Overview

The marine fuel sector is decarbonising. International Maritime Organization (IMO) requirements and EU legislation is driving this change alongside consumer demand for low carbon solutions. 

These drivers have prompted shipowners to invest in alternative marine fuels including; marine biodiesel, bio-methanol, grey methanol, LNG, ammonia and hydrogen.

Argus provides pricing, insights, and intelligence for the fast-growing alternative marine fuels market with independent news, analysis, and market commentary on emerging changes and trends so you can stay ahead.

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Latest alternative marine fuels news

Latest alternative marine fuels news
04/06/24

Oman's Sohar port starts B20 biofuel bunker trials

Oman's Sohar port starts B20 biofuel bunker trials

Dubai, 4 June (Argus) — Oman's port of Sohar has received the first shipment of biofuel to begin its pilot trial in marine tug operations, according to state news agency ONA. The trial will use B20, which typically is a blend of 80pc diesel and 20pc used cooking methyl ester (Ucome), sourced locally. Biodiesel is viewed as a more environmentally friendly alternative to marine fuels, such as low- and high-sulphur fuel oils. The port will conduct the trials in collaboration with tugboat operator Svitzer, biofuel producer Wakud and Omani bunker provider Hormuz Marine. Oman has committed to reach net zero carbon emissions by 2050. "The use of biofuels will significantly contribute to reducing the level of harmful emissions," port chief executive Emile Hoogsteden said. "The project would set an example to be emulated in the region and beyond." Several companies have expressed interest in increasing usage of biofuels as pressure mounts on the shipping industry to reduce emissions. The UAE's port of Fujairah received its first biofuel bunker cargoes in December 2023. Oman has been taking steps to develop its conventional and alternative bunkering infrastructure in recent years in an effort to become a serious competitor to the region's main marine fuels hubs, like Fujairah. In April, TotalEnergies took a final investment decision (FID) for the integrated Marsa LNG bunkering project it is carrying out with state-owned OQ. The company said it wants the project to serve as the first LNG bunkering hub in the Mideast Gulf, "showcasing an available and competitive alternative marine fuel" to reduce shipping emissions. By Rithika Krishna Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Latest alternative marine fuels news

ISO publishes new marine fuel specification


30/05/24
Latest alternative marine fuels news
30/05/24

ISO publishes new marine fuel specification

London, 30 May (Argus) — The International Organisation for Standardization (ISO) published its new marine fuel specification standard today. The 7th edition of the specification standard, ISO 8217:2024, will replace its predecessor, ISO 8217:2017, which has now been withdrawn. The document encompasses seven categories for distillate fuels, four categories for residual fuels at or below 0.5pc sulphur content, five categories for residual fuels blended with fatty acid methyl ester (Fame) biodiesel and five categories for residual fuels above 0.5pc sulphur. Some of the changes had previously been discussed and are confirmed. These include the removal of the previous 7pc Fame limit when blended with distillate marine fuels. This is now possible up to 100pc. The distinction between winter and summer quality for cloud point and cold filter plugging point (CFPP) has also been removed. And there is now a requirement to report the net heat of combustion for a distillate fuel grade as well as the requirement for a minimum cetane number and oxidation stability. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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ScanOcean to supply MGO-HVO blend in Sweden


21/05/24
Latest alternative marine fuels news
21/05/24

ScanOcean to supply MGO-HVO blend in Sweden

London, 21 May (Argus) — Swedish bunker firm ScanOcean will supply a B30 marine biodiesel blend made of marine gasoil (MGO) and hydrotreated vegetable oil (HVO) by truck at all Swedish ports. The B30 blend will comprise 70pc MGO and 30pc HVO and meet ISO 8217:2017 MGO specifications, according to ScanOcean. The biofuel component will not contain any fatty acid methyl ester (Fame) and the blend will reportedly be accompanied by ISCC-EU certification and a proof of sustainability (PoS) document. ScanOcean added that they will supply the physical blend but that the HVO component will be sourced from the EU. The B30 blend will achieve a 25pc reduction of CO2 emissions on a well-to-wake basis when compared with conventional MGO, according to the Swedish supplier. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Latest alternative marine fuels news

