ARACON COMES TO ROTTERDAM: Blue sky thinking for bunkers€¦ · Americas 16 Asia Pacific 20 Africa...

Inside:• Ports of the Future• LNG Bunkering• Bunker Sampling• Conference Update• Commercial Issues• People and Places• News and Events

INDEPENDENT INTELLIGENCE FOR THE GLOBAL BUNKER INDUSTRY

ARACON COMES TO ROTTERDAM:Blue sky thinking for bunkers

www.bunkerspot.com Volume 8 Number 4 August / September 2011

bunkerspot August / September 2011 www.bunkerspot.com 3

FEATURES

MARKET OUTLOOKStefka Ilieva of Poten & Partners asks if the United States and Canada are prepared for the imminent introduction of a North American ECA 26

BUNKERSPOT WORLD MAPGlobal prices and news at a glance 30

COMMERCIAL ISSUESChris Thorpe of HCEnergy finds that the markets are moving towards a ‘new normal’ 32

Félix Yamasato of Lloyd’s List Intelligence asks at what point will auditors force owners to write-down the book value of vessels 34

Chemoil’s Peter Grunwaldt talks to Bunkerspot about the company’s recent financial results and future prospects 36

ENVIRONMENTAL ISSUESSøren Christian Meyer argues that preparation, not procrastination, is the best way to deal with the impact of ECAs 38

Pierre C. Sames of Germanischer Lloyd presents the zero emission container feeder vessel 40

LNG BUNKERING Andrea Cogliolo of RINA tells Bunkerspot how operators can ensure that gas fuelled ships are safe 43

BUNKER SAMPLINGChris Leigh-Jones of Kittiwake looks at why it is so important to cut through the noise on sampling and monitoring 45

FUTURE PORTSBunkerspot talks to Ismo Matinlauri about Cargotec’s Port2060 48

BUNKER PEOPLEAhead of the annual WISTA conference in Stockholm, GAC’s Resham Rai, Thana’a Abdelkarim, Azeneth Bahian and Loh Mei Lian share their perspectives on the changing face of the shipping and bunker industries 50

EVENTSWISTA Sweden explains what’s in store for attendees at the forthcoming WISTA International Conference and AGM in Stockholm 52

Llewellyn Bankes-Hughes looks at some exciting bunkering events on the horizon 53

Nigel Draffin of LQM Petroleum Services and IBIA reports back on the Istanbul Bunker Conference 54

NETWORKINGBunker people on the move 58

Contents

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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 UK£250/€280/US$400. ISSN 1741-6981. Copyright Petrospot Limited © 2011. 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. 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. No part of Bunkerspot may be reproduced, stored in a retrieval system or transmitted in any form or by any means electronic, mechanical, photographic, recorded or otherwise, without the prior written permission of the publisher. Visit www.petrospot.com

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EVENTS & SUBSCRIPTIONS SALES Elena Melis +44 7975 89 52 03 [email protected] Mitchell +44 7789 20 20 10 [email protected] Leader +44 7771 54 03 82 [email protected]

ACCOUNTSHelen Wilkins [email protected]

NORTH AMERICA REPRESENTATIVEJackie Hoo Bryant (Miami, United States) +1 305 456 1838 +1 786 302 7667 [email protected]

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MAGAZINE LAYOUT & PRODUCTIONAlison Design and Marketing Ltd [email protected] www.alison.co.uk

NEWS Bunker Overview 4Europe 8Americas 16Asia Pacific 20 Africa and Mideast 24

August / September 2011 bunkerspotwww.bunkerspot.com4

Bunker Overview

Mounting debts and slow growth take their toll on market confidenceCrude oil and bunker prices were on a steady but unspectacular upward curve in July. There was a surge in the oil markets at the start of August, which pundits described as a ‘relief rally’ sparked by the news that US President Barack Obama had unveiled a minute-to-midnight deal to raise the ceiling on the US debt limit.

Some were expecting the good news about the US debt agreement to give players on the oil markets more confidence to take risks – and thereby nudge up the prices some more. However, this is not going to bring much long term respite for the global economy.

Across the Atlantic, the ‘Eurozone crisis’ shows no signs of dissipating. The countries which face the biggest problems – Portugal, Italy, Greece and Spain – are often penned together with the unflattering acronym PIGS.

There have been some apocalyptic headlines in the press – the Daily Telegraph’s ‘America is merely wounded, Europe risks death’ was a good example of the trend – but wheels on the Eurowagon haven’t come off yet, even though the tyres may be punctured.

12 month rolling price charts

At the end of July, the European Union (EU) agreed a $159 billion bail-out for Greece. However, Germany’s Finance Minister Wolfgang Schaeuble stressed that this was a one-off.

‘In the future,’ said Schaeuble, ‘such purchases must only take place under very tight conditions, when the European Central Bank establishes that there are extraordinary circumstances in financial markets and dangers to financial stability.’

This was taken as a strong signal that Germany and the bankers will not be prepared to support every faltering Eurozone country in order to prop up the currency.

In truth, they may not have much choice. Europe’s economies are so intertwined that they have to hang together. As anyone who works in the shipping or bunker industries will know, this is particularly true in the case of Greece. The Greek diaspora has been the engine of Europe’s shipping and trading networks for millennia.

Aside from all the hand-wringing about the debt crisis, a major worry for businesses

across the board has been the slow-down in economic growth.

In the United States, the Commerce Department reported at the start of August that personal spending had decreased for the first time since September 2009. It was a similar sorry tale in the UK, where the Markit/Chartered Institute of Purchasing Supply (CIPS) manufacturing purchasing managers’ index (PMI) fell to 49.1 in July for the first time since May 2009. A PMI rating of below 50 represents a contraction – and the Markit/CIPS report also noted the most significant number of job losses in the manufacturing sector since 2010.

This will rattle the UK government as the Chancellor of the Exchequer, George Osborne, had claimed that the pick-up in the manufacturing sector – trumpeted as the ‘march of the makers’ – would offer opportunities for those who would have to leave the contracting public sector. ‘With austerity arriving at home and debt ills rising in the US and euro area,’ warned the Markit/CIPS report, ‘significant headwinds are on the horizon’.

400

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Bunker Overview

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ANUNCI TRAZ.pdf 1 03/03/11 12:09

Even China’s growth appears to be losing some of its galloping momentum. The country’s official PMI fell by two-tenths to 50.7 in July. So it is still above the all-important 50 mark, and analysts are predicting that the country remains on track for a 9% growth rate this year – but China is not quite the super-charged steamroller that it was a few years ago.

The feeling that we might be slipping back into the trough of two years ago was also evident in the shipping sector. As we report on page 14, a new survey from Moore Stephens found that in May 2011, the average confidence level expressed by respondents in the markets in which they operate was 5.6 on a scale of 1 (low) to 10 (high), compared to 5.8 in the previous survey in February 2011. This is the lowest figure recorded since May 2009, when confidence stood at 5.5.

With shipping companies tightening their belts, the second quarter (Q2) of 2011 was also a tough time for many of the big-name bunker players.

The share price of Aegean Marine Petroleum Network Inc. (AMPNI) has taken a beating over the past 12 months, falling from a high of $28 a share to below $6 (see page 8).

Chemoil Energy turned in a strong Q1 with a pre-tax profit of $31.5 million, but then dipped to $4.7 million in Q2. On page 36 of this issue of Bunkerspot, Chemoil’s new Director of Sales, Peter Grunwaldt, argues that given the current economic landscape this was actually a favourable result. ‘Everybody knew that Q2 was going to be more difficult than Q1,’ says Grunwaldt. ‘Volumes are steady for us, and not everybody has been making money in a very difficult term, so in many ways we take confidence from the first half of 2011.’

While Grunwaldt believes that the inherent ‘strength’ of the Chemoil group would make it ‘better equipped than most to weather the storm’, he adds: ‘I just can’t see how some shipping companies can continue to exist with high costs and low income. I hope it will not happen, but it would be a surprise if it doesn’t.’

Writing on page 34, Félix Yamasato of Lloyd’s List Intelligence (LLI) warns that the recent Chapter 11 filing of Omega Navigation Enterprises Inc. may be ‘an indication of what’s to come’. To echo Grunwaldt, let’s hope it isn’t; but don’t be surprised if it is.

380 IFO June July30-03 06-10 13-17 20-24 27-01 04-08 11-15 18-22 25-29

Rotterdam d 626 637 639 625 616 632 650 657 662Gibraltar d 644 659 657 640 634 655 672 677 682Piraeus d 643 653 656 635 620 648 668 670 675

Suez d 707 697 705 701 699 697 701 699 695Fujairah d 657 665 659 646 638 656 671 682 696Durban w n/a n/a n/a n/a n/a n/a n/a n/a n/a

Tokyo d 685 702 702 698 701 699 707 707 708Busan d 685 687 694 683 666 670 685 679 696Hong Kong d 660 670 668 651 645 658 672 680 681Singapore d 646 660 652 643 638 655 668 671 677

Los Angeles w 645 662 666 656 646 674 699 694 697Houston w 639 667 657 631 622 648 657 659 662New York w 659 683 682 648 646 659 669 670 678

Panama w 659 680 685 663 653 663 671 672 675Santos d 656 673 673 645 659 702 700 704 709Buenos Aires d 690 681 668 672 671 669 671 671 675

180 IFO June July30-03 06-10 13-17 20-24 27-01 04-08 11-15 18-22 25-29


Suez d 746 712 736 723 718 719 733 735 729Fujairah d 681 694 686 685 672 687 703 711 723Durban w 691 698 708 691 685 702 703 693 687




MDO June July30-03 06-10 13-17 20-24 27-01 04-08 11-15 18-22 25-29


Suez d 1093 1102 1079 1092 1093 1093 1095 1060 1093Fujairah d 1026 1025 1024 1025 1024 1047 1058 1066 1077Durban w 1007 1016 1045 1029 1036 1037 1057 1071 1084




KEY: d – delivered • w – ex-wharf • n/a – not available • mdo – marine diesel oil

GLANDER

Bunkerspot prices are compiled from the reports of the four brokers whose market reports have consistently proved the most reliable and accurate: Cockett Marine Oil Limited, LQM, Glander International Inc., and KPI Bridge Oil. Bunkerspot welcomes market reports from other sources for inclusion on its website www.bunkerspot.com


News Asia Pacific

New barge and port charge discount for Indian bunkeringNEWS

IN BRIEFJAPANCompeting on fuel efficiency

Hiroshi Minami, president of Oshima Shipbuilding Co., has argued that Japan’s shipyards ‘need to focus on more fuel-efficient ships to compete’.

Japan’s shipbuilders have been steadily losing ground to their South Korean and Chinese counterparts and the strong yen and relatively high wages have made their task still harder.

The Japanese manufacturers are hoping that they can persuade the shipping industry that Japan-built vessels can be more cost-effective in the long-term – even though they are more expensive to buy – because of their lower fuel consumption.

PAKISTANMix and match

Pakistan State Oil (PSO), Overseas Oil Trading Company (OOTC) and Bakri Trading Company have sought permission from the authorities to set up blending facilities to produce fuel oil that will meet the local power plants’ specifications, according to local sources.

The sources added that the scheme’s proposers believe that blending the products locally could generate savings of more than $25 million a year.

Pakistan’s refineries produce fuel oil (or ‘furnace oil’, as it is known locally) which is too viscous for the power plants and the bunker market.

CHINATerminal beginning

Sinopec began construction on 7 July on a new bonded oil terminal in the Hainan Yangpu Economic Development Zone.

The terminal will have a capacity of more than 3.7 million cubic metres (m3) and is scheduled to be completed before the end of 2012.

Double blend

Andatee China Marine Fuel Services Corp. has announced the completion of new blending facilities in Panjin City, Liaoning province, and Zibo City, Shandong province.

MALAYSIA Terminal receivership

Asia Petroleum Hub (APH), the company which is trying to establish a new multi-billion dollar oil storage and bunkering terminal in Johor, has been placed under receivership by CIMB Bank.

Although an investor has reportedly been found which can take forward the Johor project, its future is still uncertain.

Financial boost for dual fuel projectAUSTRALIA

Australia’s export credit agency has provided a multi-million dollar finance facility for the construction of a dual fuel passenger catamaran by Incat.

The Export Finance and Insurance Corp. (EFIC) has agreed to release the funds, 50% of which will be guaranteed by the Australia and New Zealand Banking Group Ltd (ANZ), to support Incat in fulfillment of its contract with Buquebus in South America.

The high speed ferry will be able to operate using liquefied natural gas (LNG)

or diesel and is scheduled for delivery in October 2012.

Buquebus will deploy the vessel on its River Plate ferry service between Buenos Aires and Montevideo.

Commenting EFIC’s decision to provide funding for the project, its Executive Director, Origination and Portfolio Management, Peter Field, said: ‘Recognising the innovative product, the contract size and the benefits of having this world-first vessel constructed locally in Hobart, Tasmania, EFIC worked with Incat’s bank, ANZ, to provide a construction finance facility that will enable Incat to deliver on the contract.’

