle. sought to develop their own draft text which Developing countries were equally divided; exerted on the LCA might be acceptable to Parties. It differed China, India, Brazil, Saudi Arabia and South Chair to agree to such little from Norway’s original watered down Africa and others versus a good number of resolution, referred to the need for bunkers Least Developed Countries (LDCs) mainly a meeting proceeding to be addressed at the IMO and ICAO in Africa (notably Malawi) and Small Island under the umbrella of and avoided specifying whether ‘Parties’ or States, though some in this latter group were ‘Annex 1 Parties’ should do this. These efforts not vocal because of concerns – justified or “other issues”’ also failed to gain traction. otherwise – that they would ever see the money. Singapore and the Bahamas played What’s left after Copenhagen? a spoiling role on bunkers within the Small Firstly, a heightened profile for bunkers and Island Developing States (SIDS) group. a widespread awareness that revenues from potential global mitigation measures could Global measures be very substantial and could play a major The shipping industry’s call for global measures role in climate finance at some stage in the and even target setting at Copenhagen has future. The latest LCA text importantly now also not borne fruit. Will pressure to continue contains a paragraph calling for revenues pursuing these objectives be maintained from bunkers measures to be made available by industry at the IMO in 2010? There are to support climate change mitigation and clear proposals before IMO for a global levy adaptation in developing countries. and emissions trading and (US) for trading But set against this is a renewed sense based on the Energy Efficiency Design Index that we need more clarity and certainty with (EEDI). Will MEPC move to address these regard to bunker fuels. With the Copenhagen proposals fully now? The motivation to skirt Agreement not even mentioning bunker fuel, the major controversial aspects - including will they reappear in any Mexico text? Will global application - in order to preserve a they be picked up again at the reconvened united front of unity and harmony before LCA talks in Bonn next May? ICAO and Copenhagen has presumably disappeared the IMO will proceed to discuss further the now. Is there sufficient political will to adopt issues at their upcoming meetings in 2010 the EEDI as mandatory? Parties and industry but without the guidance on the key issues will need to declare themselves on some of from Copenhagen that both organisations the key issues now. claimed had been preventing them from making greater progress. Will the next delays Forward position be blamed on the need to wait for Mexico? In the meantime, the new European The last LCA text on bunkers, which did Commission (EC) and Parliament must not gain a consensus at Copenhagen, referred now be looking seriously at the EU policy to all Parties addressing bunkers through on international shipping. Having taken a global measures. Will this formulation take forward position on bunkers at Copenhagen, precedence over Article 2.2 of Kyoto? it must be quite a lot clearer now for the Will ICAO and the IMO seriously EU where everyone stands on the issues – address the question of targets? Target including key developed countries, as well as setting is not on the IMO agenda. Will it those blocking in the IMO – China, India, be proposed at Marine Environment Brazil, South Africa, Saudi Arabia, etc. The Protection Committee (MEPC) 60? EU is on record since 2003 about the need ICAO made clear at its Copenhagen side to reduce shipping emissions unilaterally if event that it believes the annual 2% fleet the IMO does not act. Copenhagen would efficiency improvement aspirational goal is a seem to represent the green light the new target in itself – possibly to be supplemented EC needs to take out of the top drawer in by some version of the International Air the next few months the draft Directive its Transport Association’s (IATA) carbon officials have undoubtedly been putting neutral growth in 2020 concept. together and commence the process of On the CBDR principle, Copenhagen agreeing legislation.
38 www.bunkerspot.com February / March 2010 bunkerspot Environmental Issues Power talks
Susann Dutt, he results of a new survey canvassing opinion within the ‘The respondents who are Environmental Controller Tglobal port community on the also members of the WPCI use of cold ironing, or Onshore Power at the Port of Gothenburg, Supply (OPS), as part of the World showed an even higher Ports Climate Initiative (WPCI), show interest in OPS’ reveals the results of a that there is a strong appetite for this technology. survey on the adoption of In July 2008, 55 of the world’s largest ports attended a conference in Rotterdam to ports), North America (4), Asia (3), Australia/ cold ironing undertaken look at ways of countering climate change, Oceania (3), and Africa (2). Some 24 of these as part of the World Ports and the culmination of the event was the respondents were WPCI member ports. implementation of the WPCI and the signing The results of the survey indicate that Climate Initiative of a climate declaration. around one third of the respondents are A number of projects have already been already providing OPS. The main arguments launched by individual ports in support of the driving the introduction of the technology in declaration, including carbon footprinting, these 17 ports are its environmental benefits the development of an environmental (94%), customer demand (70%) and port ship index, intermodal transportation, reputation/goodwill (59%). When indicating International Association of Ports and environmental benefits as an argument the Harbours (IAPH) toolbox expansion and following pollutants were cited as the most the use of OPS. important: nitrogen oxides (83%), carbon A formal working group on the adoption dioxide (81%) and sulphur (81%). of OPS was formed in Spring 2009. The A majority (93%) of the respondents Port of Gothenburg is the project co- require private operators to pay for the ordinator and other participants are the ports use of OPS in situations where the port of Amsterdam, Antwerp and Hamburg, as authority has itself funded the creation of well as the IAPH. the OPS infrastructure. Some 38% of the The scope of the project is the reduction ports that replied to the questionnaire have of local air pollutants and greenhouse gas already carried out a feasibility study for emissions (GHGs) by encouraging many the introduction or increased use of the ports, terminal operators and shipping lines technology, 21% have a study in progress, and worldwide to implement the technology of 49% gave a negative reply to this question. OPS where practical and useful. The respondents who are also members A specific aim of the initiative is the of WPCI showed an even higher interest design of a web-based application which in OPS; some 55% have already carried will provide practical guidance on OPS and out a feasibility study, 21% are currently will be available for all ports. The application undertaking such a study, while only 22% are should also contain information for other not taking any action as yet. stakeholders, such as terminal operators and A total of 85% of the 53 respondents shipping lines. answered ‘yes’ or ‘maybe’ to the question: One of the first tasks of the OPS working ‘Is your port planning to introduce/expand group was to put together an electronic the technology to more quays within 5-10 questionnaire so as to gain information from years?’. Of the WPCI ports, 96% replied ‘yes’ ports about their current or intended use of or ‘maybe’ to this question. The ports that OPS. The feedback from the survey will be appear to be the most reluctant to invest in used to inform ongoing work within the OPS are those who have no prior experience OPS project, and also as a reference source in of the technology. future project evaluation. While 85% of all respondents said that Last summer, the electronic questionnaire environmental benefits were key in their For more detailed information and to download was sent out to all the 55 WPCI member decision to use OPS, some 48% pointed to the report on the OPS survey, go to the Port of ports. Special invitations to fill in the its benefits for society, 63% suggested issues Gothenburg website: www.portgot.se questionnaire were also issued to the port of good will and reputation, while only 20% Information on the World Ports Climate Initiative can community via the European Sea Ports cited economical benefits as an argument. be found at: www.wpci.nl Organisation (ESPO), the GreenPort The result among the WPCI ports Journal, WPCI website, Port of Gothenburg differs somewhat: 100% of these ports chose Susann Dutt website and also different port associations. environmental benefits as the main argument, Environment Controller All responses have been treated anonymously followed by reputation/goodwill (81%) and Port of Gothenburg and in confidence. benefits for society (62%). Tel: +46 31 731 29 63 The 53 ports that filled in the electronic The majority of the ports who replied Email: [email protected] questionnaire were drawn from Europe (41 (86%) are going to choose high voltage OPS
40 www.bunkerspot.com February / March 2010 bunkerspot Environmental Issues
