).$%0%.$%.4).4%,,)'%.#%&/24(%',/"!,"5.+%2).$53429 www.bunkerspot.com Volume 5 Number 1 February / March 2008 TRIBUTE TO BOB CHANDRAN: Industry mourns Chemoil founder s3ULPHUR%MISSIONS s0ORT3ECURITY s(ARNESSING7IND0OWER s'AS 4O "UNKERS s"UNKERINGIN4URKEY s0EOPLEAND0LACES s.EWSAND%VENTS Contents NEWS Bunker Markets and Prices 4 Europe 8 Head Office: Americas 12 Petrospot Limited Petrospot House Sommerville Court Asia Pacific 14 Trinity Way Adderbury Africa and Mideast 16 Oxfordshire OX17 3SN England Tel: +44 1295 81 44 55 TRIBUTE TO BOB CHANDRAN Fax: +44 1295 81 44 66 Email: [email protected] Llewellyn Bankes-Hughes commemorates the inspirational life of the late Bob Chandran, Website: www.bunkerspot.com CEO of Chemoil Energy 18 Publishing Manager / Editor Ian Taylor Adrian Tolson reflects on Bob Chandran’s philosophies which have underpinned Tel: +44 1295 81 44 55 Mobile: +44 7876 70 45 41 Chemoil’s development 21 Email: [email protected] Paul Stebbins, CEO of World Fuel Services, pays tribute to a worth adversary 23 Publisher Llewellyn Bankes-Hughes Tel: +44 1295 81 44 55 Mobile: +44 7768 57 44 30 OPERATIONAL ISSUES Email: [email protected] Tom Marian of Buffalo Marine reports on how the introduction of the Transportation Associate Editor Workers Identification Credential is affecting bunker barging activities in US ports 24 Lesley Bankes-Hughes Tel: +44 1295 81 44 55 Email: [email protected] BUNKERSPOT WORLD MAP Reporter David Waterman Global prices and news at a glance 26 Tel: +44 1295 81 44 55 Email: [email protected] COMPANY PROFILE Advertising and Sales Ian Taylor Lesley Bankes-Hughes takes a closer look at Aegean Marine Petroleum’s ambitious vessel Tel: +44 1295 81 44 55 Email: [email protected] acquisition strategy ahead of the phase-out of single-hulled vessels, and she assesses its vision for global business growth 28 Events Manager Luci Llewellyn-Jones Tel: +44 1295 81 44 55 Mobile: +44 7775 92 42 24 COUNTRY PROFILE Email: [email protected] David Waterman looks at the key players and supply centres in the Turkish bunker market 34 Events and Marketing Executive Alison Parsons Tel: +44 1295 81 44 55 ENVIRONMENTAL ISSUES Email: [email protected] Stephan Wrage of SkySails argues that the christening of the Beluga SkySails marked a key Subscriptions and Events Sales Manager Luke Hallam Evans milestone in the use of sustainable propulsion technologies for the shipping industry 38 Tel: +44 1295 81 44 55 Mob: +44 7815 86 73 52 Lars Robert Pedersen of A.P.Moller-Maersk looks at the operational and regulatory issues Email: [email protected] resulting from the requirement to use low sulphur distillate fuels 42 Accounts Miles Walsh Mark Servidio of Sharp Electronics and Buddy Polovick of the US Environmental Tel: +44 1295 81 44 55 Protection Agency extol the virtues for freight shippers and carriers of signing up to Email: [email protected] the US SmartWay Transport Program 44 Cover Photo: Courtesy of Llewellyn Bankes-Hughes ALTERNATIVE FUELS David Waterman looks at the potential of Gas-to-Liquids as an alternative fuel for the shipping industry 46 EVENTS Events and training course diary 48 NETWORKING Bunker people on the move 50 Bunkerspot is an integrated news and intelligence service for the international bunker industry. The bi-monthly magazine and 24/7 electronic news service, www.bunkerspot.com, both provide highly-specific information on all aspects of the marine fuels industry. Bunkerspot Magazine (published in February, April, June, August, October and December) annual subscription rate, including unlimited access to the website www.bunkerspot.com, is $430 / £225 / %315. ISSN 1741-6981. Copyright Petrospot Limited © 2008. 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 www.bunkerspot.com industries. 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 A one-year subscription is only of the information contained in Bunkerspot. Nor does Petrospot accept responsibility for errors or omissions or their consequences. £225/$430 for both the magazine No part of Bunkerspot may be reproduced, stored in a retrieval system or transmitted in any form or by any means electronic, mechanical, and unlimited website access photographic, recorded or otherwise, without the prior written permission of the publisher. Designed by Matthew Stuart. bunkerspot February / March 2008 www.bunkerspot.com 3 Bunker Markets & Prices MONTHROLLINGPRICECHARTS #34&UEL/IL 600 Houston 380 Singapore 380 500 Fujairah 380 400 Rotterdam 380 PRICE $/tonne 300 200 FMAMJJASONDJ -ARINE$IESEL/IL 