’We’re just realising the financial impact that a single batch of bad fuel can have on the industry,’ says FuelTrust chief executive Jonathan Arneault, following alerts of contamination in Singapore bunkers raised by fuel labs and insurers
The latest fuel contamination outbreak to hit the bunkering market, this time in Singapore, should be a wake-up call to the danger of discovering quality issues only after fuel is on board vessels.
FuelTrust estimates the scale of this contamination outbreak to have spread to dozens of vessels. The disruption is widespread, with many vessels suffering blackouts, engine damage, and the need to debunker. Given the additional disruption to cargo delivery, insurance claims could easily run in the hundreds of millions of dollars.
We are seeing another fuel crisis similar to Houston in 2018. Four years later, the lawsuits from Houston are still ongoing, and we’re just realising the financial impact that a single batch of bad fuel can have on the industry. This recent incident is shining a light on a persistent global issue. Fuel quality problems cause debunkering issues every month in ports around the world, most of which never make the news.
Bunkering remains a fragmented supply chain, full of ’unknown unknowns’. Contaminant issues may not be picked up by today’s required testing. The lack of digital technology to drive transparency and traceability across the industry means greater risk of fuel quality, quantity, compatibility and fraud issues. Early warning systems to alleviate risk exist today, at a cost that works out to cents on the barrel.
We have analysed more than 390M barrels of fuel, looking at their exact chemical make-up.
Viswa Labs owner Dr Ram Vis echoed the call to use technology to better document and analyse risk in the supply chain.
"The current bunker quality problems give a feeling of déjà vu from an organic chlorides contamination in 2001, and more recently what we saw in Houston four years ago. While the industry has taken steps to safeguard the fuel supply chain, how do we prevent this from ever happening again in the bunker fuel industry?
"The most effective solution is to use technology, reducing reliance on manual procedures wherever we can. There are plentiful technologies available today which can facilitate that. We can use blockchain to create a secure record of analysis, so any gaps can be instantly identified, and the point of contamination or adulteration can be captured. In addition to blockchain, machine learning will capture the changing trends in the fuel quality relative to the bunkering port and supplier. If applied correctly, machine learning along with blockchain should prevent a recurrence of such incidents for decades to come. The last time this happened in Singapore, the MPA took very stringent action, and it is a tribute to their constant vigilance that, for almost 21 years, there has not been any major contagion there," Dr Vis said.
The Marine Propulsion Webinar Week will be held from 11 April 2022. Register your interest and access more information here
© 2023 Riviera Maritime Media Ltd.