and only 14% will invest in low voltage environmentally differentiated harbour dues to technology. Among the WPCI ports, all are stimulate clean shipping, Advanced Maritime ‘A specific aim of the planning to invest in high voltage. Emissions Control Systems (AMECS), waste When asked why OPS technology has collection, an Environmental Ship Indexing initiative is the design of not already been introduced at some ports, System, and exhaust scrubbers. a web-based application 88% of respondents said that it was because The results of the questionnaire clearly no feasibility study had been carried out, the show that there is a strong interest in OPS and which will provide practical cost effectiveness of introducing OPS was too all but one port would like to be informed guidance on OPS’ low (75%) or there was a lack of sufficient about the progress within the WPCI OPS power onshore. project. Further comments about the difficulties The WPCI OPS Project will stimulate in introducing the technology included: an the further use of OPS by designing and absence of technical standards, the integration building a web-based application which will of external costs, and the security of constant provide practical guidance on OPS for all power supply. ports, and the information provided by the The ports offering OPS today and the ports via the questionnaire will be extremely WPCI ports seem to be more environmentally useful in creating the website. proactive as 58% and 70% respectively are An update on the WPCI OPS project considering other measures to improve the will be given at GreenPort 2010 (www.green- environmental performance from shipping port.net), on 24 February in Stockholm, and while at berth compared to the overall result the website will be available from March of about 50%. Measures mentioned include 2010. Coutonou Lagos Abidjan
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bunkerspot February / March 2010 www.bunkerspot.com 41 Environmental Issues Changing tack
Diane Gilpin of 9 Shipping is tackling the problems of vessel carbon emissions ‘Apart from the B9 Shipping outlines Bthrough the development of a environmental advantages, new cargo vessel that will rely primarily the company’s plans to on sails, augmented by a carbon-neutral our ships will bring real bio-methane engine. cost benefits’ develop a cargo vessel The company is part of the B9 Energy Group which focuses on renewable energy which uses carbon- technologies, putting together teams to steel profiling techniques with advanced rapidly develop viable environmental projects computer modelling. Each kit is supplied neutral propulsion in different sectors. B9 Energy is active in the fully developed to the ship yards with limber technologies onshore and offshore wind sectors – being holes, stringers, slots, jig parts and fitting the largest independent operator of wind details. Automatic line and text marking farms in the UK and Ireland. B9 Organic ensure an efficient, error free build where Energy develops anaerobic digestion waste is minimised. Welders manufacture the plants to produce bio-methane, while other vessels on site whilst boat shape and quality divisions within the group focus on wet are optimised. Build times can be reduced by renewables – wave and tidal energy. The 20%, with even greater reductions for repeat group recently formed a new company, B9 builds. Shipping, to build on a project first started Health and safety considerations have a 20 years ago – the design of a commercially big impact on the vessels’ design. It is not viable cargo ship that has no dependency on acceptable to require crew to climb high fossil fuels. into the rig for sail setting, trimming and The first vessel is due to be launched in furling. While the new vessel has a passing 2012, and will initially be used to import bio- resemblance to a traditional square rigger, all material from the Baltic area to be utilised by sail operations are controlled from deck level, new biomass power stations opening across the conventional, soft sails being deployed in the UK. the manner of very large roller blinds. The ‘The International Energy Agency unstayed rig ensures that access for cargo (IEA) has estimated that biomass power operations is as unencumbered as possible. generators will need up to 45 million tonnes Collaboration with the UK Met Office of biomass a year,’ says Diane Gilpin, Director has allowed the company to draw on over 30 at B9 Shipping. ‘If the bio-material is years of historical data to predict both journey transported into the UK using fossil fuel, this times and operational capacity. It anticipates negates some of the emissions saved in power that over the course of one year, about 60% generation. Our new vessels, by contrast, of the thrust will come from conventional are ideally suited to relatively short trips soft sails. For the remaining 40% of the time, of about 1,000 nautical miles (nm) making in calm conditions or to manoeuvre in port, a the great biomass sources of the Baltics well carbon-neutral bio-methane-powered Rolls within the company’s range, enabling it to Royce spark ignition engine will be used. offer a commercially viable, environmentally With such careful planning, the company has friendly shipping alternative.’ already been able to set competitive freight The new B9 ship uses proven rates. technologies in an innovative way. B9 B9 Shipping is planning to build a Shipping has acted as a catalyst to bring second demonstrator in 2012, specifically together significant market players, including designed for liquid cargoes to accommodate Rolls Royce, Graig Investments, Corus the growing demand for transporting liquid Steel and Akzo Nobel’s International bio-fuels. Paints. They have also collaborated with the ‘Aside from the environmental advantages, University of Hull’s Logistics Institute and our ships will bring real cost benefits,’ says B9 Shipping, part of the B9 Energy group, has been the University of Southampton’s Wolfson Diane Gilpin. ‘Not only will our rates be formed to develop a commercially viable cargo ship Unit. The design itself is by Rob Humphreys, competitive with the general market, but that has no dependency on fossil fuels. the naval architect responsible for Dame we will offer the same or even more reliable Ellen MacArthur’s record-breaking yacht, scheduling as other freight carriers. We can do Contact: Kingfisher. this for two reasons. First, the amount of fuel Diane Gilpin The design brief was to create ships used is less than in a regular ship because our B9 Shipping that are straightforward to build. The design vessel relies mostly on wind. Then, because Tel: +44 1380 812 657 uses steel ship kit technology, first used the biogas on which the engine runs will be +44 7768 312 176 to develop a fleet of prestigious round- supplied by our sister company, B9 Organic Email: [email protected] the-world racing yachts for the BT Global Energy, we can fix our prices for the next Web: www.b9shipping.com Challenge and which combines sophisticated 10 years. A conventional shipper using fossil-
42 www.bunkerspot.com February / March 2010 bunkerspot Environmental Issues
fuelled ships has no control over the price it In B9’s 17-year history of socially and has to pay for fuel, so it can’t fix such a good ‘Because the biogas on ethically responsible employment has been deal for its customers into the future.’ key to the company’s continued, solid growth which the engine runs will and the company is also looking forward to Ambitious targets be supplied by our sister creating a stimulating and exciting working The company anticipates a need for 50 company, we can fix our environment for its crew on-board the ships by 2020, to give the biomass industry vessel. compliance with the 10% energy in transport prices for the next 10 years’ ‘We want to transfer technology from target of the Renewable Energy Directive. offshore yacht racing for commercial use just Other significant opportunities are emerging of similarly sized coasters they will save some as has been done in motor racing for years,’ for fossil-fuel free coasters during the 48 million tonnes of carbon each year but says Diane. “Sailing can be hard work, but we transition to a low carbon economy – liquid that these new environmentally sensitive will incentivise our crews by letting them bio-fuels, recyclate and captured carbon ships can also open up new opportunities share in the returns of the company. The destined for sequestration in end-of-life gas across the world. more they work under sail, the less fuel we and oil fields. Over time, further opportunities B9 Shipping will build its ships in the UK, will need to use, and we would share these will arise to replace the 10,000 similar sized in places like Hull and Sunderland. This will savings with them as part of our motivational coastal vessels operational across the world. create new jobs and bring about regeneration remuneration packages. We aren’t averse to Reliable, affordable small-scale ships are also in these areas, where the shipping industry the idea that several vessels in a fleet might ideal for stimulating growth in small island once thrived. However, the straightforward be competing to out-perform each other, developing countries – often those most design ensures that the technology employed not unlike the tea clippers that used to sail at risk from climate change. The company can be transferred to yards in developing around the colonies in the 1800s – which is calculates that by replacing the existing fleet countries. the origin of modern offshore yacht racing.