INDIACalcutta-based shipyard Shalimar Works (1980) Ltd has built a new 500 metric tonne (mt) bunker barge for the Indian Navy.

The Poshak will serve the navy by supplying fuel to other ships as well as aircraft, according to local reports.

The managing director of the shipyard, Somdev Chatterjee, used the launch of the barge as an opportunity to appeal for more state aid from the Bengal government and the Calcutta Port Trust (CPT).

‘Our capacity to process and repair ships is limited to five vessels at a time,’ Chatterjee was quoted as saying. ‘This can be increased if we can expand our area of operation. For that we require the support of CPT.’

Chatterjee also hinted that the company might relocate to Haldia.

The Bengal State industry minister Partha Chatterjee, who also attended the Poshak launch, delivered a cool riposte: ‘The only way the company can get more orders is to ensure that the vessels are delivered to all customers in time. As the order book grows, so will the company.’

In other bunker related news, the Cochin Port Trust is offering a 50% discount on port charges, berth hire and pilotage to ships making bunkers-only calls to Kochi.

A spokesperson for Bharat Petroleum Corp. Ltd (BPCL), which supplies bunker fuel in Kochi, was quoted as saying: ‘It’s definitely going to be attractive for vessels calling for bunkers only at the Cochin port. Also, the vessels will be given priority. If these are done, we can attract more vessels to Kochi. It’s going to be an advantage for us also.’

Meanwhile, India’s Cabinet committee on economic affairs has approved a proposal to increase the capacity of the underground crude oil storage facility in Visakhapatnam.

‘The enhanced capacity at Visakhapatnam will enable larger strategic storage of crude at a lower cost because of cost sharing, while providing operating flexibility and cost savings,’ according to an official government statement.

India currently imports about 70% of its crude oil requirements, so developments to increase storage – not only at Visakhapatnam but at other locations across the country – are being rolled out as a hedge against supply disruptions.

Energy saving technology from NYK JAPAN

NYK Line and Tsuneishi Shipbuilding Co. Ltd have jointly developed an energy saving technology which reduces the wind resistance of a vessel’s superstructure.

The MT-COWL lowers wind resistance by attaching a structure to a vessel’s superstructure which creates corners with a slanted shape to reduce the effects of wind resistance.

In wind tunnel tests, a model showed that wind resistance was reduced by 10%.

This performance would equate to a reduction in carbon dioxide (CO2) emissions of 520 metric tonnes (mt) a year on a 180,000 deadweight tonne (DWT) bulker.

A prototype of the MT-COWL has now been installed on such a bulker, the Cardinal Victory, and has been tested during the vessel’s trial voyage.

NYK Line took delivery of the new vessel on 4 July.


News Africa & Mideast

NEWS IN BRIEFCANARY ISLANDSMarket expansion

Aegean Marine Petroleum Network Inc. (AMPNI) has begun physical supply operations in Tenerife.

The move follows on from the commencement of supply operations at Las Palmas in August 2010.

Aegean will manage operations in Tenerife from its existing service centre in Las Palmas. Initially the company will deploy two double-huller tankers currently operating in Las Palmas to serve its Tenerife business.

NIGERIATanker released

The Aegean Star, a tanker managed by Aegean Bunkering Services Inc., was hijacked by pirates on 16 July off the coast of Nigeria.

The 11,520 deadweight tonne (DWT) tanker was heading from Ghana to Benin when it was attacked.

However, the shipowner secured the release of the vessel within a matter of days and the crew were unharmed.

TANZANIAExpansion plans

The Tanzania Ports Authority (TPA) is reportedly working on a $520 million plan to build two new container terminals in Dar es Salaam.

Speaking at a workshop organised by the United Nations Conference on Trade and Development in Dar es Salaam in July, Julius Mfuko, the TPA Deputy Director General, said that construction on the terminals could start before the end of this year.’

UNITED ARAB EMIRATESOn track

Chemoil’s ambitious plans to increase storage capacity at its Fujairah terminal are on track, according to to the company’s Chief Executive Officer (CEO) Thomas Reilly.

Addressing delegates at the Reuters Global Energy and Climate Summit in June, Reilly said that the project is running to schedule and should be completed by the third quarter of 2012.

Ready for business

Emarat is preparing to release additional storage capacity at its terminal within the Port of Fujairah.

Currently under construction, the storage facilities will comprise 13 tanks with a total capacity of 263,000 cubic metres (m3). The company plans to offer storage for leasing from September.

GOIL ramps up MGO capabilityGHANA

Ghana Oil (GOIL) has signed an agreement to source marine gas oil (MGO) from SK Shipping.

Yaw Agyemang-Duah, the then Managing Director of GOIL who has since retired, was quoted by the Ghana News Agency as saying: ‘As a corporate objective, GOIL has sought to partner a company which is internationally recognised in its own right, and which could be relied upon to deliver MGO of the quality

required by GOIL, using vessels that are acceptable.

GOIL has also signed a strategic collaborative agreement with the Ghana Navy so it can use the berthing facilities at the Sekondi Naval Base for its MGO supply operations.

According to local sources, GOIL will be supplying the MGO to a range of clients, including supply vessels contracted by the exploration and production (expro) companies working in the Cape Three Points area of the Western Region.

Go-ahead for Mombasa terminalKENYA

The Kenyan government has granted a licence to Nile Petroleum East Africa to build an offshore multi-products landing stage and onshore storage terminal in Mombasa.

The company is a joint venture between local Kenyan investors and Sudan’s state owned Nile Petroleum Company.

Nile Petroleum East Africa Managing

Director, Nasr Eldin Elhussein, has been quoted by local media as saying that the licence was the culmination of long talks between Nile Petroleum and local partners to set up a company in Kenya.

It was also recently announced that Alatec Consulting has won a tender to conduct a feasibility study for installing an offshore loading and offloading jetty at the Kipevu Oil Terminal. Local sources said this should help ease congestion in Mombasa.

Green light for Al-Zour refineryKUWAIT

Kuwait’s Supreme Petroleum Council has approved the plans for the new 615,000 barrels a day (b/d) Al-Zour refinery.

The cost of the refinery, which will be Kuwait’s biggest, is estimated to be about $14.5 billion.

The state-owned refiner Kuwait National Petroleum Company (KNPC) issued a

tender for the refinery in June 2007 and it had been hoped that the refinery might be ready by the end of 2011. However, the government suspended the project in March 2009.

The Council is also understood to have approved plans for upgrading projects at two of KNPC’s existing refineries: the 466,000 b/d Mina Al-Ahmadi plant and 270,000 b/d Mina Abdulla facility.

The company also has the 200,000 b/d Shuaiba refinery.

OW Bunker prepares for growthUNITED ARAB EMIRATES

OW Bunker Middle East has relocated to a new, larger office in Dubai (see page 58 for contact details).

Jesper Jervild, OW Bunker’s Regional Manager for the Middle East and South Africa, commented: ‘As the third largest bunker hub in

the world, Fujairah is one of the focal areas for growth within the OW Bunker Group.

‘We expect our rapid growth in the region to continue in the year ahead, along with our market share, and are focusing on developing our business with local customers in the Middle East on a worldwide basis.’

An OW Bunker statement is available on the Bunkerspot website.

WSS secures KOTC supply contractKUWAIT

Wilhelmsen Ships Service (WSS) has secured a support contract with the Kuwait Oil Tanker Co. (KOTC).

KOTC, a subsidiary of Kuwait Petroleum Corp., owns and operates 25 vessels,

including crude, product, liquefied petroleum gas (LPG) and bunker tankers. The company is responsible for the transportation of KPC’s cargoes between Europe, West Africa and the Far East.

Under the terms of the three-year contract, WSS will coordinate and provide all major services to the KOTC fleet.


In October 2008, the International Maritime Organization (IMO) adopted regulations calling for

significant reductions in the sulphur content of marine bunker fuel over the next 10 years. The IMO also set new nitrogen oxide (NOx) limits for marine diesel engines installed on newly built vessels.

Particularly significant for the US and Canadian shipping industries will be the introduction of a North American Emission Control Area (ECA) from August 2012, requiring that 1% sulphur residual bunker fuel must be burned within the designated areas. The area of the ECA includes US and Canadian waters adjacent to the Pacific coast, the Atlantic/Gulf coast, the eight main Hawaiian Islands, Puerto Rico and the US Virgin Islands. The approved ECA will extend 200 nautical miles (nm) from the coastal baseline. While the potential shift in residual bunker fuel demand to 1% sulphur maximum is significant, at up to 25% of total heavy bunkers’ demand, it is assessed that the industry would adjust to this swing via marginal crude slate changes and blendstock imports.

US Petroleum Administration for Defense District (PADD) 3 stocks (covering the Gulf Coast) has a net positive balance of high sulphur fuel oil (>1% sulphur), which grew between 2007 and 2010. The increase is due to higher production, as well as a decline in bunker fuel sales. PADD 1’s (US East Coast) high sulphur fuel oil (HSFO) consumption is about four

Stefka Ilieva of Poten & Partners asks if the

United States and Canada are prepared for the imminent introduction of a North American ECA

times its production levels. As a result, PADD 1 has been sourcing HSFO from PADD 3 in addition to foreign imports. PADD 5 (US West Coast) is net short of HSFO. However, geographically, it has been awkward to ship it from other PADDs, thus PADD 5 relies on foreign imports to meet its demand. The bulk of PADD 2’s (US Midwest) surplus HSFO typically moves to PADD 3 for export.

PADD 3 has had a relatively stable net low sulphur fuel oil (LSFO) position – both production and demand declined during the period 2007 to 2009. PADD 1’s negative net position has shrunk, reflecting a decline in LSFO demand for power generation. PADD 5 is net positive of LSFO. However, the positive position has been shrinking, reflecting lower LSFO production.

No significant capital investment in desulphurisation capacity is likely to occur to satisfy this near term change in marine bunker quality. However, special blending and/or segregation may be necessary to meet the more stringent metals specifications in marine bunkers, particularly aluminium

Market Outlook

Poten & Partners has recently published a report: North American ECA 2012-2020.

Contact: Stefka Ilieva Poten & Partners Inc. Tel: +1 212 230 2087 Email: [email protected] Web: www.poten.com

‘Special blending and/or segregation may be necessary

to meet the more stringent metals specifications in

marine bunkers, particularly aluminium plus silicon at 60 ppm maximum’

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Demand and supply


Market Outlook

‘Without an effective post-combustion means

of reducing sulphur oxide emissions from vessel

exhaust gas, compliance with 2020’s limits seems extraordinarily difficult’

plus silicon at 60 parts per million (ppm) maximum. Market pricing will need to make these steps economic and compensate refiners for higher costs incurred to supply low sulphur marine bunker fuel.

Tightening restrictionsIMO regulations limiting the sulphur content of marine fuels burned within designated ECAs to 1.5% have been in effect since 2006/2007 in the Baltic Sea and in sections of the North Sea. These restrictions were further tightened to a maximum of 1% sulphur in mid-2010. Local bunker markets have since coped with the evolving trade patterns of this grade of fuel. When local refiners are challenged to supply low sulphur residual fuel oil to either the inland or marine bunker markets, higher prices naturally evolve to attract imports of LSFO and other low sulphur blendstocks.

The bunker fuel sulphur limit in all IMO ECAs will be further reduced 10-fold to 0.1% from 1 January 2015. This step-function change in fuel quality will require vessels to consume marine distillates in place of low sulphur bunker fuel oil if post-combustion abatement technologies are not commercially viable.

Wide use of exhaust gas scrubbers on vessels operating in these ECAs should allow the use of residual bunker fuel with sulphur contents near present levels. For now, however, irrespective of their commercial prowess, scrubbers have yet to become widely accepted. Until they are accepted, marine gasoil (MGO) or marine diesel oil (MDO),

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instead of residual bunker fuel oil, will be the marine fuel of necessity of vessels operating within an ECA.

On a global basis, the change from maximum 4.5% sulphur content to 3.5%, effective from 1 January 2012, should not present any insurmountable problems for the shipping industry since the current average sulphur level supplied is approximately 2.7%, as measured by current IMO methodology. This change is viewed as largely symbolic and should not manifest either bunker supply upsets or many marine fuel price ripples.

Long-term challengesLonger term, however, the drastic reduction in the marine fuels sulphur cap from 3.5% to 0.5% in 2020/2025 (subject to an IMO feasibility study in 2018) will present significant challenges for the industry. Refiners do not have the economic incentive to invest in residual desulphurisation capacity to produce marine fuel oil at this level of sulphur to satisfy the jump in global demand. It is also difficult to imagine that marketers will find enough marine gasoil-type stocks to blend into a low sulphur marine bunker fuel. Therefore, without an effective post-combustion means of reducing sulphur oxide (SOx) emissions from vessel exhaust gas, compliance with 2020’s limits seems extraordinarily difficult, if not impossible. Ultimately, it is expected that a combination of exhaust gas scrubbers and the switch to low sulphur marine fuels will be required to comply with the more stringent IMO vessel emission standards.



