Bunkers: Qualifying Quality - Navigate · PDF fileIndia Japan Kyrgyzstan Mexico Netherlands...
Transcript of Bunkers: Qualifying Quality - Navigate · PDF fileIndia Japan Kyrgyzstan Mexico Netherlands...
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Bunkers: Qualifying Quality
A supplier's view of what really happens
Bob Thornton – World Fuel Services 10 March, 2014
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World Fuel Services Corporation
All figures, except employee count, are as of 12/31/12* Source: Fortune 500 Ranking Issue Date May 6, 2013** As of February 2013
▪ 2013 Revenue $41.6 billion
▪ Market capitalization $3.28 billion
▪ Stock symbol NYSE: INT
▪ Fortune 500 Ranking* 74
▪ Global headquarters Miami, Florida, USA
▪ Founded 1984
▪ Number of employees** 2,500
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3
Global Presence with Over 60 Offices
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Afghanistan
Australia
Argentina
Brazil
Canada
Chile
Colombia
Denmark
Germany
Gibraltar
Greece
Hong Kong
India
Japan
Kyrgyzstan
Mexico
Netherlands
Norway
Russia
Singapore
South Africa
South Korea
Taiwan
United Arab Emirates
United Kingdom
United States
SingaporeMiami London
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WFS is #1 in market with 10% shareMillion
MT
0.0
3.0
6.0
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12.0
15.0
18.0
21.0
24.0
27.0
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1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
WFS Manages the Largest Bunker Volume
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Marine Technical – who are we?
5 professionals with broad technical knowledge and marine educational backgrounds
About 180 years experience
marine fuel and lubrication quality
bunker fuel testing
ship machinery and hull Inspection
new ship construction
project management
marine consulting
shipboard engineering
marine engine design and construction
Bob Thornton
Dennis Eley
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Marine Technical
Sea experience
Multiple types of diesel and steam vessels
Members of
ISO 8217 Marine Fuel Specifications Working Group
ISO 13739 - Bunkering Protocol Working Group
CIMAC Heavy Fuels Working Group
IMO's Marine Environmental Protection Committee
IBIA Board (International Bunker Industry Association)
John Stirling Gajanan Pawar
Manuel Vinas
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Technical Issues Facing the Industry
Frequency of fuel claims
• Quantity disputes both higher in number & tonnes
• Related to high price of fuel
• Quality claims more complex – FTIR / GCMS
• Influence of the testing services
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Technical Issues Facing the Industry
Environmental Legislation
• Proliferation of ECAs
• Rules and enforcement not uniform
• 2015 – Max 0.1% sulfur in an ECA
• 2020 – Max 0.5% sulfur global
• Scrubbers vs using LSGO or 0.5% LSFO if available
• Is LNG really the future?
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Technical Issues Facing the Industry
Changing fuel quality • Suppliers blending to meet legislation v.s. spec
• Law of unintended consequences
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Typical concerns
Quantity disputes
– Use of surveyors
– Barge vs ship figures
– Cappuccino – real or an excuse for sleeve oil
– Vnet
Quality claims
– Sulfur test accuracy
– MARPOL vs Commercial testing
– Study of “normal” bunkers
– Debunkering may no longer be possible
– Using what’s on board
Sulfur legislation
– Revision of the EU Sulphur Directive
– North American ECA : U.S. & Canada
– Reports of detentions & fines in Europe & USA
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Fuel quality
– Is it really getting worse?
– ISO 8217: 2005 vs 2010 vs 2012 vs Future
– Blending to meet LSFO with MGO
– Cost to meet sulfur specs with 95% & 99% certainty
– Responsibility of the vessel to clean the fuel
– Future availability – an educated guess
Sampling
– MARPOL vs Commercial samples
– Why suppliers insist on sampling on the barge
– Why Owners want it on the vessel
– What we’ve seen
Contractual requirements
– Supplier’s terms of sale
– Charter party clauses
Additional worries
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Ask Anything!
But first – Since perception becomes truth
Is the quality of bunkers really getting worse?
Are Catfines increasing dramatically as claimed by many?
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Are Bunkers Getting Worse?
Courtesy of DNVPS
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WFS Bunker Claims - 2013
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Split of Registered Claims - 2013
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WFS Quality Claims - 2013 98.5% of products (MGO & IFO) delivered by WFS are free
of claims
Of the 1.5% having a claim, only 32% relate to quality
Quality Claims = 32% of 1.5% or less than 0.5% of WFS deliveries
WFS results are 50x lower than the 25% off-spec test results cited by some test labs
Frequently the contractual sample is subsequently tested and found to be on-spec
Since some WFS quality claims relate to reports from vessels, not lab results, the difference is even higher
Are we that good or is there some explanation for the extreme difference?
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Focusing on Al+Si
Courtesy of DNVPS
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A Dramatic Increase or?
Data - courtesy of DnVPS
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Data - courtesy of DnVPS
An Accurate Depiction
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Data - courtesy of DnVPS
Use of Truncated Graphs
Note that both of these graphs display identical data; however, in the truncated bargraph on the left, the data appear to show significant differences, whereas in theregular bar graph on the right, these differences are hardly visible.
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It’s not always the fuel
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Now you can ask anything!
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GC-MS Analysis
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Quality – What’s in Bunkers
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Sulphate SO4 - 534.6 mg/kg (ppm)
Calcium Ca++ 208.0 mg/kg (ppm)
Chloride Cl - 68.0 mg/kg (ppm)
Magnesium Mg++ 53.5 mg/kg (ppm)
Sodium Na+ 42.0 mg/kg (ppm)
Potassium K+ 2.8 mg/kg (ppm)
But what is this?
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San Pellegrino Mineral Water
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Sulphate
Bicarbonate
Calcium
Chloride
Magnesium
Sodium
Silica Residue
Strontium
Potassium
Borates
Nitrate
Fluoride
Bromide
Lithium
SO4 –
HCO3 –
Ca++
Cl –
Mg++
Na+
SiO2
Sr++
K+
H3BO3
NO3 –
F –
Br –
Li+
534.6 mg/kg (ppm)
222.7 mg/kg (ppm)
208.0 mg/kg (ppm)
68.0 mg/kg (ppm)
53.5 mg/kg (ppm)
42.0 mg/kg (ppm)
9.4 mg/kg (ppm)
3.5 mg/kg (ppm)
2.8 mg/kg (ppm)
1.2 mg/kg (ppm)
0.77 mg/kg (ppm)
0.61 mg/kg (ppm)
0.40 mg/kg (ppm)
0.18 mg/kg (ppm)
San Pellegrino Mineral Water