bunkerspot February / March 2010 www.bunkerspot.com 43 Environmental Issues Reap the wind
Why is the shipping he United Nations climate meeting in Copenhagen this ‘Not only does shipping industry hanging on the TDecember failed to provide have to clean up its act in a binding legal agreement to address outcome of COP15 and the climate change urgency. More respect of carbon dioxide, specifically to the shipping industry, it but there are technologies developments at the IMO failed to meet the expectations of the International Maritime Organization that can help the industry when it already knows (IMO) to set an emission reduction achieve that. What is what it can do to address target for shipping. Nor did it reconcile the IMO’s primary principle of equal needed is the willingness climate change, asks treatment of all ships regardless of the to implement them’ flag of origin with the Kyoto’s principle environmental charity of differentiating climate responsibilities for sustainable, retrofit solutions with no Greenwave according to the economic capacity of additional crew requirements and a payback its nation. period of a maximum three years. The IMO’s Marine Environment Rather than spending valuable time in Protection Committee (MEPC) meets in marine conferences debating the pros and cons March and, with no guidance by Copenhagen of cap and trade, fuel levy or carbon credits, or deadlines, the prospect to plot its own Greenwave prioritised the task to develop a shipping emissions reduction action plan renewable technology that will significantly seems impossible. Unilateral legislation reduce a vessel’s fuel consumption and within regional schemes is now likely to consequently reduce its harmful emissions accelerate: the EU has committed that it too, thus satisfying both sides. will regulate the emissions from shipping if The charity’s R&D team, manned with a global agreement would not be reached aerodynamics and hydrodynamics experts and the US is already moving to draft its own and based both in New Zealand and the UK, regulations. brainstormed and experimented in wind Greenwave travelled to Copenhagen tunnel tests and weighed on which ideas and and its Head of Communications, Colin concepts would deliver the best results. They Whybrow, attended the joint reception concluded to focus in the Flettner Rotor, organised by Maersk and Carbon War a spinning rotor that successfully sailed the Room, an organisation aimed to bring Atlantic back in 1926 (see Bunkerspot, together successful entrepreneurs with August/September 2008, page 30). The institutions and experts with market-driven Flettner Rotor was renamed Wind Engine, solutions to climate change. The common the team rolled its sleeves up and set to apply feeling within the reception was that a new design, material and manufacturing ‘not only does shipping have to process to bring this proven concept up “clean up its act” in respect of to date. carbon dioxide (CO2) but that there The team was then hosted at are technologies that can help the the Warsash Maritime Academy industry achieve that. What is needed is where a scale model was made available the willingness to implement them,’ said to Greenwave to carry out a series of Whybrow. ‘The lack of directions on performance, handling and stability tests emission reductions is just a convenient of the wind engines. The results were excuse for many to do nothing,’ he remarkable and proved that wind assisted added. ship propulsion is possible and can produce From the foundation of Greenwave, significant fuel and emissions savings in Greenwave is a UK registered charity which aims its Research and Development (R&D) favourable winds. The tests showed that to remind the shipping industry of its environmental team focused on conceptualising the benefits of wind engines were not obligations and to create sustainable ways to technologies that will satisfy limited to environmental and costs saving. meet them. the industry’s pragmatic need They were also tested successfully in manoeuvring and crash stopping of the Contact: vessel when counter rotated. Dimitra Spatharidou With the industry’s magazines and Greenwave Tel: +44 207 977 1734 Fax: +44 207 977 1711 Email: [email protected] Web: www.greenwave.org.uk
44 www.bunkerspot.com February / March 2010 bunkerspot Environmental Issues
newspapers picking up the story of the scale 2009. A massive 20 metre (m) rotor is sitting Engines for sea trials. model trial, the charity made the news, proudly at the Port of Blyth, which kindly Environmental technologies in shipping enjoyed its moments of publicity, featured at offered its land to become the construction exist and will reach the mainstream market, the BBC driving the scale model – and then and testing place for Greenwave rotors. sooner rather than later, with or without IMO disappeared from the public domain. It has Lloyd’s Register has been with regulations. Leading enterprises, suppliers, been more than a year since Greenwave made Greenwave from the beginning of the project operators are exploring and developing the headlines – but the work hasn’t stopped, it and its inspectors were present during the use of renewables, fuel cells, carbon capture has intensified. construction and trial of the wind engines. and storage, air bubbles, energy management Having acquired limited funds from a They verified the results that concur with the and even nuclear energy. small number of shipowners and operators, wind tunnel results carried in New Zealand’s What is unique about Greenwave is its the team focused on building a full scale Auckland University. ambitious business plan where the Wind prototype. This phase was bound to prove The Wind Engine project has reached its Engines will be developed on a not-for-profit the most difficult as it would identify all penultimate stage with the building of the basis. Manufacturing, fitting and servicing mechanical and electrical issues encountered full scale rotor at Blyth with test performance will be licensed back to the shipping industry, on the tests and the feedback was to be confirming the potential for this technology. creating green jobs, and the profits generated used to the benefit of the subsequent model It has showcased that an annual average of from royalty fees will fund the next generation that will sail to sea trials. The process of 13% reduction in fuel consumption and of R&D products. manufacturing and assembling the Wind harmful emissions is possible. This result The shipping industry must rapidly Engine has been an important learning curve is calculated on the basis of ships’ fleet log accelerate action to mitigate its greenhouse for its future development. books of winds encountered through the gas emissions (GHG) and Greenwave is The Wind Engine assembly and data whole year in all five oceans. Next stage is sailing towards this direction, benefiting both gathering finally came to an end in October pre-production development of two Wind the industry and the planet.
By far the most dramatic − and nostalgic − bunkering event of 2010
17th - 19th March 2010 Onboard the SS Rotterdam, Rotterdam, The Netherlands
ForF more informationi f i aboutb this unique event, contact: LukeL Hallam Evans | Tel: +44 1295 814455 Email: [email protected] Web: www.aracon2010.com
Platinum Gold Silver Bronze
46 www.bunkerspot.com February / March 2010 bunkerspot Technical Issues An industry in tran
