25/07/07
Q&A: Bio-bunkers pivotal to low-carbon transition
Singapore, 7 July (Argus) — Equatorial Marine Fuel (EMF) is a leading
Singapore-based physical supplier of marine fuels. The company has an existing
fleet of 21 vessels and bunkers conventional fuels as well as emerging green
fuels, like B24 and B30 blends. EMF was the largest volume supplier of marine
fuels at the port in 2023, according to the Maritime and Port Authority of
Singapore (MPA). The company is expanding its footprint into supplying green
marine fuels and is supplying biofuel blends. Argus ' Mahua Mitra spoke with the
company's chief operating officer Choong Sheen Mao about the potential and
challenges lying ahead for marine biodiesel and other emerging fuels. What is
EMF's strategic position on bio-bunker fuels within Singapore's marine fuel mix?
Equatorial believes that bio-bunkers will continue to play a pivotal role in the
maritime industry's transition towards low- and zero-carbon marine fuels. In the
near-term, biofuels are the most price-competitive low-carbon marine fuel. In
the mid- to long-term, however, it remains to be seen whether biofuels'
comparative ability to scale coupled with the diversion of supply to other
industries will cause biofuels to be less competitive. Equatorial is focused on
the now. Our volume and variety of biofuel bunker deliveries have increased. We
have been looking at this space closely over the past few years, having obtained
our International Sustainability and Carbon Certification (ISCC) in 2022 and
performed our first biofuel delivery in 2023. We continue to monitor and
participate in the development of other alternative marine fuels as well. Given
the regulatory requirements around biofuel delivery, what is your assessment of
Type II barge availability in Singapore? Conventional bunker tankers operating
in the Port of Singapore have been allowed to carry and deliver biofuels up to
B30 since 7 March 2025. While there will be more Type II barges available in
Singapore, this may not have a material impact on biofuel deliveries in the near
term as most deliveries are still either B24 or B30. In any event, Equatorial
has invested in four 7,999 deadweight tonne (dwt) IMO Type II chemical and oil
bunker tankers capable of carrying and delivering methanol and biofuels up to
B100. Two of these Type II barges have been delivered at the start of this year,
and we are looking at two more to be delivered in the third or fourth quarter of
2025. Equatorial is in a position to actively participate in supplies of
biofuels up to B100. Which types of biofuel blends (e.g., B24, B30) are you
seeing increased demand for in the near term? What market, regulatory, or
operational factors are shaping these preferences among your clients? The
considerations regarding the use of alternative marine fuels depends on a myriad
of factors including but not limited to the vessel's trading area, business
model, and end-customer/consumer base. The increasing demand of B24 and B30
bio-fuel blends fluctuate between these regulatory and commercial concerns. The
GHG Fuel Intensity (GFI) framework, in combination with a pricing and reward
mechanism that was recently approved by the International Maritime
Organisation's (IMO) Marine Environment Protection Committee (MEPC) during its
83rd session (MEPC 83) in April 2025, will be the single most significant
consideration for our clients. If formally adopted in October 2025, it will be
mandatory for large ocean-going ships over 5,000 gross tonnage, which emits 85pc
of the total CO2 emissions from international shipping. It would then enter into
force in 2027. For vessels trading with the EU, they would already be familiar
with the European Union (EU) Emissions Trading System (ETS) on carbon allowances
and FuelEU Maritime penalties. Is EMF considering entry into the LNG bunkering
segment, either directly or through strategic collaboration? Equatorial has
ordered a 20,000m³ LNG bunkering vessel to be delivered in 2027. With the global
demand for LNG as a marine fuel projected to increase substantially over the
next few years, Singapore, the world's largest bunkering hub, is a strategic
location for LNG bunkering. The key concern is how soon existing bunkering
infrastructure should be further scaled to meet the increase in demand. When it
comes to bio-blend trading, what are the most significant challenges you
anticipate? Presently, the most significant challenges are still demand and
price-competitiveness. Lower oil prices would mean biofuel feedstocks are
relatively expensive. These are uncertain times, nonetheless, and geopolitical
development remains highly uncertain, and, as such, commodity prices highly
volatile. Bunker buyers will always opt for the most economical means to comply
with regulations and requirements. Equatorial continues to manage business risk
by working closely with customers on their requirements and closely monitoring
international affairs and markets. By Mahua Mitra Send comments and request more
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