Chris Thorpe of HCEnergy finds that

the markets are moving towards a ‘new normal’

As we approach the 3rd anniversary of the 2008 financial crisis, it feels like we are back

to ‘normal’ in world markets. Sure, European sovereign debt is centre stage and, as this magazine went to press, the US Senate had just voted on a 12th hour US debt deal. As usual, there is plenty of risk in the market. But the way businesses are moving forward reminds me of pre-crisis times for a few reasons. Corporate earnings are strengthening and continue to improve, borrowing is cheap, and investors are generally bullish. Increasing appetite for risk taking and fierce resistance to government financial regulation are both signs of improving business confidence. The new normal, however, is quite different.

The old normal was a market working under the assumption that no significant government regulation was expected. Growth and investment did not fear higher capital minimums for banks or limitations on consumer borrowing. New financial regulations should impact the business environment significantly. The US Commodity Futures Trade Commission (CFTC) was empowered by new US laws written in 2010, and the European regulators are following, albeit slowly, the same path. Due to the uncertainty of impending regulation, business leaders are taking a step back and favouring a more wait and see approach. The new normal in this case is a more conservative approach to derivatives, borrowing and leverage from both the lender’s and borrower’s perspective. Even with interest rates near zero, it is not easy to borrow due to unwilling bankers.

Is there a new normal in derivatives, trading and risk? Overall, business managers are generally bullish and confident. Hedging of fuel has recovered to pre-crisis levels, with passenger airlines back to 35%-50% of fuel hedged. There are of course a few exceptions, mostly cases where chief executive officers (CEOs) were stung so badly by hedges gone bad that they fear a repeat performance. In these cases, they blame Wall Street for designing bad derivatives instead of looking

to how it could be done differently to avoid past mistakes. The old normal in the hedging world was taking on large amounts of fixed price risk through the use of swaps. Until 2008, there was little fear of a major correction or crash. The new normal for those who regularly hedge fuel is more conservative strategies, using cap price hedges with a limited risk if the market is to turn down quickly.

Beyond energy and commodities, the new normal includes wide ranges in daily currency fluctuations. Currency risk has become more of an issue for fuel markets since the value of US dollar has become less certain. As most fuels are quoted in US dollars, physical and financial hedgers outside the United States are increasingly trying to secure their product in their local currencies. For example, European fuel buyers are looking for diesel in Euros for hedging. The same can be said for British companies looking for diesel hedges quoted in Sterling, or Canadian companies hedging with West Texas Intermediate (WTI) quoted in Canadian dollars.

Certainly, global currency markets have more effect on commodities trading and prices than they had in the recent decade. In former times, a more stable US dollar was expected and interest rates were the key driver of exchange rates. Now, value swings in both the Euro and the US dollar versus other global currencies are affected more by pure risk trading than international trade requirements or interest rate arbitrage. And those averse to any currency risk have abandoned their cash for commodities such as crude oil and gold, which has reached all time highs (currently $1,586 per ounce at the time of writing this article). Though gold was out of favour as a commodity up until 2008,

Commercial Issues

Chris Thorpe is Managing Director of HCEnergy LLC, a business unit of INTL FCStone Inc.

Contact: Chris Thorpe HCEnergy LLC Tel: +1 212 774 5963 Email: [email protected] Web: www.hcenergy.com

‘Corporate earnings are strengthening and continue to improve, borrowing is cheap,

and investors are generally bullish’

‘The old normal was taking on large amounts of fixed price risk through the use of swaps. The new normal for those who

regularly hedge fuel is more conservative strategies, using cap price hedges with a limited risk if the market is to turn

down quickly’

The new normal


‘There are very few alternatives fuels for

transportation companies, and those buying bunker

fuels and marine diesel are not finding any relief from

the current trends’

grade Libyan oil is still limited and the French refiners, among others, are not amused. They are still recovering from a string of refinery strikes in 2010 which led to fuel shortages in France. Analysts have been calling for stronger crude now for the last two years, citing insufficient supply growth to meet even a modest global recovery. Speculative interest is on the rise, aided by forecasts of ever higher crude oil prices – give or take $20 a barrel. The new normal market is prepared for much higher prices, and almost expects it. And the majority of non-commercial buying is less speculative and more committed to owning natural resources as an asset class rather than speculating on the next big rally.

There is more to support higher prices of crude oil than just tighter supply, of course. Fundamentally, the developed economies have forced themselves into very high quality specifications for fuel as well as forcing demand for high cost ‘alternative’ fuels. And the trend toward tighter environmental standards continues to push refineries to produce ultra low sulphur diesel. Sadly, there are very few alternative fuels for transportation companies, and those buying bunker fuels and marine diesel are not finding any relief from the current trends. The loss of nuclear power capacity in Japan and the risk that other nuclear plants may come off line for safety reasons or due to political pressure may result in higher demand for fuel oils. Despite higher and higher energy prices, the new normal business model is to accept environmental constraints and pay the costs.

While the recovery matures, we witness dynamic changes in the global economy which is more interdependent than ever. Demand in emerging markets drives global

growth and so it is watched closely. Financial markets continue to flirt with the contagion risk tied to European and American debt woes. This ebb and flow of a risk-on and risk-off market place will continue to annoy traders that attempt to bet on trends. However, the lessons learned from 2007 and 2008 were that prices can rise quickly when markets are good, and fuel is likely the first to spike and hurt profit margins. With the price of crude oil higher than $100 a barrel, managing price risk will continue to be challenging – and we ought to prepare for a new normal when wide swings in prices are based on headlines and on one-day phenomena.

it has become a safe haven yet again as part of the new normal market conditions.

Given more interdependency, market contagion is more the norm than the exception. This means that headlines and global news events tend to affect all markets instead of narrowly impacting local markets. For traders, it is often as simple as ‘buy the rumour and sell the fact’. Perhaps fortunately for the ailing news distributors, headlines are driving markets more after the events of 2008. The new normal is about large moves in market volatility with very few fundamental changes. On 5 May 2011, for example, commodity markets fell dramatically following news that large hedge fund players were dumping their positions. Oil was down more than 6% and silver was down more than 9% in one day alone. No fundamentals had really changed in the respective markets.

Volatility, as measured by the equities market volatility index (VIX) and even crude oil implied volatility, has fallen back to historically low levels. Some technical analysts may even argue that implied volatility in options markets has flagged a market top. But this decreased implied volatility has been coupled by sudden one day moves such as the equities flash crash of 6 May 2010 when the Dow Jones Industrial Average experienced a 900 point drop.

Both positive and negative news headlines now cause more dramatic gyrations in the markets. These up and down movements are now often labelled as ‘risk on’ or ‘risk off ’ in the new normal. It could signify that investors and traders are not committed to anything longer term. Despite regular bouts of ‘risk off ’ selling days, there remains solid fundamental demand for energies – not surprisingly. High

The new normalCommercial Issues


With the close of the second quarter, there is increased anticipation about how

shipping companies have fared in the midst of a very challenging first half of 2011. Lloyd’s List Intelligence (LLI) is taking a closer look at how debt burden can play a detrimental role within shipowners’ liquidity in 2011.

LLI reviewed six publicly-quoted dry bulk companies: Genco Shipping & Trading Ltd, Eagle Bulk Shipping Inc., Navios Maritime Holdings Inc., Paragon Shipping Inc., Excel Maritime Carriers Ltd and Diana Shipping Inc.; as well as six publicly-quoted tanker companies: Overseas Shipholding Group Inc., Teekay Corp., Frontline Ltd, General Maritime Corp., Nordic American Tanker Shipping Ltd, and Torm A/S.

LLI calculated that, on average, cash flow from operating activities (CFO) turned negative between the fourth quarter (Q4) of 2010 and the first quarter (Q1) of 2011 for tanker companies, but dry bulk companies remained CFO positive on average. Tanker rates have been depressed since June 2010, while the sharp decline of dry bulk rates started much later. Dry bulk companies saw an average CFO decline of 8.71%. On a funds from operations (FFO) basis – which is operating cash flow without accounting for changes in working capital and a truer measure of cash profit a company earns in the period – dry bulk companies saw an average decline of 19.84%.

LLI also looked at the impact that the lower profits had on the interest coverage ratio (using CFO), which measures the company’s ability to cope with its interest burden. The average interest coverage ratio for dry bulk companies was marginally up between Q4 2010 and Q1 2011 and remained very comfortable at north of 9:1, but the latest ratio was below the average for 2010. However, tanker companies’ interest coverage ratio declined by 22.87% to an average of just under 3:1 in Q1 2011. LLI would deem an interest coverage ratio of 3:1 to be comfortable, so tanker companies crossed an important mark in the latest quarter.

Although market rates affect every shipping company’s cash flow in the short term and our research indicates that companies may not be generating enough cash flow at present, another way to measure the likelihood that a company will face major liquidity problems is by paying attention to how aggressive companies are willing to add debt to finance their operations and even add

Félix Yamasato of Lloyd’s List Intelligence

asks at what point will auditors force owners

to write-down the book value of vessels capacity (vessels) during uncertain times. This

often leads to financial trouble.LLI calculated that together the six

reviewed tanker companies spent $4.009 billion in capital expenditures between Q1 2009 and Q1 2011. Management teams seem to have been more optimistic in 2010 with 56.16% or $2.251 billion of the spending in that year alone. In the aggregate, $1.988 billion was raised from banks and debt issuances to support capital investments with 86.34% of it taking place in 2010 ($1.716 billion). Another $1.814 billion was raised in equity; 62.93% of this in 2010.

On the dry bulk side, the six reviewed companies together spent $3.363 billion in capital expenditures between Q1 2009 and Q1 2011, with 53.19% spent in 2010 alone. In the aggregate, $2.033 billion was raised from banks and debt issuances to support capital investments with roughly similar amounts raised in 2009 and 2010. $574.46 million was raised in equity; 71.86% of this in 2010.

LLI’s research shows that in the aggregate, debt financings’ share of capital expenditures has gradually been reducing since Q3 2010 – effectively providing proof that banks were lending less and less. Understandably, both tanker and dry bulk companies, on average, cut back on capital expenditures between Q4 2010 and Q1 2011, as banks progressively tightened credit, forcing companies to seek alternative financing options. In Q1 2011, tanker companies made net debt repayments (net outflows from financing activities), while dry bulk companies reduced it dramatically.

However, how can we tell if a particular company is being overly aggressive and therefore increasing its risk profile? LLI added dividend payments to and subtracted equity issues from net cash provided by financing activities in order to arrive to a truer amount of net debt raised. On this metric, Overseas Shipholding Group Inc. and General Maritime Corp. raised the most debt since 2009 amongst tanker companies, while Navios Maritime Holdings Inc. and Genco Shipping & Trading Ltd raised the most debt amongst dry bulk companies. Yet, Navios Maritime Holdings Inc. had reduced

Interesting timesCommercial Issues

Félix K. Yamasato is Regional Manager, Americas Analyst Team with Lloyd’s List Intelligence.

Contact: Félix K. Yamasato Lloyd’s List Intelligence Tel: +1 646 957 8971 Mob: +1 203 667 1082 Email: [email protected] Web: www.lloydslistintelligence.com

‘When owners are forced to sell, net losses will bring

down equity and an even greater number of covenant violations will be reached’


debt profile, with General Maritime Corp. facing near death earlier in 2011 and still in need of improving its liquidity to survive, while Overseas Shipholding Group Inc. was also preempting possible liquidity problems.

As I wrote previously in Bunkerspot, LLI continues to argue that publicly-quoted dry bulk companies tend to be on stronger financial footing than privately-held group and especially small players (see Bunkerspot, April/May, page 26). If debt financing has dried up and debt re-structurings are happening amongst publicly-quoted companies, what options are left for small players? It seems obvious that it will not be too long before they have to sell or scrap assets to avoid insolvency. When owners are forced to sell, net losses will bring down equity and an even greater number of covenant violations will be reached.

At which point would auditors force owners to write-down the book value of

its borrowings to a negligible level in 2010.LLI also measured how much of this ‘new

debt’ compared to capital expenditures, which will indicate the degree of leverage taken to acquire the additional tonnage, potentially creating further liquidity problems.

Amongst dry bulk companies, Diana Shipping Inc. and Navios Maritime Holdings Inc., ‘increased leverage’ was above 70%. Genco Shipping & Trading Ltd raised a substantial share of its capital via equity issuances, so its increased leverage came to a more manageable 38%. All of these three companies showed relatively stronger liquidity indicators that probably helped in obtaining the mortgages.

However, amongst the tanker companies, General Maritime Corp. and Overseas Shipholding Group Inc. increased leverage came above 50%, below that of the most aggressive dry bulk companies. Yet, both companies were forced to re-structure their

Commercial Issues

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vessels? LLI research seems to indicate that tanker asset values are at higher risk of declining sharply in 2011, but Clarkson’s Asset Play Index shows more stable tanker prices than dry bulk prices. Tanker asset prices have been holding steady not too far under 150 in the past 12 months, while dry bulk asset prices have been declining from around 230 in the summer of 2010 to under 200 in June 2011.