ne of the things that make the around 10 years, is the foundation for the Jon Watson of Razaghi marine industry so interesting RMI’s INtegrity fuel quality assurance Meyer International Ois that it is full of contrasts and solution. in a constant state of change. The bunker industry has proven argues that bunker The twin concepts of ‘unmanned somewhat reluctant to adopt viscometers for machinery space’ and the ‘computer fuel quality assurance. suppliers should look controlled bridge’ have been the main drivers In some refineries and on some of change and now pollution legislation barges, viscometers paid for themselves by at the benefits of and the need for ‘value for money’ can be eliminating the ‘give-away’ where they are in-line sensors added. Ships today rely on increasingly used for blending trim control. But just for sophisticated systems and instrumentation quality checking, instruments have not so far to deliver these goals and the latest addition proven attractive to the industry. that will influence the bunker industry is the Why? One of the main reasons, it installation of Coriolis meters on ships. transpires, is because there are some features But the bunker industry seems to be of fuel management that the industry does stuck in the past. Instrumentation is almost not want exposed. Fuel management suffers non-existent and very little about fuel greatly from a lack of investment. Even management has changed over honest suppliers know the fuel quality is not the years. always whatwh it should be and the lack of Why not? instrumentationinstrumen is an open invitation to Bunker operations fraudulentfraudul supply. have always been driven TheTh fuel might not be by price. Fuel quality is homogenoushomo (as required by the bad because no one would InternationalIntern Organization for pay the price improved Standardization’sStand ISO 8217), it may fuel management would cost.st. bebe a consolidationc of different batches, Even in major bunker ports,s, the port oror it maym have stratified in storage or authorities legislate with ‘a lightght touch’touch’ bbegunegu to separate. It may be aerated. – push the price too high and ships start AllAll of these things go undetected to bunker elsewhere. dduringur bunkering if the operators One of the keys to betteretter fuel rrelyely only on off-line testing, and the management is instrumentation.tion. In the lablab analysisa is too late. last 10 years or so, there hass been a small SSooner or later, MARPOL will but significant change wroughtought by the bringbrin sufficient pressure to bear introduction of new viscometerer technologies toto change this. Instrumentation – but the main impact has beenbeen on vessels, cancannot be resisted forever, but not in the bunker industry. tthehe opportunity to use a single The capillary viscometereter was the vviscometerisc for fuel quality assurance industry standard instrumentnt for fuel oil maymay be slipping. Mandatory changes heater control, but about 10 years ago the are likely to require in-line fuel new digital viscometers took over.over sulphsulphur analysers and fiscal density The ‘unmanned machinery space’ concept meters. was the main driver behind this change but Of course, instrument price has a while digital viscometers deliver virtually zero part to play. An in-line viscometer system maintenance, do not require re-calibration, that measures density and viscosity is a lot Razaghi Meyer International specialises in process and don’t rely on skilled operators, the most cheaper than an in-line density meter and density and viscosity measurement solutions successful design satisfied another pressing an in-line sulphur analyser, but until there providing consultancy design and supply of instruments and systems. The addition of the LEMIS need: fuel quality monitoring. is no other option than to fit instruments, product portfolio extends the range of applications Engine manufacturers had only the the old methods hold sway. This lack of to include fixed tank, portable and bench-top Bunker Delivery Notes (BDNs) to tell them instrumentation, or rather the fear of what measuring solutions. RMI also created the INtegrity about the quality of the fuel claimed to have instrumentation might reveal, is holding fuel quality assurance solution. been used, but no means to verify these back efforts to approve in-line blending in claims. The tuning fork viscometer not only Singapore – with all the attendant benefits Contact: gave true kinematic viscosity, it also measured that might bring not just in Singapore but Jon Watson the density and enabled the engine’s ‘black elsewhere. Razaghi Meyer International box’ recorder to log viscosity at 100°C and But the other driver is the end user quest Tel: +44 560 257 9618 density at 15°C – two factors that act as a for ‘value for money’. Some major shipping Fax: +44 7092 809 181 fingerprint for the fuel. This finally allowed companies now fit Coriolis mass meters to Email: [email protected] them to accurately evaluate reported fuel check deliveries. Web: www.viscoanalyser.com usage. This concept, used for engines for Coriolis meters can meet fiscal standard
48 www.bunkerspot.com February / March 2010 bunkerspot Technical Issues sition?
density measurements. Can the hydrometer a commercial advantage. But for fuel oil readings during bunkering hold up? How blending and bunker quality assurance, it is ‘One of the keys to better robust are the industry’s current methods? the same affordable LEMIS sensor that does Recently, the accuracy of a density both jobs and here it has an advantage in fuel management is calculation spreadsheet used by a number of quality assurance: its density measurement is instrumentation. In the operators in the industry (Density 12MD. of a fiscal standard. last 10 years or so, there xls from www.viscoanalyser.com), was But where this new technology really challenged. scores is its flexibility. has been a small but A surveyor asked why, LEMIS has replaced the weight on a significant change wrought with a hydrometer conventionalconventi tank dipping tape with a digital reading of 740.6 viscometerviscomet and has electronic sensing of by the introduction of new at 33°C, did the tapetape extensionexte and electronic data logging. viscometer technologies spreadsheet return The systemsyste can data log and profile the tank – but the main impact has the base density as contents according to depth. So, in this one 756.53 kilogrammes sensor, theth operator can determine the tank been on vessels, not in the per cubic metre (kg/m3) contents,contents, detect entrained air (as per any bunker industry’ and a computer programm digitaldigital viscometervi or density meter) discover 756.4kg/m3? (Table 53BB thethe homogeneityhom of the fuel and, from the gives 756.5kg/m3). densitydensity at 15°C and viscosity at 50°C, Another program used inin validatevalidate the BDN (which must report the the industry gave the same exactexact densityden for MARPOL) while the fuel answer as this program, is still in the barge compartments. and both disagree with This represents a great benefit for the spreadsheet and withh ships’ engineers,en fuel suppliers and bunker tables. surveyors,surveyors because sample taking is much In fact, any hydrometerer reducedreduced and time is saved. It may also benefit reading between 740.3 to PortPort StateStat Authorities who need an effective 740.7 got the same answer from the programs,programs, testtest to identifyid which vessels warrant detailed due to rounding the hydrometerydrometer reading inspection.inspectio to the nearest 0.5: 740.3-7 becomes 740.5; Few process sensors make good lab giving 756.4kg/m3 which is then consistent instruments, but a LEMIS bench top sensor with tables (calculation: 756.43kg/m3). will report both density and viscosity from Coriolis meters report to two decimal one instrument. places, yet here the industry is reporting to The LEMIS sensor is thus available for only 0.5kg/m3. in-line, fixed tank, tank dipping and bench The Manual of Petroleum Measurement top measurements, offering density and Standards and the American Society for viscosity in one instrument. Its versatility, Testing and Materials’ ASTM D1298 accuracy and affordability could enable the both state that it is the calculation that is the standard and not the tables – but not in the bunker industry. In the past, this sort of accuracy has been ‘good enough’, but how will hydrometer measurements perform when pitted against Coriolis meters? ASTM D1298 says density can at best be to 0.1kg/m3 using hydrometers and tables, in-line sensors and calculation deliver answers to two decimal places. How does the industry come up to speed bunker industry to quickly catch up with the without spending too much? And what is the rest of the shipping industry. way forward? Sadly, we still have to overcome the real Razaghi Meyer International problem – the lack of investment in fuel (RMI) has found a new ‘next generation’ management that any in-line or portable technology: digital density and viscosity sensors will expose. But will the industry sensors manufactured by LEMIS which are continue to wait until it is almost too late, or based on the well-proven vibrating cylinder will some operators recognise the inevitable principle. and steal a march on their competitors? In-line sensors will do just what the The initiative has so far been taken by current heater control viscometers will the shipping companies but is it time for the do, but it is expected that there will be suppliers to recover the high ground?
bunkerspot February / March 2010 www.bunkerspot.com 49 Technical Issues Nearly there?
Andrew McEwen of orking within the bunker industry, it will have been ‘Such major changes to the Guardian Marine Testing Wdifficult not to have noticed fi the recent ongoing discussions and quality speci cation will comments on the debate surrounding the proposed require time for all industry changes suggested in the International continuing debate about Organization for Standardization’s ISO stakeholders to prepare 8217 marine fuel oils specification which and be ready to offer fuel the proposed changes to is due to be published in July 2010. The International Maritime which will comply with the ISO 8217 Organization (IMO) is the clear driving new specification and it force behind the changes, with the spotlight focused on shipping to ‘clean up its act’ with affects all areas, buyers, regard to the environment. The pressure has suppliers and, in our case, fallen squarely on the shoulders of the ISO Working Group 6 to rapidly evolve the well the testing industry’ known bunker specification. As Chris Fisher pointed out in the last that fuel issue of this magazine, the ISO DIS 8217 ● Aluminium (Al) and Silicon (Si) content draft proposal has some radical changes and (cat fines): the maximum limits for these amendments (see Bunkerspot, December/ elements have been reduced to offer better January, page 36). protection against wear damage. The Al+Si Here is Guardian Marine Testing limits for residual fuel grades proposed in Ltd’s (GMT) take on the key changes: the new standard are 40 milligrammes per kilogramme (mg/kg) for RMA to RME What’s new? grades and 60 mg/kg in the higher viscosity ● Strong Acid Number and Acid Number: grades RMG to RMK grades to identify any acidic compounds which lead ● The Specification Tables: there have been to accelerated damage to marine engines category rationalisations of both distillate and ● Calculated Carbon Aromaticity Index residual marine fuel grading(s) (CCAI): is calculated from the density and - RMA 10 is added viscosity and provides an estimate of the - RMG & RMK are expanded to include ignition delay of the fuel additional viscosity grades ● Sodium content: added to the existing - RMF & RMH categories are removed list of metallic components, sodium gives a ● Clause 5 – ‘General requirements’ good indication of sea water contamination (clause 5.1 in the current standard): contains as well as potential damage from vanadium/ substantial amendments sodium corrosion ● Informative annexes: amendments and ● Hydrogen Sulphide (H2S): aimed to add additions. protection to onboard staff whilst storing The draft containing some 33 pages and handling of fuels. Inclusion into the of information was published in August specification has been deferred until 2012 to 2009 and there followed a balloting process allow ISO more time to finalise test precision encouraging feedback and public comments. and specification limit issues. The closing date for input was mid- December. The working group comprises 33 Specifically for marine distillates expert members from 14 countries, drawn ● Stability (oxidation): to identify oxidation from all sides of the marine fuel industry, which leads to instability of the fuel during who must now review the feedback before storage agreeing on the final version in time for the ● Lubricity for ultra low sulphur (ULS) July deadline. distillates (defined as those with a sulphur Many parties have commented privately content of <0.05%): to ensure against adverse and publically with a mixed bag of opinion. effect on engines due to lack of natural The telling decisions will be taken shortly Andrew McEwen is the Technical Manager of lubricating compounds stripped during the and more will follow even as this item goes Guardian Marine Testing Ltd (GMT). desulphurisation process. to print. Let’s hope a cross industry consensus Contact: can be agreed by all parties. Andrew McEwen What’s changed? Such major changes to the quality Guardian Marine Testing Ltd (GMT) ● Sulphur content: limit values are no specification will require time for all Telephone: +44 1642 440991 longer included in the draft ISO 8217 industry stakeholders to prepare and be Facsimile: +44 1642 458537 standard at all, instead it is up to the bunker ready to offer fuel which will comply with Email: [email protected] purchaser to specify the maximum sulphur the new specification and it affects all areas, Website: www.gmtlab.com content of fuels to the supplier in line with buyers, suppliers and, in our case, the testing the regulatory requirements for the use of industry.
50 www.bunkerspot.com February / March 2010 bunkerspot Technical Issues
One good example is the tighter It seems hard to believe that the fuel specification limits for cat fines which, suppliers will absorb any additional costs ‘Fuel suppliers will according to fuel suppliers, will result in incurred from providing fuels with tighter increased costs. The proposal is to reduce Al specifications as per the new standard – with be forced to source + Si content down from 80 to 60 parts per the assumption being that the costs will alternative blend stocks as million (ppm) for RMG 380 and 40 ppm for inevitably be passed on to the fuel purchasers. RME 180. Historically, acceptable levels of Will buyers be prepared to pay that premium? many cycle oils are high Al+Si content were set at 80 ppm maximum. Will the new version be taken up by all or in cat fines, leading to This level was selected on the basis that a only selectively? ship fuel treatment system could reduce the It is quite possible that ship operators elevated levels especially abrasive metals through purification by 75% may not be able to source fuel that meets in low sulphur grades’ to 85% to achieve the generally acceptable 15 both the environmental regulations as well ppm at the point of injection. The working the new specifications because suppliers are group proposes to reduce the limit to offer forced to sell fuel with multiple exceptions to further protection to the end user. But at the new ISO 8217. Very recently, a major fuel what cost? Fuel suppliers will be forced to supplier highlighted a number of issues with source alternative blend stocks as many cycle the draft that, if implemented, would trigger oils are high in cat fines, leading to elevated rising bunker fuel costs for ship operators and levels especially in low sulphur grades. increase disputes over fuel specifications. Further reductions in Emission Control Area And the reason for our title? Well, we’re (ECA) sulphur limits, in addition to lower cat nearly there. Soon the questions posed in this fine limits, will inevitably result in a higher article will get answers – but most likely not fuel cost. before more questions have been raised!
bunkerspot February / March 2010 www.bunkerspot.com 51 Spotlight on Haiti Relief Effort Fuel aid
Multi Service reports on n 12 January, the southern portion of Haiti was struck by ‘More than a dozen marine the work going on behind Oa 7.0-magnitude earthquake. fuel orders were fulfilled This massive initial disaster has been the scenes to fuel the followed by more than 50 significant for the US Coast Guard aftershocks since, leaving much of the in Florida to support its ships bringing aid to Haiti nation’s capital city, Port-au-Prince, and the surrounding areas in rubble. evacuation and supply Among the ruins were the Presidential delivery efforts during the Palace, the United Nations (UN) peacekeeping headquarters, and the Hotel first three days of the relief Montana, a popular hotel for French tourists. effort alone’ The latest numbers from the Government of Haiti estimated 200,000 dead, 250,000 injured, and approximately two million purchasing cards were created specifically for displaced from their homes. the relief effort. The airport, which suffered considerable Aid encounters logistics issues damage in the earthquake, is currently On 13 January, Kenneth H. Merten, the US accommodating up to 140 flights a day, Ambassador to Haiti, declared the event a delivering food, water and medical equipment disaster and called on international resources to the country. As of 21 January, however, for aid. US President Barack Obama responded there were up to 1,400 planes waiting to The SEA Card programme by promising rescue and relief support to deliver their goods. The US Defense Energy Support Center (DESC), Haiti. According to the United States Early reports indicated that ships would a field activity for the Defense Logistics Agency Agency of International Development be unable to dock at the damaged Port- (DLA), provides fueling services to Department of (USAID), the US Government has dedicated au-Prince pier, which incurred significant Defense (DoD), federal civilian and government $130 million in aid thus far and has sent damage in the earthquake. Navy vessels agencies. In the wake of the Haiti disaster, both the approximately 12,000 military personnel to responding to the initial call for aid fuelled access to and convenience of obtaining necessary deliver aid and support evacuations. at nearby ports in Puerto Rico and the fuels for aviation and maritime support efforts In order to deliver on the President’s Dominican Republic. As a result, eight became a matter of clear necessity. promise of aid, support representatives from vessels were added to the SEA Card Open The mission of the DESC has expanded from the Multi Service, the exclusive contractor Market programme, allowing them to place administration of critical petroleum requirements to for the Defense Energy Support orders at ports where there are no DESC fuel providing the DoD and other government agencies Center (DESC) AIR Card and SEA Card contracts in place and ensuring that they too with comprehensive energy solutions. programmes, mobilised in support of DESC could deliver on President Obama’s promise Concurrently, a non-contract network of marine fuel Haiti disaster relief actions to ensure that of rescue and relief support. More than a merchants was being developed in order to expand US support aircrafts and vessels would have dozen marine fuel orders were fulfilled for US Government access to marine fuel around the access to the fuel required for completing the US Coast Guard (USCG) in Florida world, including those ports neighbouring Haiti in the their missions. to support its evacuation and supply delivery Dominican Republic, Puerto Rico and Florida. As part of providing services for AIR efforts during the first three days of the relief To help accomplish this objective, DESC piloted the Card and SEA Card, the Defense Logistics effort alone. AIR Card programme in 1997 and the SEA Card Agency (DLA) and the Government Fuel ‘In the face of such a challenging disaster, programme in 2004. The pilot programme of the Card programme, representatives at Multi it is reassuring to know that we have been SEA Card system was launched in October 2005 Service have established relationships with able to supply our government agencies and was later expanded to over 500 vessels. fuel suppliers at over 7,000 aviation locations with the logistical assistance they need to More information is available on the websites: www. and 3,000 marine locations worldwide for conduct their most important humanitarian airseacard.com and www.multiservicemarine.com. the supply of fuel on an ad-hoc basis for use efforts,’ said Ann Sielaty, DESC Government in situations such as relief efforts. Fuel Card Programme Management Office Tara Martinez, Manager of the AIR Card director. ‘Our hearts are with those in Haiti, Multi Service is the exclusive contractor of the DESC and SEA Card Support Teams, commented: and we continue our efforts to expand our AIR Card and SEA Card programmes. As such, ‘It has been inspiring to know that, in our fueling network so that the US Government Multi Service provides card issuance, transaction own little way, we’ve been able to provide can provide this type of aid wherever we are processing, programme support, as well as a range support to those suffering in Haiti.’ needed, for as long as we are needed.’ of other services to the AIR Card and SEA Card While telecommunication failures programme merchants and customers. resulting from the disaster delayed response to Aid results ongoing their calls, AIR Card personnel were able to On 23 January, the UN reported that Contact: confirm that the Port-au-Prince airport was international and US urban search and rescue Multi Service Corp. operational and capable of supplying aviation (USAR) teams had saved approximately 132 Tel: +1 913 451 2400 fuel to US aircraft by 14 January. To ensure people from the rubble. However, 21 January Fax: +1 913 217 9342 Web: www.multiservice.com the ability for these aircraft crews to procure had been reported as the first day since the aviation fuel and services, 20 new AIR Card initial earthquake that no successful rescues
52 www.bunkerspot.com February / March 2010 bunkerspot Spotlight on Haiti Relief Effort
were completed. Consequently, rescue crews the DoD were working to restore the pier, The world’s nations have pledged have refocused their efforts toward expanding cranes, and buildings around the port in the approximately $1 billion in emergency aid to the administration of aid to known survivors. hope that large ships may be able to dock and Haiti thus far. The USAID Disaster Assistance Response unload equipment in larger quantities in the Team has estimated that 500,000 people near future. in Haiti have received assistance, including food and water. More than 500 settlements have been developed around the capital, and on 24 January the UN Office for the Coordination of Humanitarian Affairs reported that the Government of Haiti had successfully organised the evacuation of 235,000 people. The US Department of Defense (DoD) continues to mitigate logistical and transport capacity at the Port-au-Prince airport and neighbouring locations in order to expedite the distribution of emergency relief commodities. As of 23 January, only four ships had been able to dock at the Port-au-Prince pier. As this article went to press, underwater construction teams with
Debt Collection Specialist supporting the Bunker Industry.
