Mass Flows Meters At Fujairah Need Robust Regulatory Support

Credit: Unsplash
  • MFMs can be effective tool to achieve transparency in bunkering
  • Port authority has no plans at present to mandate MFMs
Bunkering at Fujairah would benefit from the transparency that mass flow meters confer and consequently attract more market players, but only if a mandate to use the units had robust backing from the authorities, according to bunker suppliers.

Fujairah is the world’s third largest bunker hub, with 8.03 million mt of marine fuel sold there in 2022.

Port authorities regulation

“In principal, MFMs can be highly effective, however they need to be implemented effectively. This includes regulation by the Port Authorities and a clear process for resolving any disputes,” an official at Vitol told S&P Global Commodity Insights.

MFMs are accurate instruments, but they are easily cheated outside of a robust regulatory and enforcement framework, such as that which exists in Singapore, Minerva CEO Tyler Baron told S&P Global. While the company would “strongly support” ports following the example of Singapore and making MFMs compulsory this requires an effective regulatory framework to be developed.

“We believe many ports such as Fujairah will only adopt MFM regulations if and when they see that they are losing market share to more transparent alternative bunkering locations,” Baron told S&P Global.

TGF Marine

In March 2021, Minerva, the only supplier utilizing MFM-equipped barges in Fujairah, began the commercial offering of its new Advanced Delivery Platform, or ADP, which is now available in Fujairah, Singapore, ARA, Jebel Ali, Yanbu, Jeddah, and Vancouver as another solution to quantity shortages. ADP digitizes delivery documentation and is integrated with mass-flow metering technology to provide complete transparency.

TFG Marine is one significant supplier that would welcome MFMs at Fujairah. “The UAE is important for TFG Marine and one of the areas that is constantly on our agenda, but we are waiting on the right timing and conditions to start operations in the region. The introduction of MFM and digitalization would make this a more straightforward decision,” a spokesperson for the company told S&P Global.

Singapore, the world’s biggest bunker hub with 47.88 million mt of marine fuel sales in 2022, mandated MFMs in 2016 and this was widely lauded by the industry, amid financial help with installing them and a firm regulatory environment for them to operate in.

Rotterdam, the world’s second biggest bunker hub at 10.8 million sales of marine fuel in 2022, and neighboring Antwerp-Bruges have announced they will implement them.

In H1 2023, the European port authorities will identify suitable bunker measuring systems and will work on a target date for implementing them. The deadline will be “ambitious yet realistic,” the port authorities said in a statement.

The bunkering industry is losing as much $5.2 billion of fuel annually to quantity shortages because of outdated methods used to measure deliveries, Baron told S&P Global in a recent interview.

With some theft or overstated consumption by the ship crew itself along with short deliveries by bunker suppliers, fuel theft is relatively easy to carry out unnoticed, costing the industry up to 9 million mt/year of lost bunker fuel out of a total of 230 million mt of delivered product last year, he said.

The vast majority of quantity measurement is done by rolling a tape down into a cargo tank of a bunker vessel and measuring the height of the fuel line before and after delivery.

This is open to manipulation and human error, sources said.

The port authority had said last year it has no plans to make mass flow meters compulsory but there is growing interest across the industry in greater use of the instruments, following Singapore’s example.

Platts, part of S&P Global, assessed delivered 0.5% sulfur fuel oil the prevailing marine fuel, at $588/mt March 28, which has decreased steadily from $1,140/mt June 30.

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Source: SP Global


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