LLI’s clients in the counterparty risk side, which for the most part include marine fuel suppliers, seem to view tanker companies as lower risk than dry bulk companies, but the market will just have to find out when it actually occurs. The recent Chapter 11 filing of Omega Navigation Enterprises Inc., a publicly-quoted company that cited the ‘unwillingness of its senior lenders to work with Omega on an out-of-court restructuring of its senior loan agreement’, may be the first indication of what’s to come.


‘It’s clear that the shipping industry is struggling and the high bunker prices don’t exactly help the situation either’

pretty scary. There are plenty of ways of getting in trouble here and companies need to apply great governance and care. It’s clear that the shipping industry is struggling and the high bunker prices don’t exactly help the situation either.

Bunkerspot: Do you expect more casualties amongst the shipping community?

Grunwaldt: I think something has to give. I just can’t see how some shipping companies can continue to exist with high costs and low income. I hope it will not happen, but it would be a surprise if it doesn’t.

Bunkerspot: What are the biggest challenges and opportunities right now for the bunker industry?

Grunwaldt: The challenge for the industry in the short term future will be – apart from the economy – the sulphur regulations that shipping is facing. We all agree the target is to pollute less. I’m just not convinced we are going about it in the most efficient way. But it does provide opportunities as well. And then we obviously notice that some majors are pulling back from the bunker market while other ‘types’ of companies enter.

Bunkerspot: Is the ‘landscape’ changing in the bunker market?

Grunwaldt: I certainly think so; there seems to be a push for new players to enter the market, while older, more traditional players are scaling down. The way we are seeing the big cargo trading companies getting involved throughout the chain is obviously interesting, even tank operators seem to be getting a taste for the bunker market. In addition, it seems the traditional bunker traders and brokers are changing their game. Lastly, you have new aggressive companies with seemingly endless cash to burn entering the frame as well. The market is definitely changing.

Peter Grunwaldt was recently appointed Chemoil’s Director of Sales. The company has

undergone some major changes recently (see page 58), but Grunwaldt said that Chemoil remained ‘optimistic about the future’ and confident that it was ‘better equipped than most to weather the storm’.

Bunkerspot: Chemoil came out with a smaller profit in the second quarter (Q2) of 2011 than Q1 ($4.7 million compared to $31.5 million) – what are your thoughts on that?

Grunwaldt: Well, basically everybody knew Q2 was going to be more difficult than Q1. We might be on the low side compared to Q1 but it’s nevertheless a strong first half of the year. Volumes are steady for us, and not everybody has been making money in a very difficult term, so in many ways we take confidence from the performance of the first half of 2011.

‘No doubt it has been more fun than it is right now in shipping,

but with the strength of our group we should be better

equipped than most to weather the storm’

Bunkerspot: What will the second half of the year bring?

Grunwaldt: I can only speak for Chemoil, but we are optimistic about the future. There are so many good things happening in the company now that will start benefitting us very soon.

No doubt it has been more fun than it is right now in shipping, but with the strength of our group we should be better equipped than most to weather the storm. There are plenty of scenarios out there, with the world economy threatening to derail any kind of recovery – but as a group we have faith in our ability.

Bunkerspot: So you don’t have great hopes for the immediate future and the bunker market?

Grunwaldt: From a macro economical point of view, I think things are looking

Chemoil’s Peter Grunwaldt talks to Bunkerspot about

the company’s recent financial results and

future prospects

Commercial Issues

Peter Grunwaldt is the new Director of Sales for Chemoil Energy.

Contact: Peter Grunwaldt Chemoil Email: [email protected] Web: www.chemoil.com

‘I think something has to give. I just can’t see how

some shipping companies can continue to exist with

high costs and low income. I hope it will not happen,

but it would be a surprise if it doesn’t’

Question time

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Søren Christian Meyer argues that preparation,

not procrastination, is the best way to deal with the

impact of ECAs

There has been much talk within the bunkering industry and the wider shipping world about the

impact of the impending 2015 Emission Control Area (ECA) sulphur regulations. Whilst the concern over the impact of these regulations from certain quarters is understandable, particularly for those in the short sea shipping market, lobbying for a postponement at this late stage is not the answer. Not only is such a course of action unlikely to succeed, it also risks inducing apathy amongst shipowners and operators at this crucial time. Instead, they should be actively preparing their operations for the transformation and designing fuel procurement strategies to take advantage of the opportunities that change inevitably brings.

One argument that has been made is that the introduction of the 2015 sulphur regulation will result in the unintended consequence of driving freight off ships and back onto roads, despite shipping already being the most environmentally friendly form of transport.

For the short sea market, there are clearly justifiable concerns, which have been substantiated by the publication of last year’s study by the German shipowners’ association Verbandes Deutscher Reeder and German ports association Zentralverband der Deutschen Seehafenbetriebe. The study estimates that ferries to the Baltic states could lose 46% of their traffic. Overall, up to 823,000 twenty-foot equivalent units (TEUs) and around 604,000 trailers a year would move from sea to land transport if shipowners were compelled to meet the 0.1% figure. In contrast, the report concludes that cutting the sulphur content to 0.5% would be both manageable and have a significant impact on emissions without greatly raising costs.

Ultimately, I believe that we are too far down the road. The industry is under such environmental scrutiny from legislators, environmental interest groups, and indeed consumers, that any regulatory amendment would be seen as an unacceptable u-turn on behalf of an industry that is perceived to be unwilling to change or adapt. That might be harsh, but perception is reality to the outside world. Their argument is a simple one; that a line must be drawn, that positive progression – however hard – must start somewhere and that the shipping industry must ultimately look to innovation and clean fuels as a solution.

Furthermore, when tighter sulphur regulations are supported by the likes of the Danish shipowners’ association, the

European Commission (EC) and many other lobby groups, including Soot Free for the Climate Campaign and the Industrial Metal Workers’ Union Coastal Region, it is hard to see how the 2015 deadline can be avoided.

The bigger concern at this stage is that this intense lobbying for a delayed introduction of the 2015 regulations will lead to false hope and create a sense of apathy in the market. In some senses, this poses more of a threat than the regulation itself, as it will leave many companies exposed without a real plan of how to manage the change to the post-2015 reality.

And herein lies the key. The best and most appropriate reaction to inevitable change is preparation. Rather than stonewalling, we would encourage shipowners and operators to focus their energies on rigorous planning, analysing every facet of their operations and understanding how regulations will impact their businesses.

They should not just focus on the price perspective, but run a detailed analysis that takes into account specific trading routes, when and where they need to change to distillates and the technical complexities of switching from heavy to clean fuel, as well as the potential issues with engine damage and downtime. Having this level of insight and understanding will give a complete overview of how regulation will impact operations, where changes need to be made and identifying solutions that can be adopted.

When it comes to solutions, we are all aware of the three key areas; technology, liquefied natural gas (LNG) and distillates.

Although scrubbing technology is a viable option, the industry is still waiting for formal ratification at International Maritime Organization (IMO) level and there needs to be the ability on the side of the manufacturers to meet demand. When we talk about intensive lobbying, this is where focus needs to be placed – on ensuring that innovations are available to meet the demands of regulation.

In terms of LNG, there are still many questions that need to be answered and challenges that need to be overcome in relation to supply, infrastructure and the physical bunkering process.

None of this is insurmountable, but by 2015? It is looking unlikely.

So that leaves distillates. There is widespread awareness of price concerns and issues with the refining process. And while supply will come into question in 2025, in 2015 there should not be an issue. It is down to fuel suppliers to look at all the options,

Environmental Issues

Prepare for impact

Søren Christian Meyer is the Global Sales Director of OW Bunker & Trading A/S.

Contact: Søren Christian Meyer Email: [email protected] Web: www.owbunker.dk


customers that are seeing the benefits. It is a model that is serving to build closer, long-term relationships with customers, and it is also enabling those companies to take a positive and progressive role in helping them overcome the challenges of this industry.

Regulation will undoubtedly put pressure on the industry, but the long-term view is a positive one.

When it comes to the environment, no one disagrees that shipping is the most environmentally efficient and cost-effective mode of transporting goods. That isn’t going to change. But that does not mean that the industry shouldn’t do everything that it can to improve standards – from the quality of products and services that we provide as fuel suppliers, to the way that engines are powered and vessels are operated. Change is never easy, but those that realise that it is coming and adapt to the transition will seize the opportunities that change always brings.

such as innovative methods of blending, to ensure that this is the case.

From a price perspective, shipowners and operators must focus on planning the procurement process for distillates as another key element of a risk management strategy. Their goal will be to ensure that they get the best price for the long term, so, as a minimum, costs can be controlled and profits maintained as much as possible.

To achieve this, there must be a close relationship between the fuel supplier and the customer. It has to be viewed as a partnership, which requires trust.

This trust can be built if the relationship is founded upon the principle of working together to drive as much efficiency and profitability as possible into the customer’s business. This is a role that fuel suppliers should embrace, because they have the knowledge, the technical insight and the analysis methodology to work closely with

customers to help them develop a robust strategy for change.

In some quarters, this has led to the concept of fuel supply outsourcing. This isn’t necessarily a new business model, as it has been utilised in land-based industries, particularly financial services, for many years. However, the basic principle of handing over areas of non-core business activities to external experts, so that you can focus on your day-to-day operations, makes sense. It saves time and money, increases efficiencies and should deliver products and services that are of a higher standard than if conducted in-house.

So when fuel accounts for 60% of a vessel’s operating costs, why can outsourcing not work in this scenario? The answer is that it can and, most importantly, it is happening.

At OW Bunker we have a number of outsourcing relationships with progressive companies, including short sea shipping



Pierre C. Sames of Germanischer Lloyd

presents the zero emission container

feeder vessel

A slim blue vessel slides into view, silently drawing up alongside a gleaming platform. In the

distance stately white turbines look down, their massive blades gently rotating in the wind. Two slim arms swing down from bunkering stations on the platform to each end of the vessel and a short time later the vessel glides off again, over the waters of the North Sea. A vision of the future?

A low carbon horizonThe global fleet is increasing and, barring radical change in the nature of the world’s supply chain, it will continue to grow. Increased awareness and accompanying regulations have brought sulphur oxide (SOx), nitrogen oxide (NOx) and particulate matter (PM) emission reduction to the forefront of discussions about the environmental impact of shipping. Reductions in carbon dioxide (CO2) and other greenhouse gas (GHG) emissions seem set to form the backdrop for future controls.

Efficiency gains promise much, perhaps as much as a 20% reduction in CO2 emissions across the global fleet. But even such impressive gains as these will not prevent total emissions from shipping from increasing, let alone help to hit the reduction targets relative to historical figures – such as those proposed by the European Commission (EC), which is calling for a reduction in CO2 emissions to 40% of 2005 levels by 2050.

Global shipping, emitting just under 3% of global CO2 emissions and playing a relatively small part in CO2 emissions, compared to energy generation or road transport, needs to look to innovative designs and alternatives to traditional fuels to meet the ambitious reduction targets that are on the horizon. A possible solution to these challenges is to create a truly zero emission vessel – a holistic model which would produce no SOx, NOx, PM or GHGs, in either its fuel production or consumption.

The Zero Emission Container Feeder Vessel is such a design concept. It was created by Germanischer Lloyd (GL) Strategic Research and Development as a completely emissions free vessel powered by liquid hydrogen (LH2). Fuel for the vessel would be produced through wind energy, and the concept is built around a vessel that operates in northern European waters, with a typical round trip of 10 days.

Design and principal features The design concept is for a container feeder vessel with a full open top 1,000 twenty-foot

equivalent unit (TEU) intake with 150 reefer slots. The open top design reduces loading and unloading time. Creating these efficiencies in port helps to reduce emissions, as the vessel is longer at sea and can reduce speed compared to a standard vessel which remains longer in port. The vessel has standard principal dimensions but a reduced design speed of 15 knots to reduce the required propulsion power.

There are two power generation rooms, situated forward and aft. The vessels uses two podded propulsors for its primary propulsion and a ‘take-me-home’ thruster, providing for extra manoeuvrability and drive redundancy.

The vessel would rely on a 5 megawatt (MW) fuel cell system for propulsion, made up of 10 linked 0.5 MW modules. This system would be powered by LH2, stored in multiple pressurised type C tanks, holding 920 cubic metres (m3). This storage capacity would hold enough LH2 to power the vessel over a typical 10 day round trip. Based on GL’s 2009 study for a container feeder fuelled by liquefied natural gas (LNG), it is estimated that approximately 6% of the TEU capacity of the vessel would need to be sacrificed for the hydrogen fuel tanks. With tanks feeding the fuel cells both forward and after, the concept envisions a dual bunkering approach to achieve a refuelling time of three hours.

Fuel cells typically cannot generate peak power rapidly and because of this a 3MW battery system, charged by the fuel cell system, would provide additional power for peak usage.