Q&A: Marine CO2 goals need culture shift: TotalEnergies


20/05/24
Latest alternative marine fuels news
20/05/24

Q&A: Marine CO2 goals need culture shift: TotalEnergies

Amsterdam, 20 May (Argus) — A cultural change in buying behaviour and supply patterns is necessary for the shipping sector to meet its decarbonisation targets and may be the biggest hurdle to overcome, strategy and projects director for TotalEnergies' marine fuels division Frederic Meyer told Argus. Edited highlights follow: What is the biggest challenge standing in the way of the maritime industry in meeting decarbonisation targets and the fuel transition ? A cultural change is required — for decades the maritime sector has relied on by-products with high energy density from the crude refining process such as fuel oil. The industry will now have to pivot its attention towards fuels developed for the purpose of consumption within the maritime industry. This will also require time as the sector looks to level up, and it remains to be seen whether there will be enough time to meet the International Maritime Organisation (IMO)'s net-zero by or around 2050 targets. But we have seen some good progress from cargo owners who are seeking scope 3 emissions related documents. How does TotalEnergies see marine biodiesel demand moving in the short term? In the short term, there is little incentive for the majority of buyers in the market. This is due to a lack of any regulatory mandates, as well as limited impact from existing regulations such as the IMO's carbon intensity indicator (CII) and the EU's Emissions Trading System (ETS). Despite providing a zero emission factor incentive for biofuels meeting the sustainability criteria under the EU's Renewable Energy Directive (RED), EU ETS is still on a staggered implementation basis beginning with only 40pc this year, rising to 70pc next year and 100pc in 2026. Further, EU ETS prices have been quite low, which also weighed on financial incentives for marine biodiesel. Therefore, many buyers are currently waiting for further incentives and signals from the regulators before purchasing marine biodiesel blends. Another point impacting demand is the current edition of ISO 8217, which does not provide much flexibility when it comes to marine biodiesel blend percentages and specifications. The new 2024 edition will likely provide greater flexibility for blending percentages, as well as a provision for biodiesel that does not meet EN14214 specifications. This will provide greater flexibility from a supply point of view. However, there remains stable demand from buyers who can pass on the extra costs to their customers. And how do you see this demand fluctuating in the medium to long term? If the other alternative marine fuels, such as ammonia and methanol, that are currently being discussed do not develop at the speed necessary to meet the decarbonisation targets, then marine biodiesel demand will likely be firm. Many in the market have voiced concerns regarding biofuel feedstock competition between marine and aviation, ahead of the implementation of sustainable aviation fuel (SAF) mandates in Europe starting next year. With Argus assessments for SAF at much higher levels than marine biodiesel blends, do you think common feedstocks such as used cooking oil (UCO) will get pulled away from maritime and into aviation? With regards to competition among different industries for the same biofuel feedstock, suppliers may channel their feedstock towards aviation fuels due to the higher non-compliance penalties associated with SAF regulations as opposed to those in marine, which would incentivise greater demand for SAF. An area that can be explored for marine is the by-product when producing SAF, which can amount to up to 30pc of the fuel output. This could potentially feed into a marine biodiesel supply pool. So it's not necessarily the case that the two sectors will battle over the same feedstock if process synergies can be found. Regarding fuel specifications, market participants have told Argus that the lack of a marine-specific fuel standard for alternatives such as marine biodiesel is feeding into uncertainty for buyers who may not be as familiar with biofuels. What impact could this have on demand for marine biodiesel blends from your point of view? Currently, mainstream biodiesel specifications in marine biodiesel blends are derived from other markets such as the EN14214 specification from road diesel engines. But given the large flexibility of a marine engine, there is room to test and try different things. For "unconventional" biofuels that do not meet those road specifications, there needs to be a testing process accompanied by proof of results that showcase its safety for combustion within a marine engine. Some companies may not have the means or capacity to test their biodiesel before taking it into the market. But TotalEnergies always ensures that there are no engine-related issues from fuel combustion. Suppliers need to enact the necessary testing and take on the burden, as cutting out this process may create a negative perception for the product more generally. Traders should also take on some of the burden and test their fuels to ensure they are fully compatible with the engine. With many regulations being discussed, how do you see the risk of regulatory clashes impacting the industry? The simple solution would be an electronic register to trace the chain of custody. In the French markets, often times the proof of sustainability (PoS) papers are stored onto an electronic database once they are retired to the relevant authority. This database is then accessible and viewable by the buyer, and the supplier could also further deliver a "sustainability information letter" which mirrors the details found in the PoS. It is important for the maritime sector to adopt an electronically traceable system. What role could other types of fuels such as pyrolysis oil potentially play in the maritime sector's decarbonisation targets? We have teams in research and development at TotalEnergies which are studying the potential use of other molecules, including but not limited to pyrolysis oil, for usage in the maritime sector. It may become an alternative option to avoid industry clashes, as pyrolysis oil would not be an attractive option to the aviation sector. We are currently exploring tyre-based pyrolysis oil, but have only started doing so recently so it remains an untapped resource. We need to figure out the correct purification and distillation process to ensure compatibility with marine engines. For the time being we are specifically looking at tyre-based pyrolysis oil and not plastic-based, but we may look at the latter in a later stage. The fuel would also have to meet the RED criteria of a 65-70pc greenhouse gas (GHG) reduction compared with conventional fossil fuels, so we are still exploring whether this can be achieved. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Latest alternative marine fuels news

