In an unusual mover, Shell International Eastern Trading Company (SIETCO) has chartered a tanker to ship up to 80,000 tonnes of slurry oil from Singapore to Ruwais in the United Arab Emirates (UAE).
What happened?
On August 18, Shell has chartered the tanker ‘Maersk Prosper’ to load 80,000 tonnes of fuel oil from Singapore for discharge into Ruwais at a $450,000 fee. The destination Ruwais is located in the UAE and is the site of Abu Dhabi National Oil Corp’s (ADNOC) 800,000-barrel-per-day (bpd) refinery.
Slurry oil is a residual by-product of the oil refining process and is typically mixed with heavy fuel oil to reduce its viscosity, but can also be used a refining feedstock.
Shell declined to comment
This move by Shell to import slurry oil has been termed as an arbitrage move because the Ruwais refinery rarely imports residual fuel oil products. Since January 2017, the Ruwais refinery has been a major exporter of feedstock grade straight-run fuel oil after a fire forced it to shut its 127,000 bpd residue fluid catalytic cracker (RFCC).
When questioned about this move, Shell did not divulge any details details of commercial agreements or the movement of cargoes.
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Source: Reuters
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