Investment costsThe LH2-fuelled container vessel has significantly higher investment costs than a similarly sized vessel of traditional design. Based on data from a GL market study on fuel cell systems and the aforementioned 2009 LNG feeder vessel study, the cost of the LH2-fuelled vessel is estimated at approximately $35 million, 60% higher than the $22 million for a vessel fuelled with heavy fuel oil (HFO) or marine gasoil (MGO). The largest part of this increase is associated with the fuel cell system (57% of additional costs), the type C tanks (37%) and the battery system (6%). This


Pierre C. Sames is Senior Vice President, Strategic Research and Development, at Germanischer Lloyd. He is responsible for coordinating all technical research and development projects. He is also the chairman of the SAFEDOR Steering Committee. His previous experience includes research into hydrodynamic extreme loads and risk analysis. He joined GL in 1995 after studying naval architecture in Hamburg.

Contact: Pierre C. Sames Germanischer Lloyd Tel: +49 40 361490 Fax: +49 40 36149-250 Web: www.gl-group.com

‘The LH2-fuelled container vessel has significantly higher investment costs

than a similarly sized vessel of traditional design’

Blue sky thinking


estimate assumes that the costs associated with fuel cells production will continue their steady decline, with an expected drop in investment cost by 2020 to $1,500 per kilo Watt (KW).

LH2 production and deliveryTo be a truly ‘zero’ emission vessel, one has to look not only at the emissions from the vessel itself but of the production of its fuel. This design concept therefore suggests a bunkering station that produces LH2 through the use of renewable wind energy. Electricity generated by wind energy does not result in any CO2 emissions or create pollution to air and water from other harmful gases or materials.

The 2020 generation target for offshore wind parks operating in the German Exclusive Economic Zone (EEZ) is an installed capacity of approximately 3GW. One of the disadvantages of renewable energy in its current form, however, is the problem of matching the intermittent nature of the supply with consumer demand. Insufficiencies in the grid and underdeveloped storage technologies mean that wind turbines are

Blue sky thinking

often not turning when they could be. Studies have estimated that as much as 30% of an offshore wind farm’s potential energy generation is not able to be fed into the grid.

Based on this, up to 3,600 GW hours (GWh) per year of the energy generation potential across the EEZ is potentially available for extra grid uses, such as LH2 production. Taking these estimates, a 500 MW wind farm could produce up to 10,000 metric tonnes (mt) of LH2 using its generation surplus. This could then serve the bunkering needs of five feeder vessels of the size presented above.

The hydrogen produced would then be liquefied and stored in tanks. Intermediate storage of LH2 for up to 10 days would require insulated tanks of up to 5,000 m3 to be installed. With the wind park operating approximately 4,000 hours per annum, the price of LH2 would be up to $7,500


‘To be a truly “zero” emission vessel, one

has to look not only at the emissions from the vessel itself but of the

production of its fuel. This design concept therefore

suggests a bunkering station that produces

LH2 through the use of renewable wind energy’


per tonne. These costs include production, liquefaction and storage on site.

Competitive with MGO in 2025Based on GL estimates, LH2 produced through wind power could begin to be commercially attractive as an alternative to MGO in the 2020s, if MGO prices increase to $2,000 a tonne. To arrive at this estimate, annual costs for an LH2-fuelled feeder vessel, including fuel costs, other operating costs and annualised capital costs, have been compared with the annual costs of a standard container feeder vessel using MGO as fuel and operating inside an emission control area (ECA). The difference between current MGO prices and the expected price level required to make LH2 commercially

attractive should be considered in the light of MGO prices over the period 2000 to 2010. During this decade, MGO prices increased from $250 a tonne to $650 a tonne, with an intermediate peak value of $1,319 in June 2008.

New technologyThe pressure to reduce GHGs will only increase over the coming years and 2020 is a date within the lifetime of many vessels currently operating. To reach the target of reducing CO2 levels against historic levels, new technologies must be implemented. This vision of a zero emission vessel shows how new technology can contribute to meeting such targets and propel the industry into the future.


‘The pressure to reduce greenhouse gases will only increase over the

coming years and 2020 is a date within the lifetime

of many vessels currently operating. To reach the target of reducing CO2 levels against historic

levels, new technologies must be implemented’


Everyone is talking about gas fuelled ships as the way forward to reduce air emissions. Fewer people are

pointing out the pragmatic steps needed to ensure that lower emissions don’t mean less safety.

‘There is nothing new in having liquefied gas on ships, and nothing new in engines which burn gas. And gas carriers have one of the very best safety records of all ship types,’ says Andrea Cogliolo, the Head of the Machinery Sector at Registro Italiano Navale (RINA). ‘But we need to take great care when we extend gas power to other ship types. Substantial changes are needed to the structure and outfit of the vessel, and the crew need to be trained to understand the new fuel and its risks. Carrying and using gas at sea requires a culture which is present on gas carriers, but which is not found on most other ship types.’

RINA has just published a new notation, called Gas Fuelled Ships, which establishes requirements for the use of liquefied natural gas (LNG) or compressed natural gas (CNG) on board ship as an alternative to traditional fuels. It is designed to give the industry a regulatory tool to ensure that the arrangement and installation on board of machinery using this type of fuel are such as to provide a level of integrity, from the point of view of safety and reliability, equivalent to that of a conventional installation.

Cogliolo believes there are many advantages in the use of gas as a fuel in terms of reducing air emissions.

‘The use of natural gas as a fuel provides the advantages of a total reduction in sulphur oxide (SOx) emissions, a considerable reduction in nitrous oxide (NOx) emissions, a 20% reduction in carbon dioxide (CO2) emissions and competitive prices at current costs and estimates for the near future,’ he says.

‘But there is a cost in terms of new kit, new design, operational flexibility and crew training. All of these issues will be covered in a new International Maritime Organization (IMO) Code for Gas Fuelled Ships, but that is not going to be ready before 2014. Our owners and the yards we work with need to know how to tackle gas fuel issues safely now, so we have brought out this new notation and amended our Rules to

‘We will not see a lot of small fixed LNG terminals for fuelling ships springing up. Instead, I expect the fuelling will be done by smaller

LNG tankers, and that means ship-to-ship transfer of very cold LNG’

provide guidance on the requirements.’Cogliolo says the basic starting point for

the equivalency of safety is to recognise that gas as a fuel has a very much lower flashpoint than marine fuel oils, and also that it is stored as a liquid at very low temperatures or as a gas at very high pressure.

‘Therefore, if there is any escape or leakage, there is both the possibility of explosion and the possibility of the extreme cold liquid gas causing structural damage,’ he explains. ‘The rules are aimed at mitigating those two issues. That means firstly that all materials and structure which are in gas service or could be affected by a leakage must be able to withstand the low temperatures. Secondly, the arrangement on board of storage tanks, piping system and engine rooms must minimise the likelihood and the consequences of an accident, for example tanks and gas piping must be located so as to minimise the risk of collision damage.’

RINA looks for tanks in protected locations near the centre line.

‘You need a lot of space for gas carriage,’ says Cogliolo. ‘The double bottom and prismatic tanks used for oil cannot withstand the pressures which build up in a tank of LNG even over a short period. A cylindrical tank is required, and even then it will have to be used within two weeks if pressure is not to become too high.

‘On a tanker, you can see that such tanks can be mounted on the open weather decks forward of the accommodation. For bulkers, it is a much harder design issue, as you may end up losing a hold or a big part of a hold from the cargo spaces.’

A gas leak could lead to fire, explosion

Andrea Cogliolo of RINA tells Bunkerspot how

operators can ensure that gas fuelled ships are safe

Safety toolLNG Bunkering

‘The basic starting point for the equivalency of safety is to recognise that gas

as a fuel has a very much lower flashpoint than marine fuel oils, and also that it is stored as a liquid at very low temperatures or as a

gas at very high pressure’

Andrea Cogliolo is the Head of the Machinery Sector at Registro Italiano Navale (RINA). Established in Genoa in 1861, RINA is one of the oldest classification societies. Its services cover the environment, energy, transportation, logistics, safety, quality and social responsibility.

Contact: Andrea Cogliolo Web: www.rina.org


or structural damage, so leakage consequence risk is tackled by requiring that all gas pipelines are double walled. The space in the double wall is alarmed so that any escape of gas from the inner pipe will be contained by the outer pipe and also let the crew know there is a problem. Routeing of gas pipes to avoid accommodation and explosion risk areas is also required.

Gas fuel distribution in machinery spaces must use double wall pipes or there must be emergency shutdown systems automatically activated in case of gas leakage in the machinery space and consequently a double redundant engine room setup.

‘You can see how the design consequences of a decision to build in LNG as a fuel multiply,’ says Cogliolo.

‘Either you need extensive monitored and alarmed double wall piping, or two completely separate machinery spaces. And you have to find room for the gas process machinery, at the same time, in a dual fuel installation, as having all the normal oil outfit.’

Estimates of the space penalty vary but Cogliolo says that, depending on the ship type, the amount of space needed for a liquid gas fuel installation compared to a conventional oil one is in the order of three to four times as much.

RINA is bound by confidentiality rules from naming specific projects, but it is working with a shipyard and an owner on a possible tanker design which would be a

conventional tanker with a gas fuel tank or tanks on the weather deck, to be used to fuel the vessel in low sulphur areas. RINA is also involved in two studies, one examining the economics of giving over cargo space to gas storage for a bulk carrier design, the other looking at potential for gas fuel on a cruise ship.

‘Our notation does not address two big issues facing owners looking at using gas fuel,’ says Cogliolo. ‘One is crew training, the other is the supply of gas bunkers. These issues are outside the remit of class; we are here to keep things safe and efficient from the structural and outfit perspective. But the issues are linked, because the crews of passenger ships and cargo ships are not used to handling gas, and not used to LNG ship-to-ship transfers, and both of these will become common once gas is in greater use.’

Cogliolo goes on to say that RINA is not aware of any concrete initiative to begin LNG fuel supply to ships in the Mediterranean area.

‘It will come,’ he says, ‘because we all want cleaner air. But we will not see a lot of small fixed LNG terminals for fuelling ships springing up. Instead, I expect the fuelling will be done by smaller LNG tankers, and that means ship-to-ship transfer of very cold LNG. It is also a flexible way for suppliers to begin offering a service without committing to a fixed installation ashore. Again, it is not new technology, but so far ship-to-ship LNG transfer is done only by

experienced gas carrier crews. So we will need to see a big effort to train up the crews of other ships using gas as a fuel. The training will have to mirror that of gas carrier crews and focus strongly on ship-to-ship transfers. That will be a major part of the IMO Code when it is ready.’

Italy is a major gas importing and distribution hub for Europe and RINA has been heavily involved in the development of onshore, offshore fixed and the world’s first offshore floating LNG terminals.

‘We know about gas, and we believe in it as a fuel,’ says Cogliolo. ‘Our job now is to take the hype out of the rush to fuel ships with gas and make it a safe, practical and economic reality.’

LNG Bunkering

‘We know about gas, and we believe in it as a fuel.

Our job now is to take the hype out of the rush to fuel ships with gas and make

it a safe, practical and economic reality’


Bunker Sampling

Chris Leigh-Jones of Kittiwake looks at why it is so important to cut

through the noise on sampling and monitoring

In 2010, more information was circulated globally than all the accumulated information passed

in all previous years. The exponential expansion of the Internet, particularly social media sites, has meant that the average internet user visits 59 domains and views 1,050 internet pages each month.

A shipping industry that is increasingly fast-moving – driven by new regulations, security issues, health and safety, the environment and increasingly public scrutiny – has not escaped this trend for greater proliferation and requirement for information. Shipowners and operators could be excused for feeling barraged by information. Nevertheless, finding information is important. Filtering through to the right information is even more important.

Take regulation, for example: whether it is the International Organization for Standardization’s (ISO) revised ISO 8217:2010 specification on fuel content and quality, the International Maritime Organization’s (IMO) MARPOL Annex VI (sulphur emissions), ballast water, maritime security, health and safety, the list is endless. When ships take onboard bunker fuel, regulation is of paramount importance; otherwise the amount of bunker fuel piped onboard could not be assessed, nor contents and quality of the fuel fairly and accurately tested, for example. Moreover, as emissions are increasingly scrutinised by regulators, so an owner / operator needs to understand in detail what the compliance parameters are. Where can testing can take place? What testing facilities and equipment are available? What are the current emissions level requirements? What are the risks in procuring poor quality bunker fuel?

Bunker sampling and monitoring illustrate why it is not only essential to monitor the quality of fuels and protect critical equipment and machinery, but it is also imperative for regulatory compliance and dispute resolution purposes. Along with the monitoring of lubricants and emissions, regulation has meant the risks and rewards of accurate and reliable monitoring data can make a significant dent or improvement upon the bottom line of a shipowner or operator.

Given the increasing relevance of condition monitoring to the shipping industry, Kittiwake has launched the world’s first marine-focused condition monitoring information portal (www.machinerycondition.com). This resource is designed to provide stakeholders with detailed

technical information and practical guidance across every aspect of marine condition monitoring, with information continually updated as international rules, regulations, technology and working practices change.

Cutting through the myriad of regulations and compliance issues can be complex. In May 2011, the bunker fuel testing company DNV Petroleum Services (DNVPS) characterised off-specification bunker fuels as the ‘biggest challenge’ in terms of the technical aspect of ship operators’ business during 2010. A DNV report concluded that 94% of 96 respondents coming from the technical, operations and management departments of shipping firms said they encountered problems with bunker fuel deliveries.

Around 50% of the shipping representatives said the ‘fuel quality cases they encountered were resolved in a satisfactory manner’, although 18% of them did not report a positive outcome. The 18% said the availability of an industry standard on fuel contaminants, technical advice guiding the ship on how to use problematic fuels and de-bunkering, would have been useful.

Additionally, over 90% of the representatives involved in purchasing listed fuel performance indicators, which include off-specification delivery records and delivery quantities, as the most important considerations when buying bunkers.

Some 14% of the total respondents, meanwhile, said they had to debunker the seriously off-specification fuels they received, while 9% did not have to offload but managed to use the problematic fuels based on advice from fuel management companies.

Much of the challenge for shipowners and operators procuring bunker fuel is that as the shipping industry moves to cleaner fuels, so the source of that fuel and the resulting content become more fragmented and, in some cases, incompatible. How many owner/operators know, for example, that when they purchase 1% low sulphur fuel that this fuel

‘Bunker sampling is not only essential for monitoring the quality of fuels and

protecting critical equipment and machinery; it is also imperative for regulatory compliance and dispute

resolution purposes’

Information overload

Chris Leigh-Jones is a Director with Kittiwake Developments, a provider of monitoring and testing technology solutions, with offices in the UK, Germany, United States, and Asia.

Contact: Chris Leigh-Jones Kittiwake Developments Tel: +44 1903 731 470 Web: www.kittiwake.com


Bunker Sampling

has been blended with ‘cutter stocks’ such as marine diesel oil (MDO) that is diluted with heavy fuel oil (HFO). As fuel sources alter and there is increasing demand for multiple emission level bunker fuel, so the cutter stock is less likely to be sourced from the same refinery or region as the HFO it is being blended with, for example.

Global bunker player OW Bunker last year urged fuel suppliers to take ‘greater responsibility’ in helping shipowners overcome the technical difficulties associated with using lower sulphur fuels. It warned that some shipowners and operators had been experiencing problems including loss of propulsion, engine failure, filter blockages and damage to auxiliary pumps.

‘Switching to low sulphur fuel oils and distillates is complex and there needs to be a deep understanding of the technical process,’ Steffen Kortegaard, Technical Director, OW Bunker, was reported saying.

This view was recently corroborated by Iain Butterworth, Associate Director of UK-

based Myton Law, who reported a rapid increase in cases of

main engine failures, citing the rapid increase in engine technology and the engine’s compatibility with a much wider scope of fuel types and quality for the emerging trend.

If the real and potential danger of engine failure and the resulting costs of de-bunkering, as well as the potential litigation claims between owner/operator and bunker supplier, were not by now self-evident, then INTERTANKO’s recent intervention on the matter underlines its importance.

INTERTANKO’s Technical Director Dragos Rauta explained the thinking behind its latest joint submission with Norway to the IMO, which presents data collected from two

testing agencies, indicating that approximately 1.4% of bunkering worldwide was the cause of machinery problems when the ship started using the fuel. Rauta said ship operators faced two categories of problems related to bunkers, namely sulphur content, which can breach MARPOL Annex VI limits, and chemical contamination. Of the two, Rauta said chemical contamination was the most serious issue as it could cause engines to stop, or make operations very difficult.

Bunker sampling is not only essential for monitoring the quality of fuels and protecting critical equipment and machinery; it is also imperative for regulatory compliance and dispute resolution purposes. Testing of bunker fuel can be undertaken on-site or off-site in a dedicated laboratory. Where an off-site test is not specified, then the parameter is not covered in ISO 8217 for that grade of fuel.

On-site testing, enabled through Kittiwake’s product range of sampling equipment, for example, allows for an immediate decision to

be made in case of an off-specification fuel but with a limited number of achievable test parameters.

Off-site testing in a laboratory allows for a much larger number of test parameters to reflect the complete range within the fuel specification ISO 8217.

Understanding the benefits of what both on-site and off-site fuel testing gives to the shipowner/operator offers a good example of how what was once a tick box on a spreadsheet for a bunker surveyor has become increasingly complex and vital to the safe and profitable operation of a vessel.

It is not just bunker fuel content that needs to be monitored. Reducing shipping emissions will be the major driver of change

‘With the wide proliferation of ECAs, information on

what parameters constitute complicity in what region

have become a pre-requisite, as is finding the

right information to unravel the complexities of fuel monitoring and testing’


use fuel within sulphur limits or fit exhaust after-treatment systems.

Continuous emissions monitoring (CEM) has an important role to play in both, and ‘in situ’ tools are the most accurate yet. The IMO regulation allows for abatement technology to achieve sulphur emission reductions and, in line with this, Wärtsilä recently predicted a ‘rapid ramp-up and development of the scrubber market’. Systems capable of measuring down to the equivalent

Bunker Sampling

in the maritime industry for decades to come. In the near term, the sulphur limit for fuels burnt in emission control areas (ECAs) will drop from 1.0% to 0.10% in 2015. And since 2010, vessels also need to comply with EC Regulation 2005/33/EC when in European Union (EU) ports, which, apart from a few exceptions, requires the use of 0.1% maximum sulphur fuel or equivalent emissions. Moreover, legislation pertaining to nitrogen oxide (NOx) has already been implemented and, whilst beyond the horizon, legislation around greenhouse gases (GHG) from either the IMO or the European Union, or both, is imminent.

So shipowners and operators have serious decisions to make and data sets to provide; ultimately based on a complex set of circumstances and a fluid regulatory background. However, there are only two viable options enabling vessels to comply with sulphur oxide (SOx) emissions regulations:

of 0.1% sulphur fuel are key for confirming compliance with SOx regulations when after treatment is used.

With the wide proliferation of ECAs, information on what parameters constitute complicity in what region have become a pre-requisite, as is finding the right information to unravel the complexities of fuel monitoring and testing.

Winston Churchill once said: ‘True genius resides in the capacity for evaluation of uncertain, hazardous and conflicting information.’ If, in 2010, the world communicated more information than ever before, what might we expect from 2011 and years to come? The shipping industry needs information, which in turn leads to knowledge and success. However, ensuring the right information is collated and acted upon when so much misinformation abounds, represents just as much of a challenge for shipping as it does everyone else.

‘Off-site testing in a laboratory allows for a

much larger number of test parameters to reflect the

complete range within the fuel specification ISO 8217’

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Bunkerspot talks to Ismo Matinlauri about Cargotec’s Port2060

It takes a brave man to predict what ports might look like 50 years from now. Will the ‘intermodal’ hub of the

future come with handy rail, road and air links – and access to a space escalator? Keeping our musings a bit more down to earth, will rising sea levels redefine the world’s trade routes and placement of the key ports? What goods will the ships of the future be carrying – and how can we increase the speed at which these goods are moved through the supply chain?

So many questions... and for each question there are scores of possible answers.

The brave man in question is Ismo Matinlauri, Cargotec’s Senior Vice President, Port Cranes. But he is not claiming to be the man with all the answers. Instead, he is asking all of us to share our vision of how ports may develop.

Exploring the possibleIsmo is leading the team that is developing Cargotec’s Port2060 project which aims to ‘explore the possible, the impossible, the problems, the controversies and the daydreams’.

Ismo explains that he was inspired when his children gave him a copy of Marc Levinson’s The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger.

‘This book made me realise that the big picture is such a long-term thing,’ Ismo recalls. ‘Yet it is so easy to get stuck in the problems of the short term.’

Ismo explains: ‘Containerised shipping brought down traditional trade barriers and changed the way products were valued. National industries evolved on this basis, research, technology and trading hubs developed, and world trade – and our high-tech culture – became what it is today.’

So a great deal has changed in the past 50 years, but what kinds of changes does Ismo believe could be in store for the future?

One of the ideas that the Cargotec team has already put out for discussion is the evolution of ‘mega ports’ that will be located offshore on artificial islands.

One of the key selling points of the artificial island model is that it can be fully designed from the ground up to be the ideal cargo handling hub. You don’t have to work around the usual constraints of a port’s geographical position. There will be plenty of room for expansion, a draft deep enough to accommodate even the biggest ships and you can develop deep underground/underwater silos for cargo and fuel storage.

Leviathan container ships will haul cargo

around the network of mega ports, while nimble feeder vessels will make the shuttle runs between the big hubs and their regional cluster of smaller satellite ports.

There are, of course, security benefits to be had from the artificial islands too. The port perimeter is easier to define, easier to monitor and therefore easier to defend.

Ismo believes that the offshore location of the artificial islands will allow for faster turnarounds for ships. Again, this should be a bonus for security because, as the mantra goes, cargo at rest is cargo at risk.

But if the container ships are to get their fast turnarounds, bunker deliveries will have to be snappy too. Whether the industry will still be using barges 50 years hence, or if all deliveries will be ex-pipe, is open to debate. At least we can say that the artificial island model will make it easier for port designers to accommodate the most appropriate and up-to-date bunkering facilities. Perhaps readers of Bunkerspot can let Cargotec and other Port2060 participants know what these facilities might be.

Cargotec’s Port2060 team is also keen to encourage debate on how the port can harness alternative energy sources to power its cargo handling facilities and, of course, the ships that may be taking advantage of the ‘cold ironing’ systems. Solar power and wave energy both offer huge potential, according to Ismo.

The artificial island does throw up some challenges. Having a body of water between the mega port and dry land may help to deter intruders, but it will also make for a more complicated commute to work for the port workers and legitimate visitors. This may not be such a great concern in 2060, however, because the chances are there will be far less direct human intervention in the movement of containers needed.

Ismo suspects that the ports of 50 years hence will make much great use of automated technologies, including sophisticated robots that will be able to perform many of the tasks currently carried out by humans, but with great dexterity and accuracy.

The human elementThere will still be a human element in this environment, but it will be concentrated at the highest level – overseeing the smooth completion of the many thousands of automated tasks.

‘Intelligence’ is the key here. We sometimes talk about ports as if they are living entities, but in 2060 the metaphor may become reality. The port’s network of surveillance cameras, cargo scanners, radar devices and

Future Ports

2060 vision

Ismo Matinlauri is Cargotec’s Senior Vice President, Port Cranes and leads the Port 2060 team.

Contact: Ismo Matinlauri Cargotec Email: [email protected] Web: www.port2060.cargotec.com


but adds: ‘I believe that we can solve the problem, although it might take time.’

Super-intelligenceThe concept that ‘the bad guys’ can break into a supposedly impregnable fortress, and then use its own strength to repel any rescue attempts has been the stuff of countless science fiction books and films – but it is almost certain that the super-intelligent port of 2060 will have so many failsafe and backup systems built into its fabric that the hackers will never be able to take control.

As we said at the start of the article, Ismo and the Port2060 project team don’t claim to have all the answers. Their aim is to spark debate and let the ideas flow from all of us. If you want to get involved, go to the website (www.port2060.cargotec.com) and share your thoughts. As the computer guru Alan C. Kay once said: ‘The best way to predict the future is to invent it.’

satellite-based tracking systems are its eyes and ears, feeding information through to the central brain. And as information comes into the brain, instructions flow out to the port’s limbs – the automated cargo handling systems, cranes, spreaders and transport networks.

Ismo envisages a future where automated trucks will be storing and retrieving containers from cavernous silos, like the innards of a giant juke box. With every container bearing its unique ID and stashed away in its own space, the system will be efficient, fast and secure.

At the business end of the cargo handling process, the ports of 2060 could be equipped with a giant set of hands.

‘Today, we have cranes which can pick up two forty-foot equivalent units (FEUs) or four twenty-foot equivalent units (TEUs) at one time,’ says Ismo, ‘But in 2060, we may have cranes that can handle 64 TEUS lashed together in one movable unit.’

The process might be made easier by manufacturing the containers from lighter, more flexible materials. Ismo believes that the boxes of 2060 could be made from super-strong, super-light plastics. They may be foldable too, so five empty boxes could be stowed in one container slot.

Ismo also raises the prospect that containers will be whisked off ships and moved around the port in the grasp of flying spreaders. The scene will be thick with airships, like bees buzzing round a hive. It may look and sound like pandemonium, but everything will be controlled and coordinated.

With its eyes, ears, limbs, central nervous system and brain, the 2060 port entity will be fully equipped to protect itself from physical intruders.

The worry, of course, is what might happen terrorists or criminals were to hack into the IT system and take control of the brain itself? Ismo acknowledges the concern,

Future Ports

Bominfl ot is an international company operating around the globe, with 35 years of experience in the bunker market.

Our business portfolio covers activities ranging from cargo trading to the supply of bunker fuels, lubricants and other

services. Whenever and wherever you need us. Choose a dynamic partner: www.bominfl ot.net


Ahead of the annual WISTA conference

in Stockholm, GAC’s Resham Rai, Thana’a Abdelkarim, Azeneth Bahian and Loh Mei Lian share

their perspectives on the changing face

of the shipping and bunker industries

To mark the 31st International Conference of the Women’s International Shipping & Trading

Association (WISTA) in Stockholm this September, four of GAC Bunker Fuels Ltd’s (GBFL) dedicated professionals – who just happen to be women – offer their insight into the challenges the bunker sector is facing in their region and the role of creative thinking in a tough climate.