Tel: + 44 (0) 207 8681890 | Fax: + 44 (0) 207 8681800 4th Floor Lloyd’s Building, 12 Leadenhall Street, London, EC3V 1LP UK www.seadebt.com
bunkerspot February / March 2010 www.bunkerspot.com 53 Education and Training Bunkering by the
Llewellyn Bankes-Hughes t is often said that there is no substitute for on-the-job training, ‘Petrospot is now the looks at some of the Iespecially in areas such as bunkering leading publisher of operations, where practical, hands-on books now available to work is the norm. However, there are books aimed at raising many in the industry who may never the level of knowledge newcomers to the get their hands dirty on a bunker barge, oil terminal or receiving vessel but who, and education within the bunker industry nevertheless, still need to understand how bunker industry’ the industry works. This is where highly- focused books on different aspects of the bunker industry can – and do – help. more finely-focused books that cover highly- While training courses – such as the specific areas of the bunker industry. well-established Oxford Bunker Course in the UK and BunkerExperience in the An Introduction to Bunkering Netherlands – are considered by enlightened In May 2008, Petrospot
companies to be vital for bringing new staff published the first Edición española up to speed with many of the issues that they of a series of books are likely to encounter while working in by Nigel Draffin, or on the periphery of the bunker industry, An Introduction to
there is now also a growing appreciation of Bunkering. Although GUÍA DE the educational value of well-written books obviously from the ABASTECIMIENTO DEL COMBUSTIBLE on specific areas of the business. same design ‘stable’ MARINO Books, by their nature, are designed to last. as Bunkers, this Long after the lessons learned on a training book provides a course have begun to fade from memory, handy entry-level the information contained in a book stays introduction to the forever. The beauty of the book is that it can bunker industry, Nigel Draffi n be referred to as many times as necessary, offering newcomers and can be read anywhere and at any time. bite-sized pieces of key informationnformation And it can be passed from one reader to the in a format ‘packed with useful and relevant next. Those books with extensive indices, data, practical illustrations and enough glossaries and multiple language lexicons pictures to help anyone understand exactly are particularly helpful because they provide what bunkering is all about’. In just over a constant reference and allow facts to be 100 pages, the book provides just enough checked and re-checked as often as required. material to maintain the reader’s interest and Petrospot is now the leading publisher of ensure that the book is read right through books aimed at raising the level of knowledge rather than just left on a shelf until required. and education within the bunker industry. A Spanish language version of the book, entitled Guía de Abastecimiento del Bunkers CCombustible Marino, was also published in In 2004, Petrospot 2008,20 complete with an English-Spanish/ published Bunkers: Spanish-EnglishSp glossary of key bunkering An Analysis of the teterms. Practical, Technical and Legal Issues, by AnA Introduction to Fuel Analysis Chris Fisher and In his third book, An Jonathan Lux. Hailed InIntroduction to Fuel as the ‘bible’ of the AAnalysis, published industry, this book in June 2009, Nigel set down an industry DDraffin tapped into marker against a growing thirst which all subsequent fofor information on books have been bubunker quality issues. judged. Billed as ‘the worldworld’s’s most TThis book provides a Contact: authoritative book on marine fuels’, the 400- guide and reference Petrospot Ltd page volume has become a best-seller and is for those who need Tel: +44 1295 814455 found on bookshelves and desks around the to understand the Fax: +44 1295 814466 world. However, comprehensive as Bunkers terminology and Nigel Draffi n Email: [email protected] may be, Petrospot recognised that there is the reporting used Web: www.petrospot.com/books also a market and strong demand for shorter, in fuel analysis. It is notot
54 www.bunkerspot.com February / March 2010 bunkerspot Education and Training book
aimed at the specialist chemists and bunker for making credit decisions and assessing surveyors whose jobs involve technical counterparty risk when buying or selling ‘Books with extensive analysis, but at those who need to find their marine fuels. This can be a highly complex way around fuel specifications and to know area of the industry, particularly in terms of indices, glossaries why they are important. This book is intended interpreting financial information, but Adam and multiple language to help anyone who has any doubts about Dupré presents the subject in a simply- what can be found in marine fuels and, once written and highly-effective format that lexicons are particularly found, what can be done about it. It contains provides readers with a solid foundation in helpful because they a six-language glossary of words associated all aspects of credit management. provide a constant with fuel analysis, designed to help readers whose native tongue may be French, Spanish, Legal Issues in Bunkering reference and allow Portuguese, German, Russian or English. So This year will also facts to be checked and far it has proved exceptionally popular. see the publication of a book by barrister re-checked as often An Introduction to Bunker Operations and legal consultant as required’ Bunkering operations Trevor Harrison. Legal can be highly IsIssues in Bunkering:
complex and riddled AAn Introduction to An Introduction to the Law Relating to with regulation, but ththe Law Relating to the Sale and Use of Marine Fuels in his next book, ththe Sale and Use of An Introduction to MMarine Fuels will Bunker Operations, ooffer a wealth of to be published in iinformationn on the
May 2010, Nigel kekey legal aspects of Trevor Harrison Draffin provides bubunkering, including a comprehensive ccontacts,o defaults, overview of bunker sshiph arrest and dispute resolution. It will operations. In it, he iincluden a section dealing with international Nigel Draf examines each of fin cconventionso and national legislation on the key elements enenvironmental issues relevant to bunkering. involved, from orderingg the right type TThe aim of the book is to provide an and amount of fuel, to making sure it is safely overview of legal issues in no more than delivered and properly accounted for. He around 100-pages to offer the reader an covers the paperwork that needs to be done easily-accessible ready reference. It is not and looks at the various regulations now in intended as a substitute for professional help place, including MARPOL Annex VI and the or to heavy leather-bound legal tomes on International Ship and Port Facility Security shipping law, but it will certainly help guide (ISPS) Code. The book includes a vast the reader to relevant laws and point him in amount of informed detail on some of those the right direction should professional help areas that are often ignored – sometimes to be required. great cost and inconvenience – such as Several more titles are planned over the variations in flange and hose sizes. As with next year or so, covering subjects as diverse his earlier books, Nigel Draffin has included as bunker price risk management, bunker extensive indices and appendices, as well as a metering and commercial issues. very useful ‘where to go for help’ section.