1000 Houston MDO Singapore MDO 800 Fujairah MDO Rotterdam MDO PRICE $/tonne 600 400 FMAMJJASONDJ 0OWERINGSHIPSAFTERTHEPEAKOILPOINT Bunker prices in most of the world’s key order to satisfy growing demand. of gas and coal (see article on page 46), but ports rose steadily through December until The International Energy Agency (IEA) last the technology required to do so is complex peaking around the New Year, and then eased year predicted that oil production would peak and expensive. According to the International off thereafter. At the end of January, 380 in just five years from now, when it expects a Maritime Organization (IMO), the annual centistokes (cst) fuel oil prices in Rotterdam plateau. With this worrying prediction in mind, a consumption of bunkers is set to grow from were actually lower than they were at the start suitable alternative energy source for transport 369 million tonnes today, to 446 million tonnes of December, dipping below $430 a metric needs to be found – and quickly. It is all very well in 2020. By this time, we may have an annual tonne (mt), while marine diesel oil almost promoting electric power and greater efficiency production of 50 million tonnes of liquid coal came down to its original price over the same for the purposes of automotive transport, but and gas – most of which is likely to be period. in the world of international shipping, only a absorbed by the automotive markets because Although production costs of crude are said fuel that can be used in commercial vessels’ of its superior qualities. to be twice what they were ten years ago, this compression ignition engines will provide an The only viable alternative to bunkers in alone is not responsible for the prices we are alternative source of energy in the near future. the foreseeable future seems to be biodiesel, experiencing today. Whether the recent pattern Furthermore, commercial shipping is already a which could be used in the compression in the price of oil is related to the rumoured highly efficient mode of transport. ignition engines of all commercial vessels. Fuel recession in the United States, or whether it is Leaving environmental considerations aside, oil engines may also be able to use unrefined due to perceptions of geo-political tensions, is any replacement for bunker fuel would have biodiesel, reducing the fuel’s production costs, unclear. What is certain, however, is that there to be readily available. There is potential in but research needs to be done into the subject. is a limit to how much oil can be produced in producing liquid fuels from abundant reserves Biodiesel has recently traded in the $800-$900 4 www.bunkerspot.com February / March 2008 bunkerspot Bunker Markets & Prices a tonne range, putting it in the same price Dec-07 Jan-08 bracket as marine gasoil (MGO). Being virtually 380 IFO 3-7 10-14 17-21 24-28 31-4 7-11 14-18 21-25 28-1 free of sulphur, this would also provide a cost-effective alternative to the low-sulphur Rotterdam d 435 438 452 453 472 462 437 421 436 Gibraltar d 466 471 473 464 482 477 453 443 460 distillate used in areas such as European Piraeus d 447 452 456 440 463 458 434 428 442 Union (EU) ports. There are, however, barriers to biodiesel’s entry to the bunker market. If Suez d 476 480 486 472 492 493 481 460 474 Fujairah d 484 464 474 475 498 497 474 449 473 biodiesel is to be used in a marine application, Durban w n/a n/a n/a n/a n/a n/a n/a n/a n/a industry regulators need to carry out tests to develop standards for the fuel, and new Tokyo d 503 498 505 508 517 523 518 499 526 Busan d 493 493 498 521 542 525 487 458 481 settings for the engines that will be using it. Hong Kong d 476 481 491 494 508 512 479 465 480 The latter requirement is particularly important Singapore d 466 469 483 485 494 487 465 449 463 in order to counter the increased nitrous oxide (NOx) emissions from biodiesel. But as far as Los Angeles w 528 543 501 492 505 501 469 436 450 Houston w 466 450 462 457 471 475 462 441 450 we are aware, no such action has been initiated New York w 473 479 488 488 493 493 473 455 455 from the relevant organisations. Since biodiesel is likely to go to automotive Panama w 457 477 483 483 489 493 473 462 469 Santos d 457 458 474 473 473 479 463 445 454 markets first (where several governments Buenos Aires d n/a n/a n/a n/a n/a n/a n/a n/a n/a have placed mandates on the blending of the fuel with petroleum diesel), production may have to increase dramatically before biodiesel becomes available to the bunkering industry.