Resham Rai Bunker Trader/ Business Analyst London

‘More and more women are making their mark in what

was once a male-dominated sector. There are still

particular challenges for women’s advancement, but I am confident that – slowly but surely – we will reach an equal gender balance in the

bunker industry’

In the face of reduced freight incomes, higher bunker prices and increased awareness about the environment, it

is essential to adopt new attitudes. Regionally, the production and

sustainability of low sulphur fuel products represent our main challenge. Next year, North America will become an emission control area (ECA) – the third geographical area to be designated as such under International Maritime Organization (IMO) auspices, following the Baltic and North Seas – and other countries will inevitably follow. Eventually, alternative fuels like liquefied natural gas (LNG) will come to dominate the industry, so we must be innovative in preparation for the coming changes.

Right now, however, our biggest challenge is the volatility of fuel prices and fierce competition. Shipowners and charterers seek the best price when lifting bunkers, and the large margins traders used to achieve are a now thing of the past. The only way to tackle this is to ensure we cover enough suppliers to get the best price for our customers. However, the opportunities are enormous for a set-up like GBFL. The GAC Group is strong with the agency side, enabling us to combine services, and it covers important niche areas, with a solid presence in ports like Colombo and Suez.

Making their markI am pleased to see that more and more women are making their mark in what was once a male-dominated sector. There are still particular challenges for women’s advancement, but I am confident that – slowly but surely – we will reach an equal gender balance in the bunker industry.

Thana’a Abdelkarim Bunker Fuels Manager Cairo

‘These days, the bunker market is less in need of knights on chargers and

more in need of the hearts and minds to nurture

relations and business partnerships’

Our real challenges lie in the battles between two positions; to give credit or not; to sell high

volumes or low volumes; to secure high profits on spot sales or favour sustained profits and long-term contracts.

We have to create options – not single-spot solutions – even where none are obviously available. To do so, we have to make sure we know as much as possible about our

Bunker People

As part of the GAC Group, GAC Bunker Fuels Ltd (GBFL) can offer solutions that combine bunkering with other services like ship agency, delivery of ship’s supplies and spares, and weather routing to help optimise fuel consumption efficiency – all under a single integrated GAC invoice. The GACBF team provides its clients with regular updates of current bunker prices and port conditions – either as a direct personalised email or through regular updates online as part of GAC’s free Hot Port News bulletin.

Contact: GAC Bunker Fuels Email: [email protected] Web: www.gac.com/bunkers

Seeing the big picture


customers, the market and our competitors – much more than just knowing their price. Every hint that can be gleaned from annual reports, news items, even social media, can help us gain a fuller picture of how our competitors operate and what clients look for, who they use, and why.

In today’s business environment, effective decision-making is the key to success. Generally, women are more nurturing and tend to be cautious and averse to taking uncalculated risks. This is a good thing in our changing industry. These days, the bunker market is less in need of knights on chargers and more in need of the hearts and minds to nurture relations and business partnerships.

Azeneth Bahian Bunker Fuels Analyst Dubai

‘We have to work harder to win deals – but this helps us sharpen our trading skills’

Perhaps the biggest single issue our sector faces right now is credit. In bunkering, large sums

are involved, so although traders always wants to trade, their Credit Manager may not always be prepared to extend credit. Careful financial evaluation must be made in every case. However, this could also present good opportunities if you are prepared to offer credit to a customer your competitors have refused.

Competition in toughCompetition is tough. All the major trading houses have offices in the Middle East and there are also a number of independents. We have to work harder to win deals – but this helps us sharpen our trading skills.

Quantity and quality are key issues. Disputes are costly and time-consuming, so it’s important to choose the right partners to avoid them. And when disputes do arise, it is essential to deal with them properly and

honestly.In the Middle East, our industry is still

male-dominated on the operations side. However, I’m hopeful that we shall see more women contributing to the best of bunkering in the future.

Loh Mei Lian Senior Bunker Trader Singapore

‘I believe it is my experience and track record as a trader that gives me credibility – my gender is irrelevant’

In Asia, the growing number of trading houses has created the world’s most fiercely competitive bunker

market. The flip-side of that challenge is the opportunity presented by the large number of shipping companies based here. It is essential to stand out from the crowd – and to do so I have to make sure I secure the best possible services for customers and thus demonstrate that they can depend on me whenever they need bunkers. When they think ‘bunkers’, I want my name to be the first that comes to mind.

Being part of a diverse global organisation like GAC helps, as we can connect clients directly with colleagues providing a wide range of other vital services they may need.

In Asia, the bunker sector is no longer the male domain it was once considered to be. Female traders and managers work for all the major international trading houses – and in some cases they represent the majority. However, we do see cases where female traders are hired as part of a marketing strategy to appeal to the (mostly male) people in charge at shipping companies.

Personally, I believe it is my experience and track record as a trader that gives me credibility – my gender is irrelevant. Ours is a tight-knit industry and if you do well, word will spread.

Bunker People

‘In Asia, the bunkers sector is no longer the

male domain it was once considered to be. Female

traders and managers work for all the major international trading

houses – and in some cases they represent

the majority’

Seeing the big picture


‘ Leadership – Opportunities for the Future’ is the challenging headline theme for the forthcoming 31st

Women’s International Shipping and Trading Association’s (WISTA) International Conference and Annual General Meeting (AGM). This year, WISTA Sweden takes on the task of organising this lively and popular event which will be held between 14-16 September in Stockholm.

Some 220 women involved in the shipping sector will gather for three days and engage in discussing the issues facing the industry and the demands that are placed on its leadership. For the third year in a row, the International Maritime Organization (IMO) Secretary General Efthimios Mitropoulos has accepted the invitation to deliver the keynote address at the conference. This year, he will focus on the key topic of global development, and his speech, entitled ‘A new world map placing new demands on leadership’ will be followed by what promises to be a vigorous panel discussion on ‘Managing the shift: a challenge for shipping’.

The origins of WISTA can be traced back to 1974, when a handful of female brokers involved in the tanker market met for a Christmas lunch in London. This event quickly became an annual tradition and, over the years, overseas contacts were invited to join the meetings and the group expanded throughout Europe and further afield to include female executives from other areas of shipping.

In 1981, the first WISTA International Conference and AGM were held in Hamburg, Germany, and since then the annual conference has been held in 17 different countries. Today, WISTA has over 1,300 members across 29 countries. This

WISTA Sweden explains what’s in store

for attendees at the forthcoming WISTA

International Conference and AGM in Stockholm

year’s host, WISTA Sweden, was itself formed in 1987 and is one of the strongest WISTA networks with over 100 members.

The Conference Committee has arranged a programme of panel discussions and workshops where leadership issues and challenges facing women in the shipping workplace will be enthusiastically debated. The conference agenda is still in the process of being finalised but the wide range of topics put forward for panel discussion include ‘Port, city and shipping together; demands on leadership for sustainable development’, ‘Shipping entrepreneurs and sustainable growth’, and ‘Managing the shift – a challenge for shipping’. Workshop sessions are scheduled to focus on recruitment issues, the management of multicultural teams, human factors and system safety, women as board members, and new marine fuels and new ship design.

Speakers, moderators and panellists will include representatives from TransportGruppen, Hoegh Autoliners, the Ports of Stockholm, Gothenburg and Oslo, Gothenburg Energy, ClassNK, Broström, GAC, Star Cruises and DB Schenker.

Events

For more information about the WISTA International Conference and AGM 2011, go to: www.wistaconference.org.

Contact:

Berit Blomqvist, Conference Convenor, WISTA Sweden Email: [email protected]

Lena Gothberg, PR & Press, WISTA Sweden Email: [email protected]

‘The Conference Committee has arranged a programme

of panel discussions and workshops where leadership issues and

challenges facing women in the shipping workplace will be enthusiastically debated’

Taking the lead


and management, and especially the impact on the market – if any – of the recently-revised ISO 8217: 2010 specification. At a time when suspicion about the prevalence of short deliveries continues to rumble on, the conference will also look hard at bunker quantity issues, including the very latest developments in bunker metering.

On the commercial side, as even the largest Rotterdam suppliers are now cutting credit terms from 30 to 21 days, the key subject of credit management, pricing and financing will attempt to shed some light on the prospects for bunker suppliers and their customers. One of the key elements of a good bunker conference is the social networking, and ARACON 2011 should not disappoint, with a dinner planned at the famous Royal Maas Yacht Club sponsored by KPI Bridge Oil and an onboard dinner cruise sponsored by the Port of Rotterdam and Brazil’s Petrobras.

In October, attention turns to training, where the standout event is the Oxford Bunker Course (Advanced) which is to be held in Houston, Texas. The first of these three-day high-level courses, devised and headed by Nigel Draffin of LQM Petroleum Services and author of four best-selling bunker books, was presented in April in Singapore. Designed as a significant step up from the renowned Oxford Bunker Course in the UK, Houston will be its second airing, followed in quick succession by Cape Town, South Africa in November and Singapore in January 2012.

Cape Town also provides a beautiful backdrop for this year’s Oil & Shipping Africa conference, which follows the advanced bunker course, on 1-2 December. Having been presented twice in Accra, Ghana and focused on West African bunkering, this year’s programme takes on an entirely new focus and examines the burgeoning and potentially lucrative business of supplying fuels to Africa’s growing offshore oil and gas industries.

The bunker course in January in Singapore will be accompanied by a conference on LNG and the feasibility of using this fuel as an alternative to bunker fuels, and also by a series of training courses on marine surveying.

Other notable events scheduled for the next few months include the annual International Bunker Industry Association’s (IBIA) annual convention which takes place in Barcelona in early November and BunkerExperience, Goris Vermeulen’s unique three-day course in Rotterdam (see page 56).

As the northern hemisphere grinds almost to a halt under the sizzling holiday skies of summer,

conference and training course organisers continue to work hard to prepare for a series of exciting and informative events scheduled for the hectic autumn season. But while traditional conference themes are again expected to be trawled out for delegates to debate, those organisers who attempt a bit of ‘blue sky thinking’ to look for new topics and ideas can be expected to generate the most interest.

First up is Rotterdam’s main event of the year, ARACON 2011. After last year’s extraordinary conference, onboard the retired and lavishly refurbished cruise liner SS Rotterdam, the event this year moves back into more familiar surroundings at the Hilton Rotterdam, on 21-23 September.

The Amsterdam-Rotterdam-Antwerp (ARA) region is Europe’s thriving shipping, energy and petrochemical centre and therefore is also its largest bunkering hub. This fact alone is enough to attract bunker traders and buyers to trek to Rotterdam at least once a year to visit the local suppliers. Early indications are that many are using ARACON as the trigger to plan their annual trip this September.

ARACON 2011 will of course tackle the key current issues, inviting speakers to look beyond the day-to-day and to contemplate the bigger picture, whether in environmental, commercial or operational terms. Looking at how the European Emission Control Areas (ECAs) are now affecting the everyday operations of suppliers and buyers, speakers will examine their impact on near-term fuel availability, fuel switching, abatement and other environmental issues before looking further ahead at incoming ECAs and the key decisions that have to be made in 2018 and beyond.

One possible environmental solution, and one that is steadily gaining momentum, especially in Northern Europe, is the move towards adopting liquefied natural gas (LNG) as a viable and green alternative to traditional marine fuels. Key speakers from the Port of Rotterdam, engine builders and classification societies will examine the progress of using LNG as a bunker fuel. Other events, most notably in Stockholm in September and Singapore in January, will focus exclusively on this issue but the depth of information being made available to ARACON delegates should be sufficient to equip them for the rigorous debates that will no doubt follow in coming years.

ARACON 2011 will look at fuel quality

Llewellyn Bankes-Hughes looks at some exciting

bunkering events on the horizon

Events

Event horizons

Contact: Llewellyn Bankes-Hughes Managing Director Petrospot Limited Tel: +44 1295 814455 Mob: +44 7768 574 430 Email: [email protected] Web: www.petrospot.com


on regulations.Ian Adams, the Chief Executive of

the International Bunker Industry Association (IBIA) at that time, brought delegates up to date on the latest discussions and deliberations from the International Maritime Organization (IMO) and the European Union (EU).

Wanda Fabriek – who will be stepping down from her position as the Convenor of the International Organization for Standardization (ISO) TC 28 SC 4/WG6, which is responsible for ISO 8217 – gave an overview of the work that went into the fourth edition of the marine fuel specification and an update on the current programme preparing for the next edition, which we may see by 2015.

This was followed by a review of the likely supply and demand position for the next 14 years from Robin Meech.

Meech said that he does foresee a turn around in residual fuel use in the 2020s once the scrubbers begin to have an impact, but this will be after a dramatic fall in demand.

Platts global director, Jorge Montepeque, then walked us through the methodology of Platt’s pricing and some new web-based products, although he was given some searching questions from the floor.

The closing session covered changes and challenges from the perspective of a buyer (Mike Ball of Gearbulk), a supplier (Søren Christian Meyer of OW Bunker) and brokers and traders (my contribution to the conference programme).