Low-carbon methanol costly EU bunker option


16/05/24
Latest alternative marine fuels news
16/05/24

Low-carbon methanol costly EU bunker option

New York, 16 May (Argus) — Ship owners are ordering new vessels equipped with methanol-burning capabilities, largely in response to tightening carbon emissions regulations in Europe. But despite the greenhouse gas (GHG) emissions savings that low-carbon methanol provides, it cannot currently compete on price with grey methanol or conventional marine fuels. Ship owners operate 33 methanol-fueled vessels today and have another 29 on order through the end of the year, according to vessel classification society DNV. All 62 vessels are oil and chemical tankers. DNV expects a total of 281 methanol-fueled vessels by 2028, of which 165 will be container ships, 19 bulk carrier and 14 car carrier vessels. Argus Consulting expects an even bigger build-out, with more than 300 methanol-fueled vessels by 2028. A methanol configured dual-fuel vessel has the option to burn conventional marine fuel or any type of methanol: grey or low-carbon. Grey methanol is made from natural gas or coal. Low-carbon methanol includes biomethanol, made of sustainable biomass, and e-methanol, produced by combining green hydrogen and captured carbon dioxide. The fuel-switching capabilities of the dual-fuel vessels provide ship owners with a natural price hedge. When methanol prices are lower than conventional bunkers the ship owner can burn methanol, and vice versa. Methanol, with its zero-sulphur emissions, is advantageous in emission control areas (ECAs), such as the US and Canadian territorial waters. In ECAs, the marine fuel sulphur content is capped at 0.1pc, and ship owners can burn methanol instead of 0.1pc sulphur maximum marine gasoil (MGO). In the US Gulf coast, the grey methanol discount to MGO was $23/t MGO-equivalent average in the first half of May. The grey methanol discount averaged $162/t MGOe for all of 2023. Starting this year, ship owners travelling within, in and out of European territorial waters are required to pay for 40pc of their CO2 emissions through the EU emissions trading system. Next year, ship owners will be required to pay for 70pc of their CO2 emissions. Separately, ship owners will have to reduce their vessels' lifecycle GHG intensities, starting in 2025 with a 2pc reduction and gradually increasing to 80pc by 2050, from a 2020 baseline. The penalty for exceeding the GHG emission intensity is set by the EU at €2,400/t ($2,596/t) of very low-sulplhur fuel oil equivalent. Even though these regulations apply to EU territorial waters, they affect ship owners travelling between the US and Europe. Despite the lack of sulphur emissions, grey methanol generates CO2. With CO2 marine fuel shipping regulations tightening, ship owners have turned their sights to low-carbon methanol. But US Gulf coast low-carbon methanol was priced at $2,317/t MGOe in the first half of May, nearly triple the outright price of MGO at $785/t. Factoring in the cost of 70pc of CO2 emissions and the GHG intensity penalty, the US Gulf coast MGO would rise to about $857/t. At this MGO level, the US Gulf coast low-carbon methanol would be 2.7 times the price of MGO. By comparison, grey methanol with added CO2 emissions cost would be around $962/t, or 1.1 times the price of MGO. To mitigate the high low-carbon methanol costs, some ship owners have been eyeing long-term agreements with suppliers to lock in product availabilities and cheaper prices available on the spot market. Danish container ship owner Maersk has lead the way, entering in low-carbon methanol production agreements in the US with Proman, Orsted, Carbon Sink, and SunGaas Renewables. These are slated to come on line in 2025-27. Global upcoming low-carbon methanol projects are expected to produce 16mn t by 2027, according to industry trade association the Methanol Institute, up from two years ago when the institute was tracking projects with total capacity of 8mn t by 2027. By Stefka Wechsler Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Argus marine fuel database sample extracts alternative fuels

Alternative fuels vessels and supplier list

Argus lists vessels that are burning alternative marine fuels, including methanol, biofuels, ammonia, hydrogen, LNG, LPG, as well as those running on batteries. The database is updated every month.

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Argus marine fuel database sample extracts scrubbers

Scrubbers

Argus’ scrubber database is the only database to provide granular vessels details such as vessel name, owner, IMO number, deadweight, etc.

The database is updated every month. It contains over 4,300 records and counting.

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With deep expertise in the markets for future marine fuels, Argus can provide detailed insight for the marine industry as it transitions towards decarbonisation. Here are some of our related services: