Malaysia will have adequate LSFO to meet demand as IMO 2020 looms: Transport Minister

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Malaysia is readying for the International Maritime Organization’s global sulfur limit rule for marine fuels and will have sufficient low sulfur fuel oil to meet upcoming demand as the IMO 2020 rule inches closer, Loke Siew Fook, Malaysia’s Transport Minister said during an industry event in the country this week.

“The new global sulfur cap represents a complete transformation in marine transport shipping companies to evaluate their compliance options based on economic and operational factors,” he said in a statement made available to S&P Global Platts Thursday.

Emerging reports indicate that over 95% of global shipping companies will utilize LSFO, he said.

Currently, the major Malaysian ports of Port Klang and Tanjung Pelepas supply about 4 million mt of marine fuels to ships calling these ports, he said.

“I would like to reassure our esteemed shipping lines that sufficient low sulfur fuel oil would be available to meet your demands [come 2020],” he said.

With about 5 million mt of storage and blending facilities in Westports Bunkering Services in Port Klang, Vitol in Tanjung Bin and Port of Tanjung Langsat in Johor, sufficient supplies will be made available to meet immediate demand, he said.

Approved ship-to-ship activities in Tanjung Pelepas, Malacca and Kuala Linggi are expected to supplement any additional demands for LSFO in the shipping industry, he added.

The IMO will cap global sulfur content in marine fuels at 0.5% from January 1, 2020, down from the current 3.5%. This applies outside the designated emission control areas where the limit is already 0.1%.

Ship owners will have to either burn cleaner, more expensive fuels or install scrubber units for burning high sulfur fuel oil.

OTHER INITIATIVES

Meanwhile, Malaysia is also undertaking several other initiatives to enhance its bunkering landscape.

The Malaysian Shipping and Ports Council is progressing measures including identification of issues related to bunker demand and supply, licensing of service providers, integrity aspects including the quality and quantity of the fuel, competency of personnel in the bunkering industry as well as construction and operational standards of bunker vessels, he said.

Initiatives such as the use of mass flow meters on board bunker vessels, training and licensing of bunker surveyors, determination of fuel standards, establishment of bunker fuel testing labs within port areas and appointment of a sole competent authority to oversee the bunkering industry will also be given vital consideration, he added.

Mass flow meters, or MFMs, measure the flow rate in the pipe, indicating the quantity as well as the mass and density of the fuel.

Singapore, the world’s largest bunkering port, first implemented the MFMs mandate for fuel oil deliveries starting January 1, 2017. From July 1, 2019 it extended the MFMs mandate to distillate bunker deliveries as well, ushering more transparency and efficiency in operations for its bunker industry.

Source: Platts

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