Nicolle Bloomfield, Account Manager at BLUE Communications, looks back on the global bunkering industry’s bi-annual get-together, SIBCON 2014

This year’s SIBCON comes at a critical juncture for the bunker industry. In many ways, the entire two-day conference was pinned around a single overriding concern – how…

This year’s SIBCON comes at a critical juncture for the bunker industry. In many ways, the entire two-day conference was pinned around a single overriding concern – how do we meet the challenge of increasingly stringent Sulphur Emissions Control Area (ECA) regulations? Of course, it would be foolish to reduce the plethora of issues and challenges that the bunker industry currently faces to a single root cause. However, what I mean here is that over the two days of SIBCON it became increasingly clear just how pervasive and inextricably linked the effects of the 2015 and 2020/2025 SOx ECA’s will be across the entire marine fuels supply chain, and just how much the industry’s hand is being forced.

Representatives from across the industry discussed the ramifications of impending regulations and the solutions currently on the table. From the practical requirements and financial implications, to technical solutions and the business fundamentals that need to be addressed in developing fair, viable and sustainable fuelling solutions. Overall, there was a lingering sense of optimism that the provision of fair, viable and sustainable future fuelling solutions is achievable. But that time is ticking, and there’s a lot yet to be done.

Looking at the 0.1% ECA due to come into force on January 1st, 2015, the general consensus is that distillates will be the most widely adopted compliance solution in the near term. Scrubbers and LNG are options for a select few, but there’s now a new kid on the block that’s throwing this recently agreed consensus into flux – low sulphur fuel oils specifically blended to 0.1% SOx specifications. We’d heard of ExxonMobil’s HDME 50, and at SIBCON, Shell’s Vice President of Oil Markets Analysis, Chris Midgley, unveiled their soon-to-be-launched equivalent.

Whilst these new 0.1% fuelling options may be starting to rock the boat, there was a sense that it’s not just about flexibility in the choice of fuelling options available for ECA-compliance and the inevitable increase in operating costs each option brings. The determining factor of the shipping industry’s response to successfully implementing the 2015 SOx regulations comes down to the means for monitoring and enforcing compliance. Ultimately, there has to be a level playing field, in which the incentive to circumvent the rules is successfully eliminated and the consequences duly and universally enforced. This point was clearly made as the panel including representatives from the U.S Coast Guard, Hong Kong Shipowners Association, Netherlands Shipping Inspectorate and Wallenius Wilhelmsen Logistics debated the issue at length on day two. Unfortunately, we were left without a clear plan of action as to what this will look like come January 1st, 2015.

Then there’s the global 0.5% Sulphur emissions cap to deal with. On this front, we heard more about the future fuelling options, including some significant advancements regarding the move towards LNG as a bunker fuel. Mr Liew Tuk Yew, Singapore’s Minister for Transport unveiled a sizeable LNG-bunkering pilot project including the funding of SG$2 million each for six vessels as the nation-state moves towards establishing a complete LNG bunkering system by 2020. There was also the successful launch of the Society for Gas as a Marine Fuel (SGMF), and an update from the Singapore Maritime and Ports Authority (MPA), along with the ports of Rotterdam, Antwerp, Sohar on work underway to formulate standard LNG-bunkering practices, which all sounds promising.

The over-riding consensus, however, when it comes to responding to the global sulphur cap, as stressed repeatedly throughout the conference, is the need for the International Maritime Organisation (IMO) to bring forward its planned fuel availability study from 2018 (which will determine the implementation date of 0.5% SOx regulations). It was agreed that for all players across the supply chain to adequately respond, the timeline for action must be confirmed as soon as possible.

Finally, in order to overcome the bigger picture challenges, there is a need for local action. We heard over the course of the conference from Singapore’s authorities on how they are seeking to build upon Singapore’s ranking as the world’s leading bunkering port – the mandatory use of Mass Flow Meters for bunkering from 2017, the development towards the use of electronic bunker delivery notes (e-BDN’s), as well as advancing LNG-bunkering infrastructure at a local and global level.

With so much to consider, and so many hurdles to overcome, I’m left to echo the closing sentiments of Dr. Parry Oei, Chairman of SIBCON and Director of Port Services for the Singapore MPA: “It’s time to get up, and to get on with it.”