The Southeast Asian republic is preparing solutions to remain the dominant ship fuelling hub for the 2020s and beyond. The latest installment from our brand new Singapore magazine.
Singapore has maintained its huge dominance in the global bunkering scene, while prepping for a new fuel future with LNG, biofuels and methanol looking like key alternate fuels for the remainder of the 2020s with ammonia coming into play later on.
Of the top 17 bunkering locations around the world that account for 61% of the global market of 230m tonnes, Singapore held a 36% market share last year, according to data from bunker supplier Minerva. Second-placed Amsterdam-Rotterdam-Antwerp (ARA) region had an 11% share with Fujairah filling out the podium with a 6% share, highlighting the extreme dominance the Southeast Asian nation has when it comes to fuelling the world’s merchant fleet.
This year has seen a solid year for bunker sales in Singapore. Monthly sales hit over five-year highs in May. Sales extended gains for a third consecutive month to 4.52m tonnes, up 6.2% month-on-month, Singapore’s Maritime and Port Authority (MPA) data showed.
Quick reactions
“In Monjasa, we continue to see Singapore leading the global shipping industry forward across the most pressing agendas. In particular, the past year has demonstrated Singapore’s dedication to enabling the green shipping transition,” says Morten Ostergaard Jacobsen, who heads up Asian operations for the bunker supplier. Jacobsen praised the MPA in particular for the way it has gone about communicating fuel developments directly to main stakeholders, regionally and abroad.
In the wake of fuel contamination scandal last year, the MPA acted fast. The MPA switched to electronic bunker delivery notes from physical documents this year, and is following this up with a project to register oil flows digitally in 2024 using mass flow meters.
Biofuel growth
Biofuel take-up has been noticeable this year with many operators trialling the fuel out of Singapore.
“There are talks of biofuels reaching 5m tons per year in Singapore by 2030 on the back of the development of the MPA’s quality standard for biofuel blends,” says Jesper Lindegaard Sørensen, managing director of KPI OceanConnect Singapore.
What remains clear is that Singaporean authorities are preparing for a future where no single fuel is dominant – the port will offer the gamut of alternative fuels available in the coming years, albeit with a clear preference for LNG, methanol and biofuels in the short-term.
“With a multi-fuel future ahead, it is unclear if bunkering hubs will remain unchanged. We note that Singapore has put in substantial investment into alternative fuel development alongside with first movers to progress the development together,” says Carl Schou, president of Wilhelmsen Ship Management, stressing that it is vital the republic leads the alternative fuel debate in order to remain a top bunkering hub.
“More could be done to be the centre of competence not only for alternative fuel technology and bunkering but also for varsities and training centres that truly prepare the seafarers of today for the challenges of tomorrow,” advises Peter Schellenberger, a well-known name in local shipping circles who has just set up his own consultancy, Novamaxis.
Methanol moves
Singapore, the world’s top bunkering hub, is getting the infrastructure in place for shipping’s future fuel mix where methanol will play a significant role.
Local firm Consort Bunkers has recently contracted China Merchants Jinling Shipyard to build six 6,500 dwt methanol bunkering tankers while compatriot Global Energy Group is set to receive its first 4,000 dwt methanol bunkering vessel from Japan’s Sasaki Shipbuilding in the final quarter of this year. Another bunker supplier, Golden Island Diesel Oil Trading, is readying to order a methanol tanker up to 12,000 dwt in size for delivery in 2026.
Six companies, including Danish carrier Maersk, have formed a partnership that is building Asia’s first green e-methanol plant which converts captured biogenic carbon dioxide (CO2) into green e-methanol. The plant is being set up in Singapore with a minimum production capacity of 50,000 tons per annum.
While containerlines have led the way towards methanol propulsion, dry bulk and tanker orders are also now in the mix. Another important shipping sector, the cruise business, is also keen to embrace methanol. Costa, TUI Cruises, Disney, and Norwegian have declared their interest in moving toward methanol as a fuel for their cruise ships.
Analysis from class society DNV shows methanol was the second most popular alternative fuel choice for newbuild orders last year after LNG, and has continued to be very popular in H1 of 2023.
This article is one of many reports carried in our brand new 56-page Singapore Market Report. Splash readers can access the full magazine for free by clicking here.