An Introduction to Bunker Credit Risk During the course of For more information 2010, several more bunker-related books on any of the book titles will be published by published by Petrospot, Petrospot. Among these will be An Introduction to please visit Bunker Credit www.petrospot.com/books Risk, by Adam Dupré, Managing Director of Ocean Intelligence. The book is aimed at Adam Dupré those responsible
bunkerspot February / March 2010 www.bunkerspot.com 55 Events
Contact: Luke Hallam Evans a range of key issues, including the latest Tel: +44 1295 814455 revisions to ISO 8217, exotic contaminants in Events Diary Fax: +44 1295 814466 fuels, and bunker metering. Petrospot will also Email: [email protected] present two seminars on port and maritime Web: www.aracon2010.com security on these dates. FEBRUARY UNITED STATES: CMA Shipping 2010 Contact: Sarah Morris (Asia Representative) UNITED KINGDOM: The IBIA Dinner 2010 22-24 March, Stamford, Connecticut Tel: +65 8168 6976 Fax: +44 1295 814466 15 February, London The 25th annual Shipping Conference Email: [email protected] The 16th annual International Bunker Industry and Exhibition organised on behalf of the Association Dinner takes place at the Hilton Connecticut Maritime Association at the Hilton Web: www.petrospot.com/singapore Hotel on Park Lane, London. Hotel, Stamford. Contact: Anne Chambers Contact: Lorraine Parsons MAY Tel: +44 2380 226 555 Tel: +1 203 406 0109 Fax: +44 2380 221 777 Fax: +1 203 406 0110 UNITED KINGDOM: The Oxford Bunker Email: [email protected] Email: [email protected] Course Web: www.ibia.net Web: www.shipping2010.com 10-14 May, Oxford MAURITIUS: 4th Indian Ocean Ports and The Oxford Bunker Course, organised by MARCH Logistics 2010 Petrospot, is a hugely popular five-day intensive residential bunker course covering technical, HUNGARY: European Oil Storage 25-26 March, Mauritius operational, commercial, financial and legal Contact: Transport Events Management Ltd 1-2 March, Budapest aspects of bunkering. Course Director Angus Tel: +60 87 426 022 Contact: Stacey Knox Ogilvie and Technical Director Nigel Draffin Fax: +60 87 426 223 Tel: +44 20 7176 6226 lead a team of expert lecturers. The course is Email: [email protected] Email: [email protected] Web: www.transportevents.com designed for newcomers to the business and for Web: www.events.platts.com those who may already have some experience. GREECE: The Piraeus Bunker Course Case studies, lectures, practical exercises APRIL 3-4 March, Piraeus and comprehensive course literature for future reference provide a thorough background to The third annual Piraeus Bunker Course takes UNITED ARAB EMIRATES: Petrospot Bunker the industry. This course is renowned for its place at the Piraeus Theoxenia Hotel. The Seminars two-day event offers a highly practical training 26 April, Dubai networking activities. programme on the technical, operational, The Case for Bunker Metering seminar comes Contact: Luke Hallam Evans commercial and legal aspects of bunkering, to the Middle East for the first time, following Tel: +44 1295 814455 covering bunker quality, delivery procedures, highly successful events in Antwerp, Miami and Fax: +44 1295 814466 sampling, ship and barge operations, credit, Singapore. Featuring the main manufacturers Email: [email protected] financial and legal issues. It includes a and leading proponents of bunker metering, Web: www.petrospot.com/oxford bunkering tour of the port of Piraeus. The including A.P. Moller Maersk and Buffalo course is organised by Petrospot and led by Marine Service, the seminar will investigate UNITED STATES: Maritime Week Americas Chris Fisher, Chairman of the International 2010 Bunker Industry Association (IBIA). the persistent problem of short deliveries and accurate measurement and look into how these 17-21 May, Miami Beach, Florida Contact: Luke Hallam Evans might be resolved through the development and The third annual Maritime Week Americas Tel: +44 1295 814455 deployment of sophisticated in-line measuring (MWA) takes place at the luxurious Ritz- Fax: +44 1295 814466 and on-line monitoring equipment. The seminar Email: [email protected] will include detailed case studies and lively Carlton Hotel on South Beach, Miami. Now Web: www.petrospot.com/piraeus debate. a major event on the international bunkering calendar, MWA offers an outstanding and varied UNITED ARAB EMIRATES: The UAE in the Contact: Luke Hallam Evans programme, including seminars and courses 21st Century Tel: +44 1295 814455 on the specialised subjects of credit and 1-3 March, Abu Dhabi Fax: +44 1295 814466 Email: [email protected] counterparty risk, bunker metering, bunkering This summit, Environmental Vigilance: Taking Web: www.petrospot.com/dubai operations and port and port hinterland the Lead in Envornmnetal Protection, is security. The centre-piece is a two-day bunker organised by the National Transport Authority of SWEDEN: 31st International Bunker conference that brings together bunkering and the United Arab Emirates in collaboration with Conference shipping executives from every part of the the North American Environment Protection Association (NAMEPA). 28-30 April, Stockholm Americas and beyond. Contact: Capt Salleem Alavi The longest-running bunkering event in Contact: Elena Melis Tel: +971 2418 2199 Europe, organised by BI Norwegian School of Tel: +44 1295 814455 Email: [email protected] Management. Fax: +44 1295 814466 Contact: Hilde Sparen Email: [email protected] NETHERLANDS: ARACON 2010 Tel: +47 4641 0217 Web: www.maritimeweekamericas.com 17-19 March, Rotterdam Email: [email protected] Web: www.bi.no ARACON 2010, the largest bunkering event JUNE in the Amsterdam-Rotterdam-Antwerp (ARA) SINGAPORE: Petrospot Bunker Seminars region, takes place onboard the iconic 1950s GREECE: Posidonia 2010 29-30 April, Singapore ocean liner SS Rotterdam. A full programme 7-11 June, Athens Greece covering key economic, financial, commercial, The Managing Credit Risk seminar will bring technical, operational and environmental the world’s leading experts in bunker credit and Contact: Posidonia Exhibitions SA issues will be complemented by an optional counterparty risk to Singapore to provide their Tel: +30 210 428 3608 workshop on bunker metering. ARACON 2010 is unique insight and advice to those exposed Fax: +30 210 428 3610 organised by Bunker Events Ltd, a joint venture to risk. The second seminar, Bunkering Email: [email protected] between Petrospot and Vergo Consultancy. Operations: Quality and Quantity, will cover Web: www.posidonia-events.com
56 www.bunkerspot.com February / March 2010 bunkerspot Events