In his conference wrap-up, Goris Vermeulen of Vergo Consultancy had us laughing in the aisles as he reflected on life in the bunker business.

After a fabulous Gala Dinner, we watched the first light of Saturday morning appear from an incredible venue overlooking the strait with a view of both bridges, followed by lots more to drink and even more dancing.

The Turkish Bunker Association held its fifth Bunker Conference at the Four Seasons Hotel

Istanbul at the Bosphorus on 1-3 June. The event was attended by 250 delegates from more than 30 countries.

The conference had a strong programme and combined this with a variety of networking and social events that showed off Istanbul and the Bosphorus at their very best.

After welcome speeches from the Turkish Bunker Association and the Port Captain of Istanbul, the keynote address was given by Paul Stebbins of World Fuel Services (WFS) who, with his usual flair, walked us though the minefield of what the challenges and changes of the next five years have to offer. The first main session set the shipping scene with contributions on dry cargo from Dr Henriette van Neikerk, of Clarkson’s research department, and Pinar Kalkavan, President of the Turkish Shipbrokers Association.

Next up, we had a brace of male Kalkavans: Yavuz Kalkavan from Besiktas who looked at the tanker sector; and Alkin Kalkavan of Turkon Line who covered the container sector.

This was followed by a session on credit and finance with contributions from Professor Dr Oral Erdogan from Istanbul Bigli University, Jonathan McIlroy from Peninsula Petroleum and Can Besev from Ocean Intelligence, who laid out the financial prospects and the risks of high prices, low freights and uncertain times.

They were followed by Seren Varol of Global Risk Management, who provided some strategies for dealing with that risk.

The evening featured a boat trip on the Bosphorus when we were able to see the large bulkers and tankers transiting the strait close up. We then dined in Asia.

The second full day opened with a session

Nigel Draffin of LQM Petroleum Services

and IBIA reports back on the Istanbul Bunker Conference

Events

Best of Bosphorus

Nigel Draffin of LQM Petroleum Services and IBIA.


Web: www.informaglobalevents.com/event/airemissions

UNITED STATES: The Oxford Bunker Course (Advanced)10-12 October, Houston, TexasThe Oxford Bunker Course (Advanced) is a highly intensive three-day training course, led by Nigel Draffin and taught by a highly professional team of lecturers. It integrates every aspect of bunkering and is designed for students with at least two years’ experience in bunkering. Contact: Osei Mitchell, Petrospot Tel: +44 1295 814455 Fax: +44 1295 814466 Email: [email protected] Web: www.petrospot.com/houston

NOVEMBER

SPAIN: IBIA Annual Convention2-4 November, Barcelona The International Bunker Industry Association Annual Convention is back in Europe for 2011.Contact: Charlotte Egan, IBIA Tel: +44 2380 226 555 Fax: +44 2380 221 777 Email: [email protected] Web: www.ibia.net

SOUTH AFRICA: Oil & Shipping Africa 201128 November - 2 December, Cape TownAfter two highly successful forays into West Africa, Petrospot returns to Africa for the third annual Oil & Shipping Africa. The conference and training course programmes now attract many African delegates, in addition to a growing number of foreign companies eager to learn about bunkering opportunities in this part of the world. This year’s event will feature the Oxford Bunker Course (Advanced).Contact: Osei Mitchell Tel: +44 1295 814455 Fax: +44 1295 814466 Email: [email protected] Web: www.petrospot.com/africa

GERMANY: Intermodal Europe 201129 November – 1 December, Hamburg Contact: Sophie Ahmed, InformaTel: +44 20 7017 5112 Fax: +44 20 7017 7818 Web: www.intermodal-events.com/bs

Events

Events Diary SEPTEMBER

UNITED KINGDOM: The Oxford Bunker Course12-16 September, OxfordThe Oxford Bunker Course is a highly intensive five-day residential training course covering technical, operational, commercial, financial and legal aspects of bunkering. Designed for newcomers to the business and for those who may already have some experience, it is often oversubscribed, so early booking is essential. It is widely acknowledged as the best bunker course in the world and is renowned for its social activities. Contact: Nicholas Leader, Petrospot Tel: +44 1295 814455 Fax: +44 1295 814466 Email: [email protected] Web: www.petrospot.com/oxford

SWEDEN: WISTA 31st International Conference 201114-16 September, StockholmThe Women’s International Shipping & Trading Association’s (WISTA) annual event is entitled Leadership – Opportunities for the Future. Contact: Berit Blomqvist, Conference Convenor Tel: +46 705 29 8659 Email: berit.blomqvist @swe-shipbroker.se Web: www.wistaconference.org

SWEDEN: LNG Fuel for Shipping: A Commercial Reality?20-21 September, StockholmThe forum will question the business case for using liquefied natural gas (LNG) as a marine fuel and consider what this means for maritime businesses and the bunkering industry.Contact: Informa Events Email: [email protected] Web: www.informamaritimeevents.com

NETHERLANDS: ARACON 201121-23 September, RotterdamARACON 2011, jointly organised by Petrospot and Vergo Consultancy, is the one bunkering event serving the Amsterdam-Rotterdam-Antwerp region that serious maritime professionals should not miss! Comprising a highly-focused two-day conference, dinner at the Royal Maas Yacht Club and an onboard dinner tour of the Port of Rotterdam. Contact: Elena Melis, Petrospot

Tel: +44 1295 814455 Fax: +44 1295 814466 Email: [email protected] Web: www.aracon2011.com

UNITED ARAB EMIRATES: TOC Middle East 201125-27 September, DubaiTOC Middle East is partnering with DP World for this year’s event.Contact: Paul Holloway, TOC Events Tel: +44 20 7017 4394 Email: [email protected] Web: www.tocevents.com

NETHERLANDS: BunkerExperience 201126-29 September, Rotterdam-VlaardingenA three-day course offering a unique combination of classroom learning and real-life experience.Contact: Goris Vermeulen Tel: +32 484 168 780 Email: [email protected] Web: www.bunkerexperience.com

GERMANY: The Seatrade Europe Cruise & River Cruise Convention27-29 September, Hamburg The biennial meeting place of the cruise and river cruise industries.Contact: Amanda Çetin, Seatrade Tel: +44 1206 545121 Email: [email protected] Web: www.seatrade-europe.com

SINGAPORE: Green Ship Technology Asia Conference28-29 September, Singapore Focusing on the challenges posed by climate change and shipping’s effect on the environment.Contact: Informa Tel: +44 20 7017 5510 Fax: +44 20 7017 4745 Email: [email protected] Web: www.informaglobalevents.com/event/gst-asia

OCTOBER

UNITED ARAB EMIRATES: Middle East Workboats3-5 October, Abu DhabiContact: Emma Hamilton, Seatrade Tel: +44 1206 545121 Email: [email protected] Web: www.middleeastworkboats.com

UNITED KINGDOM: Management of Air Emissions from Shipping Seminar10-11 October, London Contact: Informa Tel: +44 20 7017 5510 Fax: +44 20 7017 4745 Email: [email protected]

To list details of industry events, email: [email protected]


Networking

On the move... EuropeIan Adams has resigned as Chief Executive of the International Bunker Industry Association (IBIA). Trevor Harrison, a barrister and an IBIA Main Board Member, has been appointed Acting Chief Executive on a part-time basis pending the making of a full time appointment. Tel: +44 23 8022 6555; Email: [email protected].

After almost eight years as head of the Bominflot bunker department in Hamburg, Tino Kleinitz has handed over his responsibilities for sales and supply to Rune Larsen who joined the company in July after being Managing Director of Hamburg-based International Tanker Management and previously with the lubricants business of FAMM/Chevron. Kleinitz will continue in his role as the Managing Director of the Bominflot tank farm in Hamburg. Lars Döring takes over new responsibilities as Team Leader Europe/Africa for Bominflot International Trading. Karsten Kurth is now Manager Bunker Sales – the position vacated by Döring – and is responsible for all physical sales activities of the Hamburg office. Rolf Röper has been appointed Head of Risk Management for the Bominflot Group, leading the Bominflot risk management teams in Hamburg, Houston and Singapore. Tel: +49 40 350930; Fax: +49 40 3509 3116; Email: [email protected].

Argos Ceebunkers B.V. has relocated to Waalhaven Z.z.11 3089 JH Rotterdam. Tel: +31 10 789 2160; Fax: +31 10 789 2544.

After more than 10 years, Monique Twigt has left Chemoil to join OW Bunker in Rotterdam as a bunker trader. Tel: +31 10 789 1111; Mob: +31 62 297 7169; Email: [email protected].

Rune Kongstein, until May, General Manager at Chemoil in Rotterdam, is now a senior broker at Wilhelmsen Premier Marine AS. Tel: +47 6758 4266; Mob: +47 9944 5585; Email: [email protected]. Capt. Ole Ugland has retired and a new broker, Oyvind Stordal, has joined.

Peter Grunwaldt, previously general manager of bunker purchasing for Glencore’s shipping arm, ST Shipping, has been appointed director of global sales for Chemoil. Tel: +44 7920 494

101; Email: [email protected].

Sandra Parodi has joined Dan-Bunkering (Monaco) S.A.M. as Accountant/Sales Supporter. Tel: +377 97 77 5401; Mob: +377 678 631 963; Fax: +377 9777 5301; Email: [email protected].

Emre Emiroglu has joined KPI Bridge Oil as a bunker trader in its Istanbul office. Tel: +90 212 272 6090; Mob: +90533 475 7213; Fax: +90 212 272 4045; Email: [email protected].

Mideast and Africa Maria Tierney has joined Petrospot as its Africa Representative in Cape Town, South Africa, having worked for more than 22 years as a bunker broker and trader for Cockett Marine Oil Ltd. Tel: +27 22 448 1726; Mob: +27 72 804 9569; Email: [email protected].

OW Bunker Middle East DMCC has relocated to Indigo Tower, Office #709-710, Jumeirah Lake Towers, P.O. Box 486052, Dubai, United Arab Emirates. Tel: +971 4448 4244; Email: [email protected].

Asia PacificChong Kam Wah has retired after serving six years as the International Bunker Industry Association’s (IBIA) regional manager in Asia. He remains a non-executive director of the board of IBIA (Asia).

Yunlong ‘Joe’ Zhou has joined Bomin Bunker Oil Pte Ltd as Regional Credit Manager, responsible for the credit management of Bominflot’s customers in the Far and Middle East Region. Previously, Zhou was General Manager Asia/Pacific (Credit Reports and Data) for Lloyd’s List Intelligence based in China. In Hong Kong – Tel: +852 2891 7799; Mob: +852 6190 0880; Fax: +852 2893 1636; Email: [email protected]. In China – Tel: +86 592 556 4127; Mob: +86 139 5012 5136.

Evelyn Lee Bee Jia has joined A/S Dan-Bunkering’s Singapore office as Accounts Assistant. Tel: +65 6572 4300; Email: [email protected].

Henry Lee has resigned from his position as Deputy General Manager of Soaring Dragon Enterprise Ltd.

Eirik Andreassen has taken over the position of Managing Director of DNV Petroleum Services

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(DNVPS) from Tore Morten Wetterhus, who is returning to DNV head quarters in Oslo to assume the role of Director of Technology & Services at the Governance & Global Development Division. Eirik Andreassen is based in Singapore. Email: [email protected].

Bunker trader Sunny Tang has joined Tokyo-based bunkering company International Bunker Services K.K. Tel: +81 3 5215 8120; Fax: +81 3 5215 8121; Email: [email protected].

AmericasJackie Hoo-Bryant, formerly of IIR, Euromoney and IBS Asia/Informa, has joined Petrospot as its North America Representative in Miami, Florida. Tel: +1 305 456 1838; Mob: +1 786 302 7667; Email: [email protected].

Dr William P. Cullen has rejoined DNV Petroleum Services (DNVPS) as a Senior Consultant after retiring from his position as head of DNVPS Inc. in 2004. He is now a member of the DNVPS Americas team headed by Houston-based regional manager Hauk Larsen Wahl.

Svetlana Piterova has joined C-Fuels America Inc. to take care of all post-fixing tasks. Tel: +1 305 461 2050; Email: [email protected].

Adelaida Ferchmin, Partner in Admiralty Law of Chaffe McCall, is elected President of the New Orleans Chapter of the Women’s International Shipping and Trading Association (WISTA).

After 25 years, Adrian Tolson resigned his position as Vice President of Sales and Marketing at Chemoil in San Francisco. His departure follows the loss in January of Chemoil’s Global Business Development Manager, Keith Richardson, from the San Francisco office and, in March, of Chief Financial Officer (CFO) Jerry Lorenzo from the Singapore office. George Pence, Manager of Sales and Marketing in the United States, also left the San Francisco office after 12 years.

Mats Berglund has been appointed CFO and Chief Operating Officer (COO) of Chemoil.

Christophe Cahen has joined Petrospot as its Latin American Representative, based in Bogotá, Colombia. Tel: +57 1 866 1171; Mob: +57 317 501 6944; Email: [email protected].

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