JULY and legal aspects of bunkering. Designed for NOVEMBER newcomers to the business and for those who GHANA: Oil & Shipping Africa 2010 may already have some experience, it is widely BELGIUM: The Bunkering Symposium 14-16 July, Accra acknowledged as the best bunker course in the 17-19 November, Antwerp Following the success of the inaugural event world. Now established as the major year-end event in July 2009, Petrospot will present the second Contact: Luke Hallam Evans for the European market, the third annual annual Oil & Shipping Africa conference and Tel: +44 1295 814455 Bunkering Symposium will again be held in training course at the Labadi Beach Hotel in Fax: +44 1295 814466 Antwerp. Organised by Bunker Events Ltd, a July. This event attracts many local Ghanaian, Email: [email protected] joint venture between Petrospot and Vergo Nigerian and other West African delegates, who Web: www.petrospot.com/oxford Consultancy, this unique three day event is come to learn and to meet foreign counterparts. focused on high-level discussion and debate It also attracts many foreign companies wanting UNITED STATES: IBIA Annual Convention and includes some spectacular networking. to learn about bunkering opportunities in this 2010 Contact: Elena Melis part of Africa and to meet local suppliers and 20-25 September Stamford, Connecticut Tel: +44 1295 814455 shipping companies. Oil & Shipping Africa Fax: +44 1295 814466 Contact: Anne Chambers 2010 will cover a range of key issues in the oil, Email: [email protected] Tel: +44 2380 226 555 bunkering and shipping industries, including Web: www.bunkeringsymposium.com making a case for the introduction of a West Fax: +44 2380 221 777 African bunkering protocol. Email: [email protected] Web: www.ibia.net Contact: Osei Mitchell Tel: +44 1295 814455 Fax: +44 1295 814466 OCTOBER Email: [email protected] Web: www.petrospot.com/africa SINGAPORE: SIBCON 2010 27-29 October, Singapore To list details of bunker-related SEPTEMBER The 16th Singapore International Bunkering events and conferences, Conference (SIBCON), organised on behalf of please contact: UNITED KINGDOM: The Oxford Bunker the Maritime & Port Authority of Singapore, is Course the world’s biggest bunkering event. 13-17 September, Oxford Contact: Sukumar Verma Tel: +44 1295 814455 The Oxford Bunker Course is a highly intensive Tel: +65 6835 5130 Fax: +44 1295 814466 five-day residential training course covering Email: [email protected] Email: [email protected] technical, operational, commercial, financial Web: www.sibconsingapore.com
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bunkerspot February / March 2010 www.bunkerspot.com 57 Networking
Det Norske Veritas Petroleum Services Bud Streeter has been appointed as Lloyd’s On the move... (DNVPS) has appointed Bill Stamatopoulos as Register’s new VP and Marine Manager for Regional Manager (Rotterdam), replacing Ferry the United States. Europe van Eykel. Based in Piraeus, Stamatopoulos continues to be responsible for DNVPS sales Asia Pacific Capt. Fritz Jakob Fredriksen, formerly of Höegh and marketing in Greece, Cyprus, Bulgaria Autoliners AS and a previous Chairman of the and Croatia, in addition to his new regional David Chan has joined OW Bunker in Hong International Bunker Industry Association, has role. Tel: +30 211 000 3143; Mob: +30 697 Kong as a bunker trader. Tel: +852 2866 6254; been appointed Senior Manager at the WWF 269 8023; Email: Bill.Stamatopoulos@dnv. Direct: +852 2866 6247; Mob: +852 9055 – Norway. Tel: +47 2203 6500; Mob: +47 4003 com. 9044; Fax: +852 2866 9590; Email: dach@ 9787; Email: [email protected]. owbunker.com.hk. Ann van Gils has joined the bunker department Lars Robert Pedersen, Director of Regulatory of Total Marine Fuels in Antwerp, Belgium, Bunkers Manila Inc. has moved to 26/F Fort Affairs in Maersk Maritime Technology at the replacing Peter Spuijman who has taken on Legend Tower, 3rd Avenue (corner 31st Street), A. P. Moller-Maersk Group in Copenhagen, a refining role within the company. Tel: +32 2 Fort Bonifacio, Taguig City, Philippines. Tel: has been appointed Deputy Secretary General 288 331; Email: [email protected]. +632 403 4024; Fax: +632 403 4023; Email: of the Baltic & International Maritime Council [email protected]. (BIMCO). Tel: +45 4436 6800; Fax: +45 4436 Naiara Calvo has left OW Bunker in Madrid, 6868. Spain. Tel: +34 91 298 62 39; Email: madrid@ André Máximo is now in charge of Petrobras’ owbunker.es. bunker business in Singapore, replacing Viktoriya Fedulova has joined A/S Dan- Marco Tritto who has returned to Petrobras Bunkering in Middelfart, Denmark as a bunker Nicolas Esposito, formerly of Maersk Oil headquarters in Brazil. Tel: +65 6550 9085; trader to focus on Russia and work with the Trading, has joined OW Bunker’s trading team Mob: +65 9757 8881; Email: andre.maximo@ company’s Kaliningrad office. Tel: +45 6441 in Piraeus. Tel: +30 210 428 4455; Direct: +30 petrobras.com.br. 5401; Direct: +45 6421 5430; Mob: +45 6082 210 452 9467; Mob: +30 693 695 8499; Fax: 3456; Fax +45 6441 5301; Email: vif@dan- +30 210 428 4459; Email: nies@owbunker. Kasper Kristensen has been appointed bunkering.dk. com. Financial Manager for OW Bunker Asia in Singapore. Tel: +65 6317 0000; Direct: +65 Louise Hald Bødtker has joined A/S Mideast and Africa 6317 0017; Mob: +65 9677 4143; Email: Dan-Bunkering Ltd as a bunker trader in [email protected]. Copenhagen. Tel: +45 3345 5410; Fax +45 GAC Bunker Fuels Co Ltd BVI has appointed Kelvin Yeo has been appointed Managing 3345 5411. Direct: +45 3345 5442; Mob: +45 Colin Holloway as the new Regional Manager Director of KPI Bridge Oil Singapore. Tel: +65 2242 8994; Fax +45 3345 5411; Email: lhb@ for Middle East & Indian Subcontinent. Colin, 6220 8655; Mob: +65 9690 0888; Fax: +65 dan-bunkering.dk. formerly of DNV Petroleum Services Fujairah, 6220 8155; Email: [email protected]. will be located in GAC’s United Arab Emirates Christian Vandvig Finnerup has also joined sg. office in Sharjah, Tel: +971 6 572 5129; Fax: A/S Dan-Bunkering Ltd as a bunker trader. +971 6 572 5175; Email: colin.holloway@ Direct tel: +45 3345 5447; Mob: +45 2365 Bunkers International (S) Pte Ltd has relocated gacworld.com. 5548; Email: [email protected]. to 171 Tras Street, #05-173 Union Building, Singapore 079025 and appointed Roger Wong Thomas Tampi, Technical Advisor, has taken Lars Rye Helmer has joined Global Risk as a bunker trader. Tel: +65 6325 0861; Fax: over Colin Holloway’s responsibilities at DNV Management in Middelfart, Denmark as an +65 6325 0865; Mob: +65 9817 6276; Email: Petroleum Services in Fujairah. Tel: +971 accountant. Tel: +45 8838 0016; Fax: +45 8838 [email protected]. 9 222 8152; Fax: +971 9 222 8153; Email: 0009; Email: lrh@global-riskmanagement. [email protected]. com. To list details of bunker-related Praxis Energy Agents has opened an office Americas appointments, please contact: at Caffamacherreihe 7, Hamburg 20355, Germany and appointed George Diakoumakos Organización Terpel S.A. has appointed as General Manager. Tel: +49 40 669 9960; Luis Alberto Goldoni Fonseca as Manager of Tel: +44 1295 814455 Mob: +49 175 931 5011; Fax: +49 40 669 996 Aviation, Marine and Industry for its operations Fax: +44 1295 814466 199; Email: Hamburg@praxisenergyagents. in Panama. Tel: +507 301 8777; Email: luis. Email: [email protected] com. [email protected]
58 www.bunkerspot.com February / March 2010